Ride Austin struggles to compete as Uber/Lyft return
On Memorial Day, Governor Greg Abbott signed HB 100 into law -- a piece of legislation that regulates ride-hailing statewide. It basically undoes local rules that the two companies argued were overly burdensome for their business models, like fingerprint background checks. Uber and Lyft left Austin over that issue.
But before noon on Monday, Uber and Lyft were back on Austin streets after being gone for over a year.
“Every company will be able to compete in an open market place,” said Governor Abbott.
CBS Austin compared two of Austin’s top ride hailing companies: Uber and Ride Austin. CEO of Ride Austin, Andy Tryba said his company was the number one TNC in the market before the two Silicon Valley giants returned.
Around 3:15 p.m., we took an Uber from our North Austin office on Metric Boulevard down to the Governor’s Mansion next to the capitol, a 10 mile ride. The driver said after Uber left in May last summer, he drove for Fare but stopped after three months because he wasn’t making enough money. He said with Uber, he could easily make $100 a day but with Fare he would average about $75 a day.
“I like Uber because everything runs the way it’s supposed to run,” said the Uber driver who didn’t want his name disclosed.
Once we arrived at the Governor’s Mansion, the 28-minute Uber ride cost $12.78.
Next we requested a ride back to the office with Ride Austin. A short three-minute wait later and Daryl pulled up curb side to take us back.
“I think enough people were pissed at Uber and Lyft to keep (Ride Austin) going I hope,” said Daryl.
As an Austin local for the past 20 years, Daryl said he’ll likely drive for Lyft if anything were to happen to Ride Austin.
Shortly after HB 100 passed out of the House and Senate, Andy Tryba said Ride Austin would shut down if see ridership hits below 20,000 rides a week.
Ride Austin COO Marisa Goldenberg estimated ridership was in the “low 30,000” as of Wednesday, since the return of Uber and Lyft. However, she said experienced drivers know the next five weeks of the summer are traditionally slow for ride-hailing companies.
The trip with Ride Austin took 27-minutes and cost $21.00 even.
Goldenberg said starting early next week, Ride Austin plans to announce a crowdfunding campaign on Indiegogo for $1 million. The local non-profit is looking to “play to their strengths” and make drivers employees and offering them benefits, vacation time, and a “competitive” salary.
For now, Ride Austin has no plans to undercut or lower any prices. Goldenberg said they “can’t beat (Uber and Lyft) at their own game.”
NOTE: Uber is running a $5 off promo for returning Austin riders. The promo runs until the end of the weekend. It's unclear if the promo was applied during the ride CBS Austin took.