Lyft Emphasizes Shared Rides to Compete with Uber, Via

As new transportation options are on the rise, such as electronic scooters, dockless bike-sharing, and ongoing competition with other ridesharing apps, Lyft has redesigned their strategy. In an attempt to adapt to the changing market and promote sustainability, Lyft’s new strategy looks to increase their current rate of shared rides from 30 to 50 percent by 2020. Through renaming its “Line” option to “Shared Rides,” Lyft looks to minimize confusion surrounding its carpool option. Currently in beta, Lyft will soon prompt solo users of shared rides heading in the same direction to join in a shared ride. If the solo users opts to join the shared ride they will receive a fare cut. Ultimately, capitalizing on more shared rides increases Lyft’s revenue per driver and could help reduce traffic congestion.

Additionally, Lyft will roll out their equivalent of Uber’s Express Pool and Via’s rideshare service. Through offering shared rides that drop off passengers a block or so from their destination, Lyft intends to cut down on unnecessary detours to save time for the remaining passengers and driver. Lyft’s beta redesign follows Uber’s instituted changes. In both Lyft and Uber’s updates, they’ve pursued public transit partnerships to better serve consumers needing to get to and from transportation hubs such as airports and train stations.

Lyft’s update follows Via and Uber’s charge to replace public transportation. According to The Verge, in cities such as Arlington, Texas, consumers are able to summon one of ten commuter vans operating primarily in the city’s downtown area. Fares are only $3 per ride or $10 for a weekly pass. When asked about this service, Arlington’s mayor said, “I think with the new technology that’s coming on, you’re going to see very little light rail built because this is so much cheaper.” Similarly, Altamonte Springs, Florida has completely replaced public transportation with subsidized Uber rides. Uber’s CEO, Dara Khosrowshahi, expressed interest in furthering Uber’s integration within public transportation.

Additionally, both Lyft and Uber face competition against the latest surge of dockless bike and electric scooter sharing firms. Lyft is reportedly negotiating to purchase Motivate, the bike share company behind CitiBike and Ford GoBike. Motivate serves as the largest bike-share provider in the U.S. and Lyft is rumored to be looking at a $250 million figure. If finalized, Motivate’s purchase would represent another step in the two firm’s competition, Uber acquired bike-sharing startup Jump in April for $250 million.

According to Wired, Lyft and Uber’s push for market consolidation is reflective of the market’s shift. The National Association for City Transportation states that, “regular [Lyft and Uber] users ride about 12 minutes per trip, covering about a mile and a half. Bird and Lime report similar numbers for their scooters. These are distances that are annoying to walk, but don’t make a lot of economic sense in an Uber or Lyft, which can cost closer to $15 for the same trip during rush hour. Bikes and scooters threaten to cut into the short-trip market for ride-hail.” Lyft’s purposed purchase of Motivate incorporates consumer’s preferences for bikes and scooters that are not subject to surge pricing.

As the market continues to expand with new options, consumers are seeing an array of more affordable options for trips that may otherwise be a cumbersome walk or that could be inconvenient for public transit.  As electronic scooters and dockless bikes could eat into ride-sharing profits, and consumers are looking for the most affordable and convenient options to get around their cities.

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