Lyft just gutted their premium Lyft Plus service, leaving drivers with $34,000 luxury SUVs. Now the on-demand ride company is screwing their drivers again, slashing rates by ten percent in Los Angeles.
Lyft announced the cuts in an email to all drivers, reminding them "the more you make, the more Lyft makes, so your earnings are our top priority." But one Lyft driver explains to Valleywag that drivers aren't buying it:
Please bear in mind, drivers in LA were barely making more than minimum wage prior to today's 10% price decrease. Drivers are pissed off. There will still be people desperate enough for money that will be driving, of course. Until their tires blow and they can't afford to replace them. Or until tax time.
Lyft is [engaged in a] price war with Uber. And they're conducting this war on the backs of their drivers (and cars). New prices should be reflected on Lyft's site today.
Our tipster isn't the only one fed up. When Lyft's Community Manager, Stacey Speer, brought up the cuts in Lyft's "SoCal Driver Facebook Lounge," drivers were quick to call out the bullshit. Many quit there and then:
And so on.
Lyft tries to sell the pay cuts with the claim that cheaper rates will mean more riders, thus increasing revenue. But the cheaper rates/more revenue myth will never become true, no matter how many times "ride-sharing" startups repeat it.
Uber drivers have no say in the pricing, yet they must carry their own insurance and foot the bill for gas and repairs — a cost of 56¢ per mile, according to IRS estimates. With Uber's new pricing model, drivers are forced to work under razor-thin margins. Arman, for instance, made about $20 an hour just a year ago. And now? Some days he doesn't even break minimum wage.
His experience is quite common among LA Uber drivers I spoke to. For many, driving for Uber has become a nightmare. Arman often works up to seventeen hours a day to bring home what he used to make in an eight-hour shift. When he emailed Uber to complain about his plummeting pay, he said the company blew him off. Uber's attitude is that drivers are free to stop working if they are dissatisfied, but for drivers like Arman who've invested serious money in their cars, quitting isn't an option.
Not that Uber's or Lyft's riders will ever hear this. Drivers told Jacobin that they always tell their passengers how much they love the opportunity, fearing that they'll get low ratings from riders—and then fired by Uber—if they tell the truth.