Automotive > Connected Mobility Blog

Lyft's Partition Proposition #Fail

by Roger Lanctot | 7月 20, 2020

In his account of former Uber founder, Travis Kalanick's, rise and demise, "Super Pumped," New York Times correspondent Mike Isaac recounts the impact of the arrival of Lyft on the ride hailing scene. Prior to lyft's emergence, Uber had relied solely on for-hire operators like limousine drivers to populate its transportation network. It was Lyft that committed the original sin of enabling regular citizens with ordinary Class C licenses to become ad hoc taxi drivers.

Seeing Lyft (and rival Sidecar) enabling peer-to-peer ride hailing for the masses, Uber launched UberX. While Uber subverted or overwhelmed regulators in its early days, it was Lyft that directly violated the rules of taxi licensing. It was Lyft that pushed Uber over the line. Writes Kalanick in a blog at the time: "We could have chosen to use rgulation to thwart our competitors. Instead, we chose the path that reflects our company's core: we chose to compete."

Isaac says it was this turning point that put Uber on a path to compete with and/or replace all modes of transportation from privately owned vehicles to public transit. The resulting decisions of beaten down regulators to facilitate rather than regulate ride hailing operators has been both a boon and a bane for the likes of Uber and Lyft.

When the coronavirus pandemic set in globally four months ago ride hailing operators around the world saw their business plunge by 70%-80%. A subsequent scramble commenced to launch, expand, or acquire food and package delivery operations - which suddenly represented the only path to preserving revenue streams and growth.

Regulators remained on the sidelines. Mask requirements were never enforced on transportation network companies (TNCs) like Uber and Lyft - when, arguably, they ought to have been shut down. Uber, Lyft, et. al. have been coronavirus superspreaders throughout the pandemic untouched by sanctions or penalities. As a charitable gesture many provided free transportation for essential workers - primarily healthcare personnel - without adopting sufficient safety measures intended to adequately protect drivers or passengers.

It was more than three months before Uber and Lyft began requiring drivers and passengers to wear masks. In contrast, the largest TNC in the world, DiDi Chuxing, invested $14M in outfitting its cars with partitions to protect drivers and passengers. Some others, such as Bolt, Alto, and Yandex, have followed suit. But not Uber and Lyft, until now.

Lyft announced this past week that it is beginning to roll out vehicle partitions to drivers in accordance with Center for Disease Control recommendations. Lyft says it began providing partitions to frequent drivers, including those in its Express Drive rental program, in Atlanta, Denver and Baltimore. "Following positive feedback from drivers and riders, we’re now providing partitions to additional drivers in Washington, D.C., Los Angeles, Seattle, Boston, Phoenix, Dallas and New York City," writes Lyft.

"In the next month, we will have made tens of thousands of partitions available to U.S. drivers for free, with the goal of providing 50% ride coverage in these markets. We plan to expand to a total of 30 regions and provide partitions to a total of 60,000 drivers in the coming months." Partitions will be available for all drivers to purchase through the Lyft Store, the company says.

Lyft blog: https://www.lyft.com/blog/posts/lyft-expands-health-safety-program

CDC recommendations: https://www.cdc.gov/coronavirus/2019-ncov/community/organizations/rideshare-drivers-for-hire.html

This proactive move by Lyft is a powerful differentiator with Uber, which has made no such announcement. CNN reports that "Lyft says drivers will be able to indicate within the company's consumer app that they have installed a partition, but riders are not able to select that they only wish to ride in vehicles with a partition."

This seems like a minor quibble, but it underscores the regulatory dilemma facing Lyft, Uber, and all other TNCs. If regulators do not require a partition, convincing drivers to add partitions is an iffy proposition with a contractor-based workforce. Uber and Lyft drivers are not company employees and, as such, are disinclined to do anything they are not required to do.

When Uber launched its masking requirement it included a selfie-validation step in the app to confirm the driver's masked state prior to each drive. Lyft has a similar masking requirement, but I have had Lyft rides without myself wearing a mask since it was instituted. Providing partitions rather than requiring drivers to acquire and install them is a proposition destined to fail.

Unfortunately for Uber, Lyft, and other TNCs, the partition proposition is existential to the future of the entire sector. The ebbing (and flo-ing) of the coronavirus pandemic has left the ride hailing bubble largely deflated.

A reader of Isaac's "Super Pumped" will know that the sector is fueled and supported by relentless growth. TNCs have hired thousands of engineers to capitalize and expand on their platforms moving beyond ride hailing to package and food delivery, public transit integration, personal services, and payments. Without growth, most of these companies have begun paring back, laying off thousands, and dialing back innovation and expansion.

Ride hailing is the massively profitable engine of that growth. TNCs may have wrestled regulators to a draw and pushed them out of the way, but the industry has yet to come to terms with the long-term impact of the coronavirus.

At the core of its response to COVID-19 is a need to adopt in-vehicle partitions. As part of a broader effort to deliver a more reliable service proposition through a network of contractors, TNCs around the world must find a way to require their drivers to install protective barriers.

There are cost-related and logistical issues to overcome. Some operators acknowledge the need for partitions but note the supply-chain challenges of getting the proper equipment tooled, manufactured, and shipped in quantity - let alone the process of distributing the equipment to drivers and establishing proper installation. Even such trivial issues as seat position must be taken into account as pictured (below).

No alt text provided for this image

SOURCE: Lyft driver with differing driver/passenger seat positions.

Lyft has taken the first steps in creating a product - having it manufactured - and delivering it to at least some of its drivers. For Lyft's partition "gesture" to become a leverage-able brand asset, though, the company must REQUIRE drivers to acquire and install partitions and highlight their availability and presence via the Lyft app.

No alt text provided for this image

SOURCE: Strategy Analytics consumer survey of post-COVID transportation plans

Lyft's partition launch is a major leap forward for the TNC sector. Lyft must do more to achieve any real traction. By now we all know that masks are not enough. The coronavirus pandemic has undermined passenger confidence as revealed in Strategy Analytics surveys - and that threatens the brand disruptive dreams of all TNCs. When it comes to partitions in ride hailing vehicles it's time for operators to put up or shut down.

 

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