NEW RIDE IN TOWN
Uber’s chief competitor, Lyft, is about to shake up Toronto’s ride-hailing industry, expanding outside U.S. for the first time
Ride-hailing company Lyft, Uber’s main rival, will soon offer lifts to GTA residents in its first foray outside the U.S.
“We’ve been a business for five years and have been focused entirely on the United States, so we were very deliberate when making a decision to launch in Toronto as our first international market,” John Zimmer, Lyft’s president and co-founder, told the Star in an exclusive interview.
“We see it as a world-class city. It will likely become one of our top five markets overall. We expect that to happen, and we see it as a city that really shares the values that we have at Lyft — focusing on people taking care of people, treating people well, treating people with mutual respect and promoting both inclusion and diversity.
“It’s a big decision. It’s a big moment for us, and we’re excited to be coming to Toronto.”
Preparing to go head to head with Uber, Lyft is signing up local drivers — including some who will respond to smartphone hails via both companies — and will set up a local “hub” offering expertise to those who want to use their personal cars to make money.
Lyft plans to launch next month in the Greater Toronto Area and Hamilton with five options: regular vehicles for up to four passengers; the Plus service, with vehicles that can carry up to six people; Premier, offering high-end cars; Lux, with luxury black cars “piloted by a top driver”; and an SUV version of Lux.
The company is not yet ready to announce passenger rates, driver fees or details of the Toronto office.
The expansion comes more than five years after Uber barged into the Toronto market, upending the traditional cab industry. Its lobbying efforts helped produce, just over a year ago, regulations approved by city council, legalizing app- based “private transportation companies” alongside taxis.
Uber has become part of Toronto’s transportation scene, with almost 50,000 drivers — many part-time — and new services including food delivery.
Uber remains America’s ride-hail king, and quickly expanded to other countries, but it has been rocked by scandals and lawsuits that triggered a #DeleteUber movement, questions over driver treatment, and the replacement of chief executive and founder Travis Kalanick.
Lyft, which retired fuzzy pink moustaches in drivers’ grilles in favour of a glowing dashboard device called the “Amp,” has mostly avoided such headlines.
Asked how Lyft will compete, Zimmer says 5,000 Torontonians downloaded the app this year with no service available. And, while he won’t say the word “Uber,” he has no hesitation in positioning his company as a more ethical option to “our competitor.”
“It’s important to give people a choice . . . In order to provide the best hospitality to the end customer, you need to take best care of the drivers, and that’s something we’ve done for five years,” Zimmer said. “It will be reliable, it will be affordable, but it will also be an experience more focused on the hospitality service.”
He pointed to Lyft’s decision, long before Uber, to let users tip drivers within the app, and a program to help non-owners rent cars by the week so that they, too, can earn money as drivers.
Khalid Ahmed, 31, says he makes about $30 an hour, less expenses, as an occasional driver for Uber. He plans to switch to Lyft.
“It’s new, it’s fresh. It’s like waiting in line for the new iPhone — I’ve got to have it,” he said with a laugh. He also likes the company’s mission statement and driver incentives. “At the end of the day, I’m available to the highest bidder.”
Few, however, expect human drivers to be part of ride-hailing’s future. Uber has set up a lab in Toronto to test self-driving cars. Zimmer himself, in a September 2016 blog post, predicted that by 2021 the majority of Lyft rides would be in “autonomous fleet vehicles.”
CapitalG, the growth investment fund of Google parent company Alphabet, is leading a $1-billion (U.S.) round of financing in Lyft. Another Alphabet company, Sidewalk Labs, wants to develop a high-tech neighbourhood on Toronto’s east waterfront that will include self-driving cars and potentially buses.
Zimmer says there is no connection between Sidewalk Labs’ interest in Toronto and Lyft’s move north. Still, his vision of the urban benefits of people electronically summoning transport, rather than owning it, jibes closely with the one espoused by Sidewalk Labs.
“The bigger vision for Lyft is to say, for the last 100 years our cities have been shaped by car culture and by car infrastructure, and by car ownership specifically. That’s led to traffic, high expense, cities paved over,” he said in the interview from San Francisco, where both Lyft and Uber are based.
“We can allow our cities to be redesigned around the people living in them instead of the cars parked in them.
“That’s the bigger vision, and I think all of the things that we are seeing happening in Toronto are other reasons why we want to be there and we want to be part of that discussion and part of making sure that happens.”
Not everyone is convinced. Kristine Hubbard, Beck Taxi’s operations manager, expects Lyft’s entry to worsen Toronto gridlock. “It’s another reason to encourage cars to cruise the streets of our city — many of them who come from outside it — who otherwise wouldn’t be there.”
The taxi industry fought hard against Uber’s entry.
Noting she can’t speak for cab owners or drivers, Hubbard said business for Beck — a dispatch and marketing service for independently owned taxi clients — has “never been better.”
But she’s frustrated the market is getting more crowded before the city releases a review of the vehicle-forhire bylaw promised after the oneyear mark.
“As more companies move into this space, we really need to see this report that is four months overdue,” she said.