December 2017

Lyft slated to hit Toronto streets later this month

by Mike Beggs

The fastest-growing ridesharing app in North America, Lyft will be hitting the streets of Toronto before Christmas with the rest of the Greater Toronto and Hamilton Area soon to follow.

This comes on the heels of Uber’s huge influx of competition in Canada’s largest city with 50,000 cars and counting.

Lyft has been sizing up this market for a few years. In making the announcement, GM Tom Houghton said Toronto was a “no brainer” for the company, and projects it will be the company’s fifth-largest market.

“First of all, it’s the fourth-largest city in North America, and a real global city as we think about expanding internationally,” he told CBC’s Metro Morning.

“We also share a lot of values with the city. And finally we think there’s a pent-up demand left here in Toronto because 50,000 people in Toronto have downloaded the Lyft app this year, but haven’t been able to use it.”

Having obtained a Transportation Network Company (TNC) license, under the City’s Vehicle For Hire bylaw, Lyft can now put an unlimited number of cars on the road. It’s clearly ready to take a run at Uber, and offered a 25 percent discount to the first 3,000 drivers signing up on its app.

“We’ve had our eyes set on international expansion for months, and the Canadian market is an obvious fit for Lyft’s culture, values, and the service that we provide,” co-founder and CEO Logan Green stated in a press release.

Torontonians can expect prices, and wait times similar to Uber. But Lyft management suggests the way it treats passengers and drivers is what will facilitate its success in this market.

“We differentiate ourselves in a number of ways, and one of the ways is experience -- the experience people have on our platform,” Houghton told CP 24. “We achieve that just by treating people better -- whether the drivers, regulators, or passengers.”

But while Lyft represents another choice for consumers, it amounts to added competition for licensed taxi drivers, and Uber, in an already overcrowded marketplace.

“All that will make me do is see more trouble,” says Anthony, who has been driving cab, “too long”.

He has already lost more than half his business due to Uber’s arrival and the City’s laissez faire attitude in regulating it.

“I can’t make money anymore,” he adds. “Why did (the City) do that? It’s very unfair. I guess there’s nothing we can do.”

A 25-year veteran taxi driver named Mohamed agrees this latest ridesharing entry will affect business, “big time”.

“The Mayor and Council, they made a mistake. They chose that kind of business. They messed up, and now no one is making money -- not taxis, or Uber, or Lyft,” he comments.

“Another five or six years, maybe the taxi business is done.”

According to long-time independent David Frankel, Lyft’s arrival in Toronto was only to be expected, as the new way of the world.

“It would appear to me Lyft will take some of Uber’s business, and maybe expand the market for new customers,” he offers.

“We’ve moved into a new business model and where it ends up, I don’t know. Ultimately, it will affect taxi drivers. All industries will be affected by technical automation. I think I should have moved into another business. It’s difficult.”

In the eyes of veteran Mississauga driver Ron Baumber, “Lyft is the same thing as Uber. It just waters it down even more.”

But he agrees TNC app technology is revolutionizing the industry.

“It’s better (service). The dispatch system is spectacular,” he adds. “I think taxi companies have the technology to make things better, but they’re so locked into the old model.”

Beck Taxi owner Gail Souter sees Lyft as “the new flavour of the day” for Toronto riders.

“Once the floodgates have been opened, what’s the difference if a few more drops get in,” she says of its arrival. “I think there will be a battle between Uber and Lyft.”

But she slams the City for failing to protect taxi interests.

“There’s no cap (on the number of Lyft vehicles). I think that’s irresponsible, when we are promised a report after 1.5 years -- and my understanding is (the City hasn’t) started the report,” she continues. “But yet the City has embraced Lyft and met with Lyft on several occasions, and given them the green light.”

Beck operations manager Kristine Hubbard observes that when the new VFH bylaw was passed, Lyft officials made it clear the rules were too onerous for them to launch in Toronto.

“I think it’s really interesting they’re now saying, ‘It’s okay.’ And I think that’s because the regulation (on TNC’s) has been almost non-existent,” she told CTV News.

South of the border, Lyft now operates in approximately 300 cities, provides 18.7 million rides a month, and is valued at US7.5 billion. And while that’s a fraction of Uber’s $60-billlion-plus valuation, it has been slowly but surely gaining market share over the past year, in light of the many scandals dogging its rival.

