Ride-sharing app Lyft heads to New York (without the pink mustache)(Read article summary)
Lyft, the San Francisco-based ride-sharing company, is moving its service to New York, stoking competition with other ride-sharing companies such as Uber.
Ted S. Warren/AP/File
Conquering New York City. It's a time-honored tradition for aspiring writers, broadway stars, and financial whizzes. And now, yes, for start-ups determined to disrupt every last inch of the transportation industry.
Lyft, the private San Francisco-based ride-sharing company, is expanding its services to the Big Apple, in addition to the more than 60 American cities where it currently operates. For its New York move, Lyft vehicles will also shed their signature pink mustaches, which have traditionally adorned drivers' vehicles to distinguish themselves for passengers.
"Those are the areas that are most underserved by public transportation," John Zimmer, Lyft’s chief executive, told The New York Times. "There’s a huge need to unlock the city for people who want to access it at a lower price point."
Lyft will not, at least for now, operate in Manhattan. This means commuters may be able to use Lyft to get from Brooklyn and Queens into Manhattan but will not be able to use Lyft to go the other way around, notes The Times.
Lyft will begin service in New York at 7 p.m. on July 11 with 500 drivers, according to Bloomberg. To begin accumulating customers in New York, Lyft's services in the city will be free "for at least the first two weeks," notes Bloomberg, adding that for now the company will not take the 20 percent commission it typically takes from its drivers.
To summon a vehicle, people can use the Lyft smart phone app to alert a driver to pick them up. Users can then track their driver's route with the app as well as view a photo of the driver and his or her car – drivers use their own cars. The driver then takes people to their destination of choice. Passengers pay using their credit card information, which they must input into the app. Fares are often done on a "donation" basis rather than a straight fare as one might with a traditional cab.
Lyft is trying to snag customers away from Uber and other competing ride-sharing apps. But recent months have seen a string of negative reactions toward these kinds of peer-to-peer ride-sharing companies, from lawsuits alleging they don't comply with local transportation guidelines to protests in both the US and Europe as traditional transportation providers try to resist the long arm of disruptive technology. Thus far, Lyft has managed to avoid abiding by regulations by saying its drivers are not real employees; as such, they do not receive employee benefits.
Yet these companies are gaining momentum. Lyft was recently valued at more than $700 million in a financing round, while Uber was valued last month at $17 billion in a round of financing. And in its fierce battle for market share, Uber has even been subsidizing cheaper rides for customers in such cities as New York, San Francisco, and Los Angeles, paying drivers more than what customers actually paid for the ride, Wired points out.
For its part, Lyft says it has discussed its move into New York with the city's government and the NYC Taxi & Limousine Commission, according to Bloomberg. Still, Lyft vehicles will not have official taxi licenses from the Taxi and Limousine Commission as is the case with the fleet of Uber vehicles that operate in New York City. Currently, Uber does not provide its peer-to-peer ridesharing service that it offers in other cities. Rather, all Uber-affiliated vehicles in New York operate with permission of the Taxi and Limousine Commission. However, Uber has expressed a desire to bring its peer-to-peer ridesharing platform to New York should regulators ease up the restrictions currently in place.
"If regulators embrace ridesharing with a relaxed approach to licensing and enforcement with other companies, Uber will be excited to launch our ridesharing platform soon in the state of New York," reads an official Uber statement.
-This article has been updated to include information on the details of Uber's operations in New York.