Lyft Cuts Fares in More Cities Last Week
Sorry I am a bit late in reporting this due to being really busy with other things.
Two weeks ago, I heard from other drivers about rate cuts in their cities. Later that day, I ran a quick check to make sure I knew which rates dropped and found that rates were already cut in Miami. Surprisingly enough, Pittsburgh got a rate increase.
Miami: There was a 15% decrease in June
| 6/5/2015 | 6/25/2015 | June Decrease | |
| Base | $ 1.13 | $ 1.00 | -12% |
| Cancellation | $ 5.00 | $ 5.00 | 0% |
| Minimum | $ 5.00 | $ 5.00 | 0% |
| Mile | $ 1.10 | $ 0.90 | -18% |
| Minute | $ 0.18 | $ 0.15 | -17% |
Pittsburgh: There was a 20% rate increase in Pittsburgh:
| 6/5/2015 | 6/25/2015 | June Increase | |
| Base | $ 1.35 | $ 1.70 | 26% |
| Cancellation | $ 5.00 | $ 5.00 | 0% |
| Minimum | $ 4.00 | $ 4.00 | 0% |
| Mile | $ 1.13 | $ 1.30 | 15% |
| Minute | $ 0.27 | $ 0.32 | 19% |
More Fare Cuts
But on June 29th, there were four more cities that got rate cuts: Atlanta, Austin, Denver, and Nashville. You can see the details below:
Atlanta: They got a 16% rate decrease:
| 6/28/2015 | 6/29/2015 | June Decrease | |
| Base | $ 1.35 | $ 1.15 | -15% |
| Cancellation | $ 5.00 | $ 5.00 | 0% |
| Minimum | $ 6.00 | $ 6.00 | 0% |
| Mile | $ 1.29 | $ 1.00 | -22% |
| Minute | $ 0.17 | $ 0.15 | -12% |
Austin: They got a whopping 25% decrease:
| 6/28/2015 | 6/29/2015 | June Decrease | |
| Base | $ 1.35 | $ 1.10 | -19% |
| Cancellation | $ 5.00 | $ 5.00 | 0% |
| Minimum | $ 5.00 | $ 5.00 | 0% |
| Mile | $ 1.70 | $ 1.30 | -24% |
| Minute | $ 0.27 | $ 0.18 | -33% |
Denver: They got a 14% decrease
| 6/28/2015 | 6/29/2015 | June Decrease | |
| Base | $ 1.13 | $ 1.05 | -7% |
| Cancellation | $ 5.00 | $ 5.00 | 0% |
| Minimum | $ 5.00 | $ 5.00 | 0% |
| Mile | $ 1.41 | $ 1.10 | -22% |
| Minute | $ 0.17 | $ 0.15 | -12% |
Nashville got a 11% fare decrease:
| 6/28/2015 | 6/29/2015 | June Decrease | |
| Base | $ 1.13 | $ 1.00 | -12% |
| Cancellation | $ 5.00 | $ 5.00 | 0% |
| Minimum | $ 4.00 | $ 4.00 | 0% |
| Mile | $ 1.10 | $ 1.05 | -5% |
| Minute | $ 0.18 | $ 0.15 | -17% |
Why the Fare Cuts?
After double checking the rates on Uber, Lyft’s rates are almost in line with what Uber charges. I know in Nashville Uber is much busier than Lyft but could only guess that Lyft hasn’t really caught up to Uber in the other markets as well. There are plenty of markets that Lyft has higher rates in and they could be lowering the rates to try competing with Uber in these few markets.
It is also surprising that they decreased rates in Austin that much. I have heard good things about Lyft in Austin so I can’t see why there isn’t enough passengers there. It could be that Uber is much bigger than Lyft and Lyft wants to better compete.
Unfortunately, this is bad news all around for drivers. Small decreases (~10%) may not affect earnings that much but in some cities, the cuts are as large as 25%, so I would expect lower earnings in those cities. Unless you average about 1-1.5 trips an hour, these fare cuts won’t be increasing your earnings. It may boost earnings for daytime drivers as they may be busier, but will decrease earnings for drivers who drive during peak times. Hopefully the fare cuts will increase demand and increase the occurrence of Prime Time. There were a few times that did happen in other cities, but in the long run, supply and demand evens out and drivers end up making less after these fare cuts.
Have you seen these fare cuts yet? How has that affected your driver income? You can post your thoughts in the comments below!
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