Lyft saw a 60 percent jump in passenger activations in the week following the #uberdelete campaign, in January. And as the Los Angeles Times noted, while positioning itself as a gentler alternative to Uber, Lyft has aggressively seized the moment by raising $600 million to spike further growth, throwing its hat in the ring of the autonomous car race (forging a partnership with Ford Motor Company, and opening a research hub in Palo Alto, California), and exploring an initial public offering for 2018.

And according to documents published by Transport for London, Lyft has been meeting with the regulator there, and weighing out the prospects of that lucrative market as a toehold into Europe.

To date, Lyft has, by and large, avoided the bad press, and legal problems which have accompanied Uber’s rapid ascent Ð president and co-founder John Zimmer calling it, “the better boyfriend”. Its four core values include: Be Yourself; Make It Happen; Uplift Others; and Create Fearlessly.

At the second annual Human Synergistics Cultural Conference in October of 2016, Lyft’s vice president of people Ron Storum acknowledged the importance of keeping these corporate values intact, as the company becomes a bigger player.

“At Lyft, our product is really people, and we build a platform that connects communities, so we try to find talent that aligns to that,” he said. “It’s so important for us to be collaborative and team-oriented.”

“We have a rule, we don’t hire any assholes. It doesn’t mean we don’t want tough conversations, but we do it in a collaborative way.”

Flashing pink or purple with the company icon emblazoned on it, Lyft’s dashboard lamp should eliminate some of the late night safety concerns surrounding Uber (with taxi industry leaders alleging that few of the 50,000 Uber X cars bear the City mandated identification sticker).

“When you request a ride at night, it will flash a certain colour that’s the same as on your app,” Houghton explained to CP 24. “It makes an icon that’s recognizable on the street, I can spot my driver 100 yards away. It really pops at night. It’s very bright. People are definitely going to notice that.”

When asked how many more transportation options the City of Toronto needs --given the downtown gridlock -- he suggested the more ridesharing options the better, and noted that Lyft also offers a carpooling service (matching passengers going in the same direction for a discount of up to 60 percent).

He also touted the benefits of ridesharing in reducing car ownership Ð noting how much space around the city is dedicated to parking.

“I think, with ridesharing, the long-term vision is to really reduce car ownership in urban landscapes like Toronto. And that’s going to have a positive effect on the city’s transportation culture,” he told Metro Morning.

However, as a bottom line, taxi industry leaders say this just adds an uncapped number of vehicles for hire on the road.

“It’s the same (old) schtick,” Souter alleges. “Oh, everything’s wonderful. We’re going to reduce congestion -- 50,000 additional cars don’t really affect anything?”

“Why are we all so blind? I don’t get it.”

Like Uber, Lyft claims ridesharing has created all kinds of economic opportunity in the U.S., where they have hundreds of thousands of drivers, “who are either making a decent living full-time, or are part time.” It was the first to install a tipping option for drivers on its app.

However, like its ride-booking rival, Lyft has been challenged by workers over their status as independent contractors. In the spring of 2016, Lyft drivers in California filed a federal class action suit against the company, claiming they were “misclassified”, seeking monetary compensation and additional benefits.

In Toronto, Lyft will be offering a range of five different services. That includes: regular cars for up to four passengers; its Plus service for up to six people; its Premier luxury cars; and its Lux service -- with a choice of black limos, or SUV’s with a “top driver”.

In BloorWest Village, consumers expressed decidedly mixed opinions about Lyft coming to town.

“Why not? Competition is always good,” says Blake, an Uber user. “Uber, I haven’t had a problem yet. Why not give it a try?”

“I think it’s useful,” agrees a man named Mike. “Cheaper, convenient. Technology is good. Yes, definitely. Competition is always good for users.”

However, Eric has a different view.

“I’m not actually into that. I think you’re talking to the wrong Millenial,” he says. “I have a car, and if I don’t drive I still take a taxi.”

A lady named Susan likes Uber X because it’s “easy to use”, but she won’t share an Uber with multiple passengers.

“(Safety), it doesn’t concern me,” she adds. “But I might not put teenagers into a Lyft car. I might not put teenagers in a cab, either.”

“I think it’s going to suck for Uber,” jokes Bailey, when the question is put to her.

“Sometimes I use Uber, if I’m stuck,” she continues. “But I like people, too. I like sitting on a bus.”

“Cameras would probably be good. And cabs have the emergency button.”

For his part, Chris chuckles, “I’m a cab guy. I only have a flip phone. My first alternative is to get in a cab. Uber never.”


© 2017 Taxi News



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