Lyft is a popular ridesharing app – also known as a transportation network company, or TNC – that’s available in several dozen American cities. Like Uber’s similar app, Lyft lets you electronically hail cars driven by independent contractors. In practice, it functions a lot like a taxi service, although it’s far more technologically sophisticated, tends to have shorter wait times, and doesn’t directly employ any drivers (its drivers are independent contractors).
It’s easy to sign up as a rider – you just download the app and input your name, phone number, and credit card number (which Lyft saves in its system). You pay by the ride, not by the passenger, providing an incentive to share rides with other passengers. I’ve personally used Lyft to get around my city, mostly after spending an evening out with friends.
- Request a Pickup. As soon as you download the app and your information has been entered into the system, you can request a ride. You don’t need to specify your destination, and Lyft uses GPS technology (via your cell phone) to ascertain your current location. The app pairs you with a nearby driver who’s available to accept fares, notifying him or her of your location. You’re notified when a driver is on the way.
- Track Your Driver. Lyft lets you track your driver while you wait to be picked up. You see a picture of the driver and his or her car, as well as a real-time map of his or her route to your location and an estimated arrival time.
- Riding. When your driver arrives, you tell him or her where to go. Lyft encourages you to ride up front, but you can get in the back if you’re more comfortable.
- Secure Payment. Lyft drivers are strictly forbidden from accepting cash payments or tips. When your ride ends, Lyft immediately bills your stored credit card. Fees vary by city. If you’re riding in Brooklyn, you pay a pickup fee of $3, $2.15 per mile, and $0.40 per minute, with a minimum charge of $8. In Albuquerque, you pay a pickup fee of $1.35, $1.85 per mile, and $0.20 per minute, with a minimum charge of $5. Lyft keeps 20% of this payment and passes the rest on to your driver, who is paid weekly.
- Rating System. Lyft uses a five-star rating system (one for terrible, five for excellent) to grade drivers and riders. When your ride ends, you have the option of using your app to provide a driver rating. He or she can do the same for you. If you rate a driver with fewer than three stars, the app ensures that you never ride together again.
- Receipt. Soon after your ride ends, Lyft emails you an itemized receipt that outlines your charges and summarizes your ride.
- Discounts and Referral Bonuses. Lyft may offer city-specific promotions, including ride credits for all new riders (the Pioneer program) and referral bonuses (delivered as ride credits) for existing users who refer new people to the app. Check your local Lyft branch’s Twitter feed or Facebook account for current information.
- Lost and Found Feature. At the bottom of your post-ride receipt, there’s a link to report items lost in your driver’s car. You briefly describe the item and submit, triggering an automatic text message to your driver. If the item is in your driver’s car, he or she can call you and arrange to meet or have the item shipped to you. Within this feature, there’s an option to tip drivers who go out of their way to return something.
- Prime Time. During peak periods, such as weekday rush hours or weekend late nights, Lyft may add a Prime Time surcharge to its standard fares. The aim is to encourage more drivers to hit the road during those periods. The app clearly indicates when Prime Time is in effect, and how much extra it will cost (this varies by location and rider demand, but surcharges of more than 100% are rare). The surcharge functions as a gratuity, with 100% going to the driver.
- Happy Hour. During off times, such as weekday overnights and weekend mornings, Lyft may offer discounted fares. The goal here is to encourage more riders to use the app and keep drivers busy. As with Prime Time, the app indicates when Happy Hour pricing is in effect and how steep the discount will be (discounts of more than 50% are rare). Drivers still get 80% of the fare. Lyft encourages tipping during Happy Hour.
- Safety Surcharge. To cover the cost of insurance for its drivers, Lyft levies a safety surcharge for every ride completed through the app. In most markets, this is $1, though it may vary on either side of that figure.
- Pink Mustaches. Possibly Lyft’s most important feature, the company’s drivers affix signature pink mustaches to the front of their cars. Though the tracking feature is very accurate, this visual cue confirms that your driver has arrived. Note that in cities that restrict transportation network companies, drivers may not display the mustache.
