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In its 2024 announcement, the ride-sharing company Lyft revealed that a new policy guarantees drivers will receive at least 70% of the fare paid by riders each week, after deducting external costs such as local taxes and mandatory insurance.
Last year, drivers typically earned 88% of the fare, but about 15% earned less than 70% after fees, according to the company. Almost 65% of drivers experienced this at least once.
If drivers’ earnings fall below 70% at week’s end, the company will compensate the shortfall.
Since becoming CEO in April 2023, David Risher has aimed to restructure the company to better serve riders and drivers, reduce losses, and compete with its larger rival Uber in the U.S. market.
Risher’s strategy includes increasing driver pay and making earnings more transparent.
Key features of the Early 2024 Release for drivers include:
Earn 70% or more of rider fares after external fees each week, guaranteed
See where riders’ fares go
Earn more for waiting during scheduled rides
Find more ways to choose rides at the airport
Access new earning and navigation opportunities for EVs
Appeal deactivations easily in the Lyft app
In June 2023, the company improved its upfront pay feature, which was introduced in October 2022, allowing drivers to see potential earnings before accepting a ride. This led to competitive market earnings, with average earnings per ride increasing by 10% and long ride earnings by 14%.
The company also revamped its earnings summary in the app, showing the distribution of payments between the company, drivers, and external fees.
Comparatively, Uber’s public policy team stated in December that a large portion of rider fares went to drivers in the third quarter of fiscal 2023, with gross bookings increasing by 21% to $35.3 billion.
Lyft’s updates, including enhanced airport ride selection and an easier deactivation appeal process, arrive as Americans struggle with high-interest rates, inflation, and rising credit card debt.
