Off to the boonies
Lyft to serve rural US
Lyft is driving into the countryside in an effort to raise ridership and steal market share from rival Uber.
The much smaller Lyft announced Thursday that it is offering service to passengers in every corner of 32 US states, including hard-to-reach rural areas. The move boosts the number of states with full coverage to 40.
Uber, which controls about 70 percent of the US ride-hailing market, says it has near-statewide coverage in 13 states. A spokeswoman was skeptical that any company could provide timely service in all areas.
For Lyft, run by Chief Executive Logan Green, the expansion is a bold move into unserved areas and a gamble that it can carve new markets out of even the most rural areas that have ride-hailing needs but no consistent service. Until now, using a smartphone to summon a ride mainly was reserved for larger metropolitan areas with a lot of people and more potential riders.
Jaime Raczka, regional director of new markets for Lyft, said the initiative will allow the company to out-match its rivals in terms of coverage area and the number of people with access to its platform. Before Thursday, 79 percent of the US population could get Lyft service. That number now rises to 94 percent, she said.
To pull off the expansion, Lyft has been recruiting new drivers for months, many in smaller towns that weren’t previously served. The company has about 700,000 nationwide.
Just how long it takes to get a ride will vary by area. She wouldn’t give an average response time or fare estimate for rural areas, but conceded that initially it may take more than 10 minutes to get a ride in remote places.
There's clearly a market for ride services in rural areas, especially from people who are older, disabled or injured, said Gartner analyst Michael Ram- sey. Until it becomes established, Lyft will have to pay drivers extra to fetch passengers in rural areas, generating some big losses, he said.
But he expects demand to grow and eventually pay off. “There are a lot of people who need mobility, and especially in rural communities, don't have access to it,” he said. “Demand comes from the supply, and vice versa.”