In May, Lyft launched a program to compete with Uber's black car and SUV services. Drivers had to pony up $34,000 to purchase the "tricked-out" Lyft-branded Ford Explorers just to get into the pool. But the luxury pilot bombed, leaving "Lyft Plus" drivers with the expensive SUVs they were forced to buy.
The screw started from the onset, when Lyft reportedly assured their Plus drivers to "[not] worry about demand; we have that covered." But the startup's fist-bumping clientele wasn't hot for the double-priced rides, and drivers were soon assigned regular fares just to stay busy. Now the company has given up marketing the SUVs to business elites and slashed prices by 25 percent.
"Overwhelmingly we were getting $5 or $6 rides; we can't afford it with the gas for those expensive cars," one driver said. "They get 14 (miles per gallon) in San Francisco."
SFist reports Lyft is offering to either help their Plus drivers sell the trucks or give them a $10,000 bonus (which would be subject to income tax). But the bail-out deal has been met with mixed results. Some drivers say they didn't lose money on Lyft's premium service experiment, but others claimed to the Chronicle that they got taken:
Several drivers said they had made life changes: selling existing cars, borrowing money from relatives, even forgoing other job opportunities for the chance to make more money with Lyft Plus.
"They pulled the plug, leaving us high and dry."
It's the new way "the sharing economy" lives up to its name: sharing the cost of failed product launches with 1099 contract employees. Just another cost of doing business for Silicon Valley's micro-entrepreneurs.