The ride-hail/taxi war

The ride-hail/taxi war

Lyft and Uber are spreading throughout Toronto and Ottawa in a bid to increase their market share.

On November 13, 2017, the San Francisco-based ride-sharing service Lyft announced it would be expanding its service beyond US borders for the first time and launching in Toronto.

Delivering on-demand taxis to riders that summon them with a mobile app, Lyft will compete with Uber, along with traditional taxis. As a result, Lyft began searching for drivers, who could apply for jobs via the mobile app, with the aim of starting to operate in time for the holidays.

A year later, Lyft is toasting its first year in the Toronto region and eyeing services beyond ride sharing, but it will have to step on the gas to catch up with rival Uber.

Lyft chose Toronto as its first city for international expansion in response to notable demand for the service, Lyft General Manager Tim Houghton told the CBC’s Metro Morning program in an interview. By the end of 2017, 50,000 people in Toronto had downloaded the Lyft app, which is to say, before the service was even up and running.

“We’ve really worked hard with the city regulators to comply with the regulations they came up with for ride-sharing last year,” Houghton said at the time. “It’ll be great for users to have a choice.”

Lyft arrived more than five years after Uber barged into Toronto with lobbying efforts that, over the objections of the traditional taxi industry, helped produce legislation legalizing app-based “private transportation companies.”

Lyft has since expanded to Ottawa and positioned itself as aligned with Canadian values, opening driver “hubs”, helping raise more than $50,000 for the SickKids Foundation, and offering free rides of up to $15 in value to or from North York subway stations immediately after the Yonge St. van attack.

Lyft also owns Motivate, the world’s biggest bike-share company, which currently offers electric scooter rides, unlocked with an app, in nine US cities.

John Zimmer, co-founder of Lyft, has suggested in public interviews that his company will continue with a slow-and-steady approach to the Canadian market where regulations have yet to be written for electric scooter services.

Meanwhile, regulations for ride-hail services and the wider taxi industry in Toronto could soon change. City staff are set to produce a report in June on how the current rules are working and suggest changes to the city council.

Asked how Lyft would view any new regulatory requirements, Zimmer chose his words carefully. He noted that, according to the company’s economic impact figures, 91% of local drivers work for Lyft fewer than 20 hours per week.

Uber highlights 2018 research by experts including a University of Toronto researcher that concludes Uber is a “complement for the average transit agency, increasing ridership by 5% after two years.” But other studies, including a new one from the University of Kentucky, argue that most U.S. cities have seen rail and bus ridership slip since ride-hail services rolled in.


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