Rivals not crashing
Competitors thrive in NY despite Uber’s cash
Despite Uber’s alliance with its biggest Chinese competitor, smaller rivals believe they can make headway against the ride-hailing behemoth.
Earlier this week, Uber agreed to sell its Chinese operation to ride-sharing incumbent Didi Chuxing, sparking fears that Uber would turn its billions on rivals elsewhere.
In New York especially, investors worry that Uber will hit rivals like Lyft, Via and Juno with even more aggressive subsidies and discounts with its war chest worth billions that was earmarked for China.
But so far, the competition won’t be cowed — arguing, for instance, that their smaller fleets consume less cash than Uber’s does.
“I do not think what happens in China is going to have any direct, immediate impact right now on what consumers are paying in NYC for Uber, Lyft or their competitors,” said former NYC Taxi and Limousine Commissioner Matthew Daus.
“There is now, and will be, significant and steep competition in NYC and else- where for Uber and Lyft, in the form of cheaper rides, better deals for drivers and faster service,” Daus said.
Via — which uses roomy SUVs to pool passengers — still has “superior technology” versus Uber, according to founder and Chief Execu- tive Daniel Ramot.
“To maintain Via at $5 is much cheaper than to maintain UberPool at $5,” Ramot said, referring to Uber’s competing service.
Juno has generated buzz in its initial months as an invite-only app, offering gen- erous discounts for riders and reportedly luring thousands of drivers by taking commissions of just 10 percent, versus the 20 to 25 percent Uber and Lyft demand.
Asked about Uber’s deal with Didi, Juno CEO Talmon Marco said, “It’s too early to speculate regarding the impact of such a deal, if approved by the Chinese regulator, on the US market.”
Lyft notched its best-ever month in July, booking fares at an annualized run rate north of $2 billion, up from $1.9 billion in May, according to a source.
While Lyft’s commissions typically are 20 to 25 percent, it is spending $50 million a month this year on discounts for passengers and incentives for drivers.
Meanwhile, Didi’s deal with Uber isn’t stopping the Chinese giant from backing other rivals elsewhere in Asia like Singapore’s Grab.