Lyft and Uber appear to be companies of the future when it comes to transportation, but let’s not count our eggs before they hatch. There are plenty of shady things that Lyft, as well as rival, have done to take away from people’s quality of life, even disrupting to cities and our planet.
It’s not all rainbows and sunshine when it comes to Lyft. People are losing jobs because of the company—transit is losing riders, having to shut down, which means less operators. Traffic is exponentially increasing in cities where Lyft is an option, and the company shows no signs of slowing down. Emissions are out of control.
At one point, people assumed Lyft and Uber would take over car ownership within the next ten years, but that hopefully won’t come to pass because of a few savvy laws and truths about ridesharing that’s been coming out of studies.
Here are 19 sketchy facts about Lyft.
You know you have some sketchy practices when an entire city vetoes you out of their town. New York City did just that, and it makes sense why: the taxi industry there is huge (and it’s run by pretty unscrupulous people).
In 2014, the Taxi and Limousine Commission threatened to impound Lyft’s cars based on the start-up offering “unauthorized service.” The Department of Financial Services issued a cease and desist order against Lyft for “acting in bad faith.”
One scary idea that has a tinge of “Skynet” to it is Uber CEO Dara Khosrowshahi’s abstract talks about penetrating the “total addressable market,” which Lyft is trying to do, too.
Uber and Lyft want to capture 15% of all global economic activity, including food delivery, personal mobility, and freight shipping, which would put a LOT of people out of business and on hard times. It might excite investors, but it’s going to come at a huge cost to the rest of us.
About 50% of a Lyft driver’s time on the road is spent with passengers and another 50% is spent without. Many Lyft drivers use more mileage without passengers than they do with them—this is a practice known as “deadheading.”
Estimates of total deadheading vary from 30% to 60%, and Lyft’s policies make this worse—they encourage drivers to constantly circle to decrease wait times for potential users, which only adds to traffic.
Much of what we know about Lyft is through independent studies. The company makes it difficult to study the social impacts of their apps, because they guard their data like it’s gold. It also enables Lyft to call out each and every study that casts a negative light, calling them “deeply flawed” and untrue. But there are certain facts backed up by empirical data that is hard to argue against—though that doesn’t stop Lyft from arguing anyway.
General Motors is one of Lyft's major partners, and execs at Lyft explained that they will “work with GM to build a network of on-demand autonomous vehicles that will make getting around more affordable, accessible, and enjoyable.” That means less employees and contractors working for Lyft.
Yet there are still questions: will it be safe? Do people even want autonomous vehicles as much as the media would have us believe?
Contrary to popular belief, cities that have Lyft and Uber services have driving increases, rather than decreases (as the companies would like you to believe). A series of recent studies underlined the negative effects of rideshare companies, with one of the biggest detractors being that driving has increased about 3% when Lyft and Uber is involved, rather than cities without.
The app-based taxis have added 5.7 billion driving miles to nine major cities across the US—in Seattle, for instance, they’re providing 90,000 rides a day, which is more than the light rail system.
You might think that more Lyft drivers mean less driving overall, but you’d be wrong. Studies have shown that most people who drive are driving anyway, whereas Lyft is mostly replacing biking, walking, and transit.
A survey from a couple years ago found that 42% of riders would have taken transit if Lyft or Uber wasn’t available, 12% would have biked or walked, and 5% would have avoided the trip altogether. Lyft isn’t competitive with car ownership.
Even though Lyft argues against this, statistics have shown that drunk driving fatalities is essentially unchanged since the introduction of Uber and Lyft. The companies like to take credit for lower DUI levels in recent years, but what they don’t mention is that those trends were already beginning to decline before the apps were even available.
One of the reasons Lyft dramatically increases congestion is because drivers spend 40 to 60 percent of their time deadheading and riding around in circles. As Streetsblog reported, “Rideshare companies often subsidize drivers to stay on the road even when utilization is low, to ensure that supply is quickly available.” Many of these drivers are inexperienced in the areas they operate in, which creates a whole new slew of problems, too.
