If You’re Deleting Uber, You Might as Well Delete Lyft Too
In terms of ethics, the two companies are not that different.
Over the past couple of weeks, Uber has taken a beating for its CEO’s initial refusal to leave President Trump’s advisory committee and for how the company reacted to the immigration ban. In contrast, Lyft has been getting a lot of good press for taking advantage of the anger generated toward Uber by presenting itself as a more compassionate ride-hailing company. It’s a great PR move that has shot the company’s app to the top of the App Store, but it ignores how these two dominant ride-hailing brands have almost identical business models (and morals). If you’re really looking for an alternative to Uber, you might have to look a bit further.
Pitchforks Out for Uber
As thousands of people surrounded airports across the country to protest the immigration ban, the New York Taxi Workers Alliance (NYTWA) announced that their taxi drivers would not pick up any passengers at John F. Kennedy International Airport, which had become a focal point of the ban’s opposition. Soon after, Uber tweeted that it had disabled surge pricing in the vicinity of the airport, which many perceived as an attempt by Uber to make it cheaper for people to hail rides from the airport and therefore undercut the NYTWA strike.
The anger generated by this action, followed by a statement from CEO Travis Kalanick released on the same day — wherein he defended his decision to remain in the president’s business advisory group — led to a mass campaign to discourage Uber use. The mini movement spread across social media with the hashtag #DeleteUber .
After more than 200,000 people deleted their Uber accounts—so many that developers had to automate the account-removal process — Kalanick resigned from the advisory committee and promised to assist drivers impacted by Trump’s travel ban.
Amid the controversy swirling around Uber, Lyft’s cofounders sent out an e-mail condemning the immigration ban and promised to donate $1 million to the ACLU over a four-year period. These actions provided a clear contrast between Uber and Lyft and encouraged many people who wanted to rideshare with a clean conscience; as a result, Lyft’s app surpassed Uber in daily downloads for the first time.
But is Lyft truly so different from Uber? On this issue, Lyft engaged in a brilliant PR move, but the reality is that the two ride-hailing companies have very similar business models, which means that many of the problems people have with Uber are also core features of Lyft.
Average wages for Lyft and Uber drivers have been found to be very similar — and, as with Uber, Lyft drivers are responsible for their own vehicles and all associated expenses, which means that wages are even lower than advertised once these costs are deducted.
Lyft = Uber Lite
Uber gets a lot of negative press (and rightfully so) for the actions it takes to reduce the pay of its drivers and to deny them basic workers’ rights. Yet Lyft often evades similar scrutiny. That doesn’t mean it isn’t doing many of the exact same things.
Uber has been criticized for claiming its drivers can make up to $30 per hour, which has been found to be untrue. Lyft has advertised that drivers make up to $35 per hour; yet when Vox correspondent Timothy B. Lee tested the claim, he made just $12 per hour, or $10.50 after expenses. At the time, Lyft promised a minimum of $1,500 per week (or $30 per hour) for drivers who spent at least 50 hours on the road, yet average wages for Lyft and Uber drivers have been found to be very similar — and, as with Uber, Lyft drivers are responsible for their own vehicles and all associated expenses, which means that wages are even lower than advertised once these costs are deducted.
While Lyft does have higher driver-approval ratings than Uber, it has still been cutting fares, which forces drivers to take more passengers and spend more time on the road to earn the same amount. The most recent cut occurred in January 2017 as the company sought to rapidly expand in the United States to challenge Uber.
The lack of benefits and/or job security for drivers has been a major point of criticism of ride-hailing companies. Much of the reporting on this issue has focused on Uber, but drivers have had similar issues with Lyft. In 2016, Lyft had to pay out a $27 million settlement to more than 100,000 drivers in California, was forced to change its rules on driver dismissals and had to allow drivers to take up pay issues with an independent arbiter. As with Uber, Lyft relies on independent contractors, and Lyft preferred to pay the $27 million settlement than allow its drivers to be reclassified as employees —a scenario that would mean Lyft would have to give drivers benefits.
Lyft is also following Uber’s move into competition with public transit, whereby both companies see potential for future ridership growth and guaranteed profits. Lyft’s first partnership of this nature was with Centennial, Colorado, and both companies benefit from subsidized rides in Miami. However, there are significant issues with these initiatives, including an inequitable distribution of public funds, specifically because ride-hailing services are far less accessible to the poor and disabled, and the companies are often not willing to share data with government authorities, nor with the broader public.
The idea that Lyft is a more compassionate or morally sound ride-hailing company is false. It continues to place profitability and ridership growth before fair wages and working conditions for its drivers, using the same methods as Uber. Lyft simply escapes the same level of scrutiny because its market share is so much smaller.
Real Alternatives to Uber and Lyft
When Austin, Texas, passed stricter rules to regulate ride-hailing companies in 2016, it targeted both Uber and Lyft. The competitors briefly put aside their differences to team up on a ballot initiative to repeal the rules — which was rejected by voters and led to both companies pulling out of Austin entirely.
The absence of the ride-hailing oligopoly allowed for innovation and competition among the small companies that emerged to fill the void. While the ride-hailing experience wasn’t quite the same for riders—some prices and wait times increased — drivers had more options and were better paid by the upstarts.
The anger over Uber’s reaction to the immigration ban did not simply appear out of nowhere. Public anger toward the company had been simmering for a long time and finally reached a point where many could no longer justify patronizing Uber. Lyft successfully marketed itself as being morally superior to Uber — yet as these examples illustrate, it is little more than a mini Uber.
Anyone angry at Uber shouldn’t simply jump into the arms of Lyft but should instead look at the other ride-hailing options available in their city. Austin showed that ride-hailing needn’t be dominated by one or two major companies, and that there are benefits to increased regulation and consumer choice.
Finally, those who really want to challenge the morally bankrupt model of Uber and Lyft, which denies drivers good benefits, reasonable working conditions and fair pay in the name of profitability, should instead be using public transit wherever possible and fighting to improve it. In November 2016, nearly 70 percent of all public-transit ballot measures were passed by voters, totalling more than $170 billion in additional transit funding. And from a worker standpoint, public-transit workers are generally salaried with benefits, and being a public-transit worker is still a solid path to the middle class.
We live in a political era in which companies are expected to have a political position on major issues; likewise, the body politic is increasingly willing to boycott them if they deem those positions unacceptable. The opposition to Donald Trump’s presidency shows no signs of relenting, and the #DeleteUber campaign should be taken as an indication that ride-hailing needs to change its practices or will risk being abandoned in favor of transportation options that better align with public values.
