The best-known rideshare companies are Uber, founded by Travis Kalanick and Garrett Camp, and Lyft, founded by Logan Green and John Zimmer.
They have established themselves as leaders in the marketplace, developing and spreading throughout the United States and abroad. With the coronavirus restrictions slowly lifting, Uber and Lyft are coming back to the game with limited drivers.
This article will give you answers to why Uber and Lyft might not have enough cars and what can be done to fix the issue. We’ll also give some pointers about how to become a driver and start earning money with these ridesharing services.
Uber and Lyft Are Short on Drivers
Since the pandemic started, Uber drivers’ numbers have decreased by 40 percent in the US. As a result, the prices have gone much higher for passengers who become less willing to pay for their rides. The waiting times became longer, too. Due to the shortage and price surge, people might just switch to traditional taxis if the issue isn’t fixed in time. To make matters worse, it is also fairly common to see a “no cars available” pop-up on the Uber app nowadays.
Thanks to increasing vaccination rates and the reopening of more and more states, people seem to be willing to start traveling again. This means an upcoming surge in demand for new Uber and Lyft drivers.
Why Lyft and Uber Faced a Driver Shortage
Lack of Riders
Ridesharing companies like Uber are losing drivers because many people simply stopped using the apps. According to the San Francisco-based Vice President of Uber, Dennis Cinnelli, in 2020, rideshare drivers stopped working because they weren’t getting enough trips to earn a living.
The situation got flipped on its head just a year later. In 2021, the driver shortage is caused by the sudden increase in rider demand, perpetuated by the lifting of COVID-19 restrictions. This situation is the same for Lyft, as they fight to increase earnings by inviting new and former drivers.
Increasing COVID Case Numbers
Due to increasing coronavirus cases in seasons like winter and autumn, most app users preferred to avoid using ridesharing services when going out. This resulted in Uber having only 95 million active users (16 percent less than the previous year). Lyft has suffered a bigger loss of 45 percent. However, the situation might turn around with the increasing vaccination rates, making the traveling environment a lot safer.
Former drivers were unwilling to jump back to work at Uber and Lyft as they can still claim 300 dollars per week as an unemployment benefit. The problems do not stop here. Uber cannot charge surge pricing because of COVID-19, and it demotivates people to work. Uber allowed drivers to see the passengers’ direction and set their own prices; however, drivers were picky and chose the most profitable rides, and Uber had to remove such an option.
The drivers who couldn’t manage financially switched to a restaurant food delivery service like Uber Eats; however, some restaurants have already used their own driver pool to carry out deliveries. Thus, it forced the drivers to start looking for other opportunities in order to provide for their families.
Banned Surge Pricing During the Pandemic
Small earnings are partly caused by the ban on surge pricing of rideshare companies like Uber and Lyft during the pandemic. Usually, surge pricing happens when many passengers request a ride at the same time frame, increasing the demand for drivers. However, surge pricing could demotivate passengers to request a ride, and lack of it makes them prone to using the services.
Incentives to get Drivers back on the road
Better Offers For Former and New Drivers
Uber and Lyft are offering massive bonuses for drivers to get back on the road. For example, Uber gives a very attractive offer of $1,100 dollars for finishing only 115 trips in Austin, whereas Lyft offers $800 dollars to cover the cost of rented vehicles or for returning drivers. They additionally give cash incentives for trips that last over nine minutes. Uber claims that drivers earn between $26 to $31 dollars per hour working in big cities like San Francisco, Miami, Chicago, etc.
However, it might not be enough to be effective, as most previous drivers do not log into the app to work anymore. Some drivers can use this opportunity to work for a short period of time before quitting again. Uber and Lyft work hard to return their previous drivers and attract new drivers with financial benefits, but some may argue that the promised benefits have been offered too late to make a real difference.
What happened with Uber and Lyft can be reversed if they provide better working conditions permanently, rather than temporarily for gig drivers. A stable, well-paid commission per ride would definitely prevent drivers from leaving them again.
Safety of Drivers and Passengers During Trips
Even though the coronavirus cases are going down and more people are getting vaccinated, drivers are still concerned about their health while driving people around. Being vaccinated and knowing that your rider is less likely to transmit an infection gives Drivers some peace of mind, but many are still quite anxious. It also applies to the passengers who might have safety concerns. To address these questions, Uber started to inform passengers that the drivers wear a mask, and it always reminds them of COVID-related safety rules to follow during a ride.
Nevertheless, the obligations of wearing a mask and sitting in the back seat, and having a shield between people in a vehicle should remain until it is completely safe. If the riders do not comply with those rules, the driver can cancel the ride.
Great Opportunity to Become a Rideshare Driver
Uber and Lyft started incentivizing higher fares and bonuses for former drivers and new ones. While some former drivers are not yet motivated enough to get back to driving, new drivers can seize this opportunity.
People are starting to go out more often, traveling around the city and visiting relatives, and the demand for ridesharing companies has been rapidly increasing. There are more passengers than drivers now, and it became hard to deliver the service to every client. Thus, now is a great time for people who always wanted to try a new profession or a side gig and become a member of a rideshare company. HyreCar can assist you in your first step of getting a car.
Incentives For Gig Drivers
Uber has dedicated investments to attract more drivers. Although stimulus checks could be a temporary bonus for former and new drivers, it is a new opportunity to earn more money than during the pandemic. Since drivers have lots of flexibility, they can work whenever they wish.
Better Earnings For Rideshare Drivers
Prices have increased up to $30 dollars per ride, thanks to the growing number of passengers requesting more rides than before and a shortage of drivers to service the demand. As for new drivers that are just starting working for Uber and Lyft, it seems to be one of the best periods to do so.
How to Start Driving
In order to work as a driver for Uber or Lyft, you need to download the application onto your smartphone and register your account. On the applications, you will need to provide some personal information. There are certain requirements that you need to have if you want to become a rideshare driver. Don’t forget to have your vehicle checked, and make sure to purchase insurance that your state will recognize. Once everything is confirmed, you will receive stickers that should be visible on your vehicle or easily rent one from HyreCar.
The rules to be a driver are not hard to comply with:
- Your vehicle should have 4 doors with places for a minimum of 4 passengers (it can be a private or rented vehicle),
- You must have at least a year of licensed driving experience (or 3 years if you are under 23),
- You must have no criminal record,
- You must have a clean driving license record,
- You must undergo a background check.
Similarly to other rideshare services, Lyft requirements for a driver are as follows:
- Your car must have 4 doors with a minimum of 5 passenger seats (can be private or rented),
- You must have at least a year of licensed driving experience (or 3 if you are under 23),
- You must have no criminal record,
- You mustn’t have more than 1 major or 3 minor violations in the past 3 years,
- You must undergo a background check.
Since the beginning of rideshare services, various states have had to implement demand towards the drivers to ensure a safe environment for passengers. Before you sign up with any company, it is recommended to check the special rules set out by your state. If you do not comply with them, you cannot work for any rideshare services.
Rideshare companies have lost many drivers during the pandemic restrictions when states were closed. However, with the increased number of vaccinated people, companies hope to increase revenue and deliver stable and affordable services. Since Uber and Lyft made some serious mistakes during the lockdown, they unwillingly discouraged drivers from working for them. The companies now work hard to win the drivers back and offer cash incentives, bonuses, and higher wages, which has put all of the prospective drivers in a very advantageous position.