Mostly well-to-do people use Lyft and Uber, and those wealthy people often have more political influence than normal transit goers. For instance, every time someone hops in a Lyft because the bus or train is late, that degrades the usage and political support for mass transit.
Cities have tried to partner with the ridesharing apps—if you can’t beat ‘em, join ‘em—such as Denver partnering with Uber to win back riders. Right-wing politicians have argued that Uber and Lyft made transit investment unnecessary.
Not only does mass transit need to beef up their game, but Lyft and apps like it are hurting transit growth. In San Francisco, for instance, bus ridership decreased by 12% since 2010. Each year that the service is offered, the negative effect on transit only grows. Every person lured from a bus, train, or subway to a Lyft car adds congestion to the streets and emissions into the air. Seattle is investing $50 billion in light rail to combat rideshare apps.
Despite their stocks being relatively good, Lyft lost nearly $1 billion last year, and Uber lost $5 billion. The companies are relatively new, so this isn’t groundbreaking, but it shows a bad trend.
Lyft is still profitable, of course, but as a whole the two companies have posted huge growth and scarce profits in the meantime. It’s a bit complicated to explain the cost structure of the company compared to its gross profit, but these aren’t good numbers.
A study by the University of Chicago has found that Lyft and Uber have increased traffic fatalities by an astounding 1,100, because the Lyft and Uber drivers have basically zero safety training.
To make matters worse, cities like Toronto have eliminated safety training requirements for taxi drivers in an attempt to “level the playing field,” which is just bad for everyone.
This is a no-brainer, but it’s a terrible trend. Cities need to combat the overwhelming abundance of Lyft and Uber drivers on their streets. Research shows that the rate of rideshare and taxi ridership has increased exponentially since 1990.
Lyft and Uber adds 5.7 billion vehicle miles annually, just in the primary densest cities in America. Add in deadheading and substituting Lyft for buses and trains, and it more than doubles the vehicle mileage that the same set of trips would have generated if rideshare apps weren’t available.
Lyft doesn’t do a good job of staying on top of their drivers. As long as their ratings are high enough, drivers will continue to get rides. The company has been slow to impose limits on “drowsy driving,” even though fatalities have occurred where drivers fell behind the wheel after 12 hours of work.
A new rule states that drivers must take a six-hour break after driving for twelve hours straight, but that standard is much weaker than what the federal government requires of commercial drivers. Rider fatigue is a real, dangerous thing.
Greedy executives are in every sector, and Lyft is no different. This year, Lyft sued New York City to block a driver’s pay equity law from being enacted that would require ridesharing companies to pay drivers at least $17.22 per hour. Lyft said the new rule would make it difficult to compete with Uber, and they complained that the increase in wages would lead to an increase in rates for riders.
But New Yorkers saw past that ruse and know that it’s unconscionable for drivers to earn less than minimum wage, which many do.
This is one of the reasons why so many cars are added to traffic congestion in cities with Lyft and Uber: many passengers wouldn’t have otherwise used a car if it weren’t for Lyft. They would have gone with buses, trains, or subways. It would be smart for cities to try to limit the number of rideshare vehicles on the road at any given time, to dissuade this increase in traffic and emissions.
Transit systems around the country (and world) are losing the battle against Lyft and Uber. If they don’t adapt to the changing world, transit systems will be a thing of the past before long, which will negatively affect millions of people.
Lyft primarily operates in areas that have great transit as a way to steal business—such as Seattle. Lyft operates in dense, transit areas because they skew rich and young, where people are most likely to use the service.
When Lyft closed its F series of funding and secured $1 billion ($500 million from GM), they partnered shortly thereafter with Didi, China’s largest rideshare company.
More recently, they also partnered with GrabTaxi and Ola, which has expanded Lyft’s global footprint to astronomical proportions, offering service to nearly half the world’s population! That doesn’t bode well for worldwide congested streets.
References: theverge.com, usa.streetsblog.com, nymag.com, cnet.com