Driver Policies & Qualifications
Lyft requires its drivers to adhere to certain policies and meet certain qualifications:
- Personal Insurance. Drivers must carry auto insurance policies, subject to their state’s minimum requirements, on the vehicle they drive for Lyft.
- Additional Insurance Coverage Paid for by Lyft. Lyft pays for several insurance plans that kick in when a driver’s policy won’t cover an accident or when the cost of an accident exceeds their policy’s maximum coverage. These include a $1 million excess liability plan that covers driver liability for injuries to passengers, other drivers, and third parties; a $50,000 contingent comprehensive collision plan that supplement drivers’ existing comprehensive collision policies; a $1 million excess uninsured/underinsured motorist plan that covers injuries caused by at-fault motorists without sufficient insurance; and a $100,000 contingent liability plan that applies when drivers have the app turned on but aren’t on their way to pick up or drop off a rider. The first three plans apply when drivers are actively transporting or are on their way to pick up riders.
- Driving Record Check. Drivers must be 21 or older, have had a valid license for at least 12 months, have two or fewer minor violations (such as speeding less than 20 miles per hour over the limit) in the past three years, have no major violations (such as driving on a suspended license) in three years, and have no DUIs or extreme infractions (such as hit-and-run accidents) at any time whatsoever.
- Criminal Background Check. Lyft won’t work with drivers who have been convicted of crimes that are violent, sexual, property-related, drug-related, or felonies.
- Vehicle Standards. Drivers’ vehicles must be from the 2000 model year or newer. A Lyft employee conducts a 19-point, in-person inspection that covers tire quality, vehicle lights, and other important indicators of safety.
- Drug and Alcohol Use. Lyft doesn’t drug test its contractors, but it does enforce a zero-tolerance policy for drivers on the road. The company has a hotline you can call if you believe your driver is intoxicated.
- Rating System. If a driver’s average rating drops below 4.6 stars, Lyft terminates their membership.
I haven’t replaced my personal vehicle with Lyft yet, but it’s definitely another weapon in my transport arsenal. On a recent evening out, I found myself with no way to get home from a restaurant in a busy entertainment district with crowds of people milling about in wait for taxis. Lyft had recently set up shop in town, and this was the perfect opportunity to try it out.
I signed into the app, hit the button to request a pickup, and waited. Within a minute, my phone told me I’d been connected with a nearby driver. Sure enough, I could see a clear picture of him standing next to his car, pink mustache and all. As advertised, I could follow his progress toward my location. He arrived within 10 minutes, invited me to sit up front, and gave me a friendly fist bump as I closed the door and described my destination. (I learned later that Lyft strongly encourages the fist bump.)
The ride went smoothly. It was a straight, three-mile shot up a major avenue, so the driver didn’t need to use GPS or ask directions. His car was a surprisingly new, entry-level model of a luxury make, and I couldn’t help wondering if this side gig was really necessary. As we chatted, more naturally than I ever have with a cab driver, things made more sense – the driver, almost finished with his professional degree, was sorting through various job offers and living off a student stipend. His Lyft earnings helped with rent, car payments, and other expenses, but what kept my guy coming back was the element of surprise – the joy of meeting new people, learning new things, and exploring new parts of town. He didn’t rule out keeping the gig once he landed a career-track job, a ringing endorsement from someone who’d be pulling in who-knows-how-much next year.
When we arrived at my destination, my driver thanked me for joining him, wished me well, and politely refused my repeated attempts to offer a cash tip. (As a relative novice, I wasn’t aware of the option to tip by credit card.) As I leaned out the door, we fist bumped again. Within a few minutes of walking through my door, I had a detailed record of the transaction in my inbox. From door to door, the ride had taken just a few minutes longer than if I’d driven myself. And it cost just $7.50 – a bit more than half what I’d have paid in a taxi.
