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TechLyft

Lyft has some new ideas for making its drivers happy

By
Kia Kokalitcheva
Kia Kokalitcheva
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By
Kia Kokalitcheva
Kia Kokalitcheva
Down Arrow Button Icon
October 8, 2015, 5:22 PM ET

Amid its intense battle with ride-hailing rival Uber, Lyft is introducing new products and programs for it drivers to help with retaining them and attracting new ones.

On Thursday, the company announced partnerships with Hertz and Shell, along with a new tool that lets drivers collect their pay more quickly.

“We want to ensure that we’re the company that treats you better than anyone else,” said Lyft co-founder and President John Zimmer, whose company has 100,000 drivers who complete 1 million rides weekly.

Lyft and Uber have long competed to sign on as many drivers as possibly by offering cash bonuses for joining, through advertising campaigns, and even by running covert programs to poach drivers from each other. The number of drivers is critical for success because it translates into passengers being picked up more quickly.

Through a partnership with Shell, Lyft will offer drivers discounts on gas, which is one of their biggest job expenses. Based on the number of rides they complete each week, drivers will be able to earn discounts of anywhere from 3 cents per gallon to free tanks of gas, Lyft said. Drivers get personal codes that they can enter at the pump to get their cheaper gas based on the rewards they have earned. In June, Uber rolled out its own program for gas discounts for drivers through a partnership with Fleetcor and MasterCard.

Lyft also announced a deal with Hertz (HTZ) to provide its drivers with lower daily, weekly, or monthly car rental rates. The goal is to open the door to would-be drivers who don’t own a car or whose car doesn’t meet Lyft’s standards. The company said that about 20% of driver applicants are turned away because their cars aren’t new enough, or have four doors, among other things. Though it didn’t share any specific numbers, Lyft claims the rental rates will be low enough so that drivers can actually earn money after paying the fees Lyft collects from them for every ride. Lyft drivers will have to use the car to driver only for Lyft, although it’s not clear if and how the company could monitor if drivers use it to work for other ride-hailing services as well. Interestingly enough, this also loosely resembles how taxi companies, whose drivers rent the cars from the taxi company and pay a daily fee.

But it’s not the first ride-hailing company to attempt to solve this. In July, Uber launched a new version of its car leasing program with lower monthly payments for drivers, this time with more flexible terms, such as being able to return the car with only a two-week notice. Startups like HyreCar and Breeze have cropped up over the past couple of years to provide exactly this type of short-term rental cars for people who don’t own a car that meets Uber or Lyft’s standards.

Lyft is also creating a new way for drivers to get paid more quickly. In early November, Lyft will roll out Express Pay, a new feature that will let drivers get access to their earnings once they’ve made at least $50. Drivers will receive the money on the same day or the next, depending on their bank. Drivers will pay a 50 cents fee for using Express Pay.

Earlier on Thursday, Lyft made headlines after Reuters reported, citing anonymous sources, that CTO Chris Lambert has illegally accessed rival Uber’s system and downloaded lists of driver names and other information. Eight months ago, Uber disclosed a 2014 data breach and has filed a lawsuit in San Francisco federal court to subpoena information to help uncover the hacker. An IP address has been identified as having access to a security key used in the breach, court documents don’t draw a connection to the breach’s hacker.

When asked about the accusations, Zimmer declined to comment to Fortune, adding that the company was currently focusing on its new business partnerships.

For more about Lyft, watch this Fortune video:

(The story has been updated with a clarification of why 20% of Lyft driver applicants are turned away, and a mention that Uber has previously rolled out its own gas discount program for its drivers.)

About the Author
By Kia Kokalitcheva
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