It seems that there are a time and place for everything and Lyft have been taking a slow but progressive step by step approach to expansion. Now that they have saturated the US market, reaching close to 30% of all ridesharing around the US, they have decided it's time to reach out and become a global company.
Lyft is a CA-based ridesharing company that has been Uber's main competitor only in the US, until now.
Lyft is not going on a global rampage similar to Uber's style of conquest, but are taking a more conservative approach in line with their steady business growth model. Their first step outside the US border is in Toronto, Canada. The new office will be opened in time for the holiday season.
Lyft has started to raise its head since Uber started to falter due to excessive mismanagement and a lot of overreaching without regard for cost or profit. Lyft started to look into an IPO set for 2018 and in the meantime, is completing a $1 billion investment from Alphabets investment subsidiary Capital G. Lyft has also been involved in the race for a viable self-driving car, and in September signed an agreement with Ford Motor Company, partnering with them, to develop the autonomous car with a site being opened for this purpose in Palo Alto, California.
Lyfts next step, expansion outside of the US is the next step in its constant challenge for market dominance. Logan Green, Lyfts CEO stated that they have been planning global expansion for a while but waited for the right moment. Lyft's President and co-founder John Zimmer said that he expects Toronto to become one of Lyfts major cities.
Lyft has started a driver recruitment promo where they offer a 25% bonus for 3,000 of the first applicants approved to drive for them, and which will complete 20 rides per week in the first three months of operation. Lyft will also operate in all of Toronto's suburbs as well as in neighboring city Hamilton, Ontario.
Uber in Canada
Toronto is a city of over seven million and Mississauga, Toronto's largest suburb with Toronto's international airport in its area has already allowed Uber to work on a trial basis since March 2017 and it will review the contract and rules in 2019.
Uber started working in Toronto in 2012 met stiff resistance from Taxi drivers claiming that Uber should operate under the same rules as Taxi drivers adhere to. Toronto's Supreme Court ruled back in 2015 that Uber could continue to operate as it does so that squashed the resistance. It also set the path for ridesharing companies to come into Toronto.
Uber opened a research center in Toronto, investing in the city's infrastructure and education by opening an AI research facility. General Motors, Uber's AI driverless car Partner claimed that it would increase the number of software engineers in Toronto by 700.
Uber has pushed all opposition aside through some serious and intelligent investment operations and has quelled the Taxi insurgence completely. Uber has been in a constant repair mode ever since their new CEO Dara Khosrowshahi took office. He has set a new tone and culture and intends to work with local government rather than oppose them. The latest upset came from a London Transport Tribunal that rejected Uber's claims that all drivers were independent contractors, and places a minimum wage restraint on Uber. This came after a September ruling that stared that Uber was not "fit and proper" to operate in the British capital, which was a major blow on the global scene since London is Uber's largest market outside the US. In fact, London's rulings have spearheaded global understanding that what is right in the US is not necessarily right in other countries and we are seeking ripples of discord in other places, such as Nigeria.
Lyft's announcement came in just after Uber finalized its Softbank (Japan) deal, where Uber receives an injection of $1 billion in cash and a further $9 billion is being negotiated to buy 14% of the Uber stock from employees and other investors. This will give Uber a chance to reach their IPO in 2019 and retain their market dominance in the US and around the world.
Lyft Abroad
Before Uber's mid-year crisis, Lyft only held a small percentage of around 11-15% in the US market. This percentage included all of Uber's services as against Lyfts, where Uber also had various delivery services that Lyft does not. However, when concentrating on the ridesharing market alone, Lyft's percentage reached closer to 20%. Uber's market share calculations started out at in 2017 showing 80% in 2017, but now they show that Uber only controls 70%.
Lyft has remained in the US due to its business model concentrating on reaching profitability before full expansion. Lyft has been in negotiations with the City of London Transport Authority and based on what has been happening there with Uber; they now have a business model they believe the LTA will approve, opening Lyft up to a major market outside North America.
Lyft's image is better than Ubers in fact, it has a real image of caring for its drivers as much as its passengers, and the corporate culture has ways been about treating people well, as stated by their President and co-founder Zimmer.
An interesting statement of support came from an unexpected site, the Operations manager for Beck taxi in Toronto, Kristine Hubbard stated that they would not block Lyft, and claimed she would compete with them as she competed with other before. Whether this is lame bravado or a real challenge remains to be seen.