Lyft has some advantages relative to Uber and traditional taxi companies:
1. High, Clear Standards for Drivers
Lyft and Uber have roughly equivalent protocols for determining a driver’s qualifications and looking into their backgrounds. However, Lyft holds its drivers to higher and clearer standards of courtesy and professionalism. The company keeps a running average of each driver’s star rating, terminating drivers who fall below the 4.6 mark. Theoretically, a driver could receive across-the-board “4” ratings from every rider and still get the ax. While this seems harsh, it also increases the chances that your driver will be awesome.
Uber also has a five-star rating system, but doesn’t impose a minimum quality threshold. Its website says, “Have partner drivers been deactivated for consistently poor ratings? You bet,” without explaining what consistently poor ratings entail or how often this occurs. Meanwhile, many taxi companies lack any sort of standardized rating system. Instead, you might be prompted to call a hotline or supervisor with complaints about service, which may not have any negative repercussions for the offending driver.
2. Drivers Keep More of What They Earn
Lyft drivers keep 80% of the fare you pay at all times. Under normal circumstances, Uber drivers do as well. But during busy periods, when Uber institutes so-called surge pricing, it may take more than its 20% cut – exactly how much more is unclear. Meanwhile, taxi drivers’ pay varies by location and company, but it’s unlikely that any taxi driver takes home 80% of his or her fare. Taxi services, Uber, and Lyft all allow you to tip drivers over and above your base fare, so Lyft drivers are just as likely as their peers to benefit from additional generosity. Since Lyft drivers have the potential to earn more overall, they’re more likely to provide great service.
3. The Prime Time Surcharge Goes Directly to the Driver
Lyft clearly states that 100% of your Prime Time surcharge goes directly to drivers. Uber has a similar pricing model, called surge pricing, that increases fares during periods of peak demand. But the company makes no public mention about how the fee is used, merely stating on its website that “Uber rates increase to get more cars on the road and ensure reliability during the busiest times.” According to public statements from current and former Uber drivers, the company keeps a portion of its surge pricing surcharges for itself. Lyft claims to be the only ridesharing company that doesn’t take a cut of such surcharges.
4. Lyft’s Lost and Found Feature Is Superior
Uber’s lost and found feature isn’t as rider-friendly as Lyft’s. For instance, it doesn’t allow you to tip the driver for going out of his or her way to return the item, potentially reducing the incentive for doing so. It also requires you to initiate contact with the driver, raising the possibility that he or she could ignore your calls or texts.
Meanwhile, taxi companies don’t have a streamlined process for returning lost items. If you have the driver’s number, you can call him or her directly, or call the company’s headquarters. But it’s not common for cab riders to have individual drivers’ numbers, especially if they hailed the cab on the street. And in a dispute over the existence of an item, it’s your word against the driver’s.
5. Happy Hour Discounts Are Unique
Unlike Lyft, Uber doesn’t offer discounts during slow periods. Worse, some taxi companies may levy across-the-board night surcharges, regardless of demand. On weeknights, these could be in effect while Lyft runs Happy Hour pricing.
6. It’s Usually Cheaper Than a Taxi
Lyft’s prices vary by market, but it’s often cheaper than a taxi. For instance, on my aforementioned trip, I paid a $0.68 pickup charge, $0.22 per minute, and $1.71 per mile. The trip was just under three miles and took about eight minutes, bringing my total to about $7.50. By contrast, a popular local taxi company would have charged about $12 for the same journey. In Los Angeles, my Uber ride would have cost about $7.70, compared to about $11 for a taxi trip.
1. You Can’t Call or Hail Lyft Drivers on the Street
You must hail Lyft drivers through the company’s app. You can’t call up a particular driver to request a ride or flag down a passing, pink-mustached car. You can do both with traditional taxis, which may save time in busy urban areas or when you need to be picked up at a specific time (for instance, to make an early-morning flight).
