by Timothy B. Lee originally published on December 28, 2014
Last month, I spent a week working as a Lyft driver. Here are 5 things that surprised me about the experience.
1) In DC, many Lyft drivers don't make much more than minimum wage
I got lucky. I drove at a time when Lyft was guaranteeing new drivers that they'd make at least $30 per hour if they drove 50 hours in one week. But if that guarantee wasn't in effect, I would have made less than $12 an hour. Once you factor in gas and other expenses, my earnings would have been around Washington DC's minimum wage, $9.50 per hour.
My low earnings were partly due to my own inexperience. But my reporting suggests that — at least in the Washington DC area — my earnings weren't too far out of the ordinary. Drivers told me they made $12 to $15 per hour — and more like $9 to $12 per hour once you factor expenses in.
Driving for Lyft is great if you care a lot about flexibility. But it's not a way to make a lot of money.
2) Real Lyft customers ride in the front
Before I spent a week as a Lyft driver, I'd never given much thought to the difference between the different ride-sharing companies. Uber and Lyft seemed as different to me as Coke and Pepsi. But some of the Lyft regulars I met had strong feelings about the companies — and the differences between them.
It was easy to figure out who the committed Lyfters were because they sat in the front without me suggesting it. Some told me they didn't like the way Uber passengers, like traditional taxicab passengers, sit in the back. They preferred Lyft's egalitarian vibe.
Many Lyft regulars were also turned off by what they saw as the arrogant attitude of Uber management. Some cited a recent controversy over Uber's recruitment practices: Uber representatives had hailed Lyft drivers in order to pitch them on switching to Uber, which rubbed many people the wrong way. (For what it's worth, this didn't seem like much of a scandal to me.)
3) Lyft riders hate Uber's surge pricing
The thing Lyft customers seem to hate the most about Uber is surge pricing. That's when Uber automatically raises prices during periods of high demand.
People have been complaining about surge pricing for as long as Uber has used it. Still, talking to a bunch of Lyft customers helped me appreciate how strong anti-surge-pricing feelings are. My passengers mentioned it more than any other Uber complaint, when I asked them about the two companies.
That's a bit surprising because Lyft actually does something similar. But Lyft's version of surge pricing, known as prime-time bonuses, seems designed to enrage customers less. Uber has been known to jack up the price of a ride as much as eightfold. In contrast, Lyft almost never raises prices by more than 200 percent. And customers told me that they see elevated prices less frequently on Lyft than on Uber.
The economic argument for surge pricing is impeccable: varying prices helps to balance supply and demand, ensuring that people who really need a ride can always get one. But businesses have to take customer preferences into account whether or not they're rational. So it might make sense for Uber to adopt Lyft's softer approach to demand-based pricing.
4) Some parts of Lyft are surprisingly low-tech
To become a Lyft driver, you have to fill out an application using the Lyft app. Then, within a matter of hours, the app connected me with a "mentor" — an experienced Lyft driver who checked out my vehicle and answered my questions. These early steps were so streamlined that I expected the rest of the process to go smoothly too.
But that's not how it turned out. A week after I submitted my application, I got an email asking me to drop by Lyft's DC office to complete my application. I thought I already had completed my application, so I ignored the email. Then I got another email the next week.
Lyft's DC office consisted of a couple of guys at a co-working office. One of them figured out the problem with my application: because I had lived in DC less than a year, I needed to submit my driver's license number from Pennsylvania, where I had lived previously. But the Lyft app hadn't asked me for that information originally, and there was no way to submit it electronically. I had to visit the office a second time with my Pennsylvania license in hand.
In short, behind the scenes, Lyft looks a lot like any other bureaucratic company with confusing processes.
5) The Lyft app has some frustrating bugs
Lyft offers a "power driver bonus" that pays drivers up to 25 percent extra if you drive at least 50 hours/week. But to qualify for this bonus (or the $30/hour guarantee in effect at the time I drove), drivers must accept at least 90 percent of the hails they receive.
That turned out to be stressful, because sometimes I'd miss hails due to no fault of my own. On three separate occasions, I'd pull out my smartphone and have the Lyft app scold me for failing to accept a ride request. It advised me to turn the app off if I wasn't available to pick up passengers. But I was available to pick up passengers and I had my phone with me the whole time. It just didn't make any noise.
This bug was stressful because I didn't have a very big margin for error. I would only have 54 passengers, so I couldn't afford to miss more than 5 hails. And in practice, this meant I couldn't deliberately decline any hails because I couldn't predict how often the app would malfunction later in the week.
In the end, everything worked out. I "missed" three hails for a total acceptance rate of 95 percent. But for much of the week, I worried that connectivity problems would push me below 90 percent.
Another annoying bug: at the end of a ride, the driver is supposed to tap the "drop-off" button to indicate that the ride is completed. A couple of times I forgot to do this until later. But the Lyft app doesn't have any way for the driver to report this kind of mistake. I was forced to just tap the drop-off button late, generating a $44 bill for a ride that should have cost about $7.
Eventually, I got this charge corrected by emailing Lyft customer support. But in the process, it created needless confusion for the customer, who thought she was going to get charged the full $44.
Update: Shortly after writing that Lyft never raises prices by more than a factor of two, I saw that Lyft had temporarily increased the maximum prime time rate to 400 percent (meaning passengers can pay up to five times the normal rate) for New Year's Eve. I've updated the article accordingly.