While Uber Technologies Inc. and Lyft Inc. prepared this week to close on riding dogs in California, alternative modes of transportation on-demand say they are ready to pick up the slack.
Uber UBER,
and Lift LIFT,
must obey a San Francisco Superior Court judge’s order by midnight Thursday night to classify a California law and classify its drivers as employees instead of independent contractors, unless they win appeals they file with the state. Both companies are fighting the law, saying the transition would be time-consuming and cumbersome. Riders in California on Tuesday began receiving notifications from the app that they would likely stop their ride-healing service if they were forced to comply, after drivers publicly said the same thing last week.
See: Uber and Lyft have to make drivers employees because California law has ‘overwhelming’ edge, judge says
In the home of ride-hailing apps, people have used the services for rides to work, medical appointments, shopping and other necessary activities during the pandemic. However, with their expected shutdown, taxicabs – which were replaced by the rise of Uber and Lyft – have a chance to take over that company.
The shutdown of the apps “could be a big shot in the arm for taxis,” Mark Gruberg, a taxi driver and board member of the San Francisco Taxi Workers Alliance, said in an interview.
Gruberg, who said he had stopped driving because he did not want to risk his health during the COVID-19 crisis, pointed out that drivers are currently facing “very hard choices”. But as the demand for rides climbs, he thinks some cabdrivers will come back.
San Francisco cab company Flywheel offers an app experience similar to that of calling an Uber or Lyft on a user’s mobile phone, but it calls a taxi cab. The company of 300 cars is running in preparation.
“Our drivers are skinny, mean, hungry and waiting to pick up business,” said Hansu Kim, owner of the business, in an interview. Kim added that “Flywheel will be absolutely ready to embrace Uber and Lyft drivers to drive a taxi cab in a regulated and legal manner.”
Riders say they may switch to taxis, but have not forgotten the problems that made it easy for Uber and Lyft to take over the traditional cab companies, such as avoiding certain neighborhoods in San Francisco.
“I imagine downtown is still pretty dead, so maybe (cabdrivers) would hit the Sunset and Richmond more these days,” said Kevin Murphy, who has taken Lyft to and from work because city buses run fewer routes. “Cabdrivers generally hate to drive out here because I think it’s harder to get another ride. Most, but not all, were pretty aggressive and rude about it back to Lyft and Uber. Half the time they came out to me once I told them where I was going. ‘
Public transportation is an option, but is not as reliable as fast as it used to be, because the Muni of San Francisco, for example, has fewer routes available due to a drop in demand. As of this week, demand for public transportation in the Bay Area was down 84% compared to last year, according to Transit, which bases its estimates on the number of times its app is opened in an area it serves.
Another alternative for those who do not have a car is a car sharing service, or services on demand that offer more flexibility than traditional car rental. The cars can be rented by the hour, during the day or longer, and do not normally have to return to the same place as they were picked up, because the companies that own the cars have special arrangements with municipalities, which determine where the cars can be parked.
One such service is Gig Car, which is owned by AAA Northern California. It serves the Bay Area and Sacramento, and was launched last month in Seattle. It has more than 65,000 members, according to spokesman Sergio Avila.
Like other modes of transportation, Gig Car has seen less demand for its cars (mostly Toyota Priuses) during on-site orders, but Avila said the service is starting to rebound. A similar service, Zipcar Inc., a subsidiary of Avis Budget Group Inc. CAR,
says it has nearly 1,000 cars up and down California.
One more alternative does not include cars, and comes from Lyft itself: A spokeswoman says a shutdown will not affect scooter and bike rentals. Uber intends to maintain its Uber Eats delivery service, even if it shuts down the ride-healing service.
See: Even if Uber rides stop in California, Uber Eats still has a green light
California accounts for 16% of Lyft’s business, executives said recently, while Uber receives 9% of its business from ride-healing in California. At this point in the COVID-19 pandemic, however, the demand for rides in the state is significantly down, as California remains in place under orders.
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