When Uber first hit the scene, Torontonians were elated to have a taxi alternative.
In the years since, however, there have been a number of high-profile gripes with the popular ride-hailing service, ranging from stories of driver misconduct to criticism of the San Francisco-based company’s business model.
Starting next month, Uber competitor Lyft will hit Toronto streets, giving the city another option to get around. The move was first reported a year and a half ago.
Lyft’s first international expansion
The expansion will mark the company’s first outside of the United States, where it has operated since 2012 and currently provides close to 20 million rides per month in 300 cities. It’s M.O. is essentially the same as Uber: users enter their personal details and payment information on Lyft’s mobile app, request a ride from their phone or tablet, track the arrival of their driver, and allow the transaction to complete electronically.
Various studies have concluded that fares between Uber and Lyft are similar. They’re also similar in that they both employ drivers as independent contractors instead of employees, for which Uber has taken a big regulatory hit.
Competitive advantage
The newcomer boasts one significant advantage, however: reputation. With little distinguishing the two companies, Lyft is banking on its venture north to be buoyed by the increasingly negative connotations associated with its biggest competitor.
“Lyft is a little late to the [international] game, but enjoys a better public image [than Uber], which I expect will ease their expansion efforts,” said Carl Doty, vice president and group director at research firm Forrester. “They are playing this slow and steady wins the race game.”
Whether Lyft can retain this image in the face of scrutiny by employment tribunals and taxi association protests – both of which has damaged Uber’s perception as it expanded internationally – remains to be seen. For now, it’s all love notes and opportunity.
“We have had our sights 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,” Lyft CEO Logan Green said in a statement to CNN. “We’ve had incredible interest from both drivers and passengers in Toronto.”
25% bonus for drivers
To entice drivers to sign up for its service, Lyft will offer a 25 per cent bonus for the first 3,000 who are approved and complete 20 rides/week during the company’s first three months of operation in Toronto.
Further expansion into other cities in Canada has not yet been announced.