2. Uber Is In More Cities
Though each company’s count fluctuates as it expands into new territories, Uber currently has a foothold in more places than Lyft. In the United States, Lyft is currently in about 70 cities, including metropolises, such as Los Angeles and Chicago, and smaller cities like Madison and Corpus Christi. Uber is in about 90, including dispersed vacation communities like the Hamptons and the Jersey Shore.
Uber also has drivers in several dozen global cities across 41 countries. Lyft doesn’t have any presence outside of North America. If you’re traveling abroad, or even vacationing in certain parts of the U.S., you have to go with another option.
3. Uber Often Covers More of Each City
Though coverage varies by city, Uber generally covers more of each location. For instance, its Phoenix-area coverage spans nearly the entire built-up zone, including outlying suburbs such as Avondale and Queen Creek. In the Baltimore area, it covers a region from Gibson Island in the southeast to Lutherville in the northwest.
By contrast, Lyft only covers the parts of Phoenix inside the 101, 202, and 10 freeways, cutting out many outlying communities. Likewise, Lyft’s coverage barely extends beyond Baltimore’s city borders. Further, Lyft designates special Hot Zones (typically central business districts or university areas) within each city. These receive the bulk of its traffic, so you may have trouble finding a driver quickly if you’re beyond their borders.
4. Lyft Doesn’t Accept PayPal or Google Wallet
If you don’t want to give Uber your credit card information, you can pay its fares with Google Wallet or PayPal. Lyft doesn’t accept these payment methods – nor cash – so you’re forced to keep your credit card on file.
5. Drivers May Not Be as Experienced as Taxi Drivers
Lyft isn’t subject to the same regulations as taxi companies, which has caused friction between it and taxi operators in some cities. Although the company subjects drivers to a criminal background check and driving record check, they don’t have to have any prior commercial driving experience – or a commercial driver’s license – to begin accepting rides.
This raises the question of whether it’s less safe to use Lyft than a traditional taxi service. Though no Lyft drivers have yet been implicated in fatal traffic accidents, a driver for Uber – which uses a similar vetting process and also doesn’t require previous commercial driving experience – was involved in a hit-and-run accident with a San Francisco pedestrian on December 31, 2013, according to ABC 7 News.
The ridesharing industry remains in the early stages of development. Though Lyft is rapidly expanding to large and medium-sized U.S. cities, it hasn’t been a uniformly smooth expansion. Due to concerns over driver liability, as well as pressure from local taxi commissions, some municipal governments have resisted Lyft. For instance, in early 2014, Seattle forbade transportation network companies from contracting with more than 150 drivers apiece, though that cap has since been relaxed. Others have taken an even harder line: Both Austin and Memphis have banned transportation network companies altogether, with Memphis threatening drivers with arrest under a law that prohibits unlicensed taxi services.
Though such restrictive policies could change, you need to be aware of the current rules in your area. With aggressive expansion strategies, transportation network companies have been known to operate in cities where they’re formally prohibited. (For instance, both Lyft and Uber operate in Austin, just without any official signage.) This may result in uneven service when the rules are being enforced – if word of a driver’s arrest spreads, other drivers might stay off the road.
I had a great experience with Lyft, cutting a significant amount off a standard taxi fare and enjoying a rewarding interaction with a friendly driver. You can aspire to such an experience too – as long as you’re conscious of Lyft’s limitations. Most importantly, you need to make sure Lyft is authorized to operate in your area. Be aware of your city council’s position on the service, and think twice about using the app if it might land your driver in legal trouble. Pay attention to your city’s hot zones as well – your experience may be faster and smoother if it begins within one. And since Lyft charges by the minute, use it for point-to-point trips, not round trips.
Lyft is quirky, fun, and easy to use. While it won’t replace your car, it may be a superior alternative to taking a taxi. And even if it’s not available in your city at the moment, its rapid expansion means that it could be soon.
4.2 out of 5 stars: The experience side of Lyft is fantastic, with great community, friendly drivers, ease of use, and shorter wait times than taxis. Relatively thin coverage and the requirement that you use a credit card are the principal drawbacks.
Have you ever used Lyft? Would you again?