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Lyft vs. Uber: Which Is the Better Ride-Hailing App?

Lyft vs. Uber: Which Is the Better Ride-Hailing App?

Last updated: March 23, 2020
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When looking at the two great ride-hailing apps dominating the market right now — Uber and Lyft — it can be hard to differentiate. The two are so competitive that they’re constantly working to outdo the other when it comes to features, pricing, and more. That competition has resulted in two apps that are very similar.

In this article, we’re diving deep into the Uber vs. Lyft debate to evaluate the ridesharing services from top to bottom. We’ll compare everything from pricing, ride types, and apps to driver earnings, scooters, and more. By the end, you should have a very clear idea of the similarities and differences between Uber and Lyft so you can decide which one you want to use.

Lyft vs. Uber Competition

Lyft and Uber are the two biggest players when it comes to on-demand ride-hailing, and their competition has become the Coke vs. Pepsi (or McDonald’s vs. Burger King) of the Silicon Valley boom.

Both companies were born out of San Francisco, and both remain headquartered there. A fun fact not a lot of people know: Lyft is actually an older company than Uber — it was founded in 2007 as Zimrides, a carpooling service aimed at college students.

Uber came around in 2009, and was initially more of a limousine company that allowed people to book high-end black cars via smartphones. Eventually both companies arrived at the same ridesharing space and they’ve been competing hard for a bigger market share ever since.

This competition is seen in just about everything these companies do, both in their marketing, pricing, and the services they offer. As the companies move into delivery service, scooter rides, and even self-driving cars, both are constantly looking for ways to outshine the other.

Pricing

Lyft and Uber offer competitive pricing — it’s so competitive that it’s often hard to see the difference between the two of them.

Both services run about the same when it comes to pricing. In some cities, Lyft might have a small edge; in other cities, Uber might. Lyft might be cheaper at certain times, particularly if Uber prices are surging. But on average, the costs are almost exactly the same per ride.

The reason for this is competition. Neither Lyft or Uber want to give up market share to the other, and if one began offering much cheaper rides than the other, they could lose money. The pricing is competitive and, at most times, about the same.

Lyft calculates their cost via six factors: Initial cost, service fee, fee per mile, fee per minute, minimum fare, and tip. Initial cost is their base price for a ride, which varies by city and ride type. Their service fee is a flat 90-cent surcharge, no matter the ride. Fee per mile is how much you are charged for distance, and it varies by city. Fee per minute adds a small charge for the minutes expected for a trip to take.

The minimum fare is the lowest amount a trip can cost in a certain area, and it’s meant to protect drivers from making little to no money on very short trips. For example, if you’re riding two blocks in a rainstorm, the initial cost, service fee, and fees per minute and mile might only add up to two or three dollars. As such, Lyft might set a minimum fare of $5 to justify the driver taking the trip.

Uber calculates cost using a similar formula, though they label things a little differently. Uber rides are calculated via base fare, time, distance, Safe Ride Fee, minimum fare, and tip. Sound familiar? It’s all the same model. Uber’s Safe Ride Fee is one dollar to Lyft’s 90-cent service fee, and some cities have different base fares depending on which app you use. That said, it’s all going to be extremely close when it comes to average cost per ride.

Surge Pricing

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Surge pricing is how Uber and Lyft deal with peak hours, when the demand for rides outweighs the supply of cars on the road. To deal with that, they multiply the cost, sometimes by two, three, or even four times the original cost, to entice drivers out on the road and limit the number of customers using the app.

Surge pricing tends to occur during prime times when there is high demand — rush hour, during a rainstorm, after a major concert or sporting event — and can vastly jump the cost for either of these rides. Surge pricing can vary by Lyft or Uber, either the amount a price is multiplied or if it’s even enacted, depending on which is more popular in an area and how many drivers are on the road.

Because of this, many riders have both Uber and Lyft apps. It can help you search for a slightly better deal when you need a ride when surge pricing is in effect.

Websites to Help You Estimate Cost

If you’re curious about the price of an Uber or Lyft ride to a destination, these websites can do the work for you by estimating the cost of a ride on both services, no matter where you are.

RideGuru

RideGuru is a powerful site that lets you not only compare Uber and Lyft prices, but it lets you see what a taxicab will cost for a given trip, as well as any other rideshare competitors in an area.

Simply enter your starting destination and ending destination, and you’ll get a full report with all the information you need to make the most economical choice when it comes to booking. On top of that, they let you simulate surge pricing to estimate what the cost will be during periods of high demand.

EstimateFares

EstimateFares is a site that lets you estimate the price of rides with Lyft or Uber by entering a starting address and a destination. The site then runs an average of what that ride generally costs using the Uber and Lyft algorithms.

A nice feature of the site is that it allows you to review the general pricing for these services in different cities, as it has compiled average fares to create “city guides.” If you’re moving or traveling to a different city for work, you can quickly review the pricing for the services in your new town or see if Lyft or Uber is more affordable in your city.

Ride Types

When you want a ride via Lyft or Uber and you’re going to book with your smartphone, you’ll notice that there are different kinds of rides you can select. While each app’s ride types are more or less similar, they’re labeled differently.

Lyft offers:

  • Standard Lyft
  • Lyft XL
  • Lyft Lux
  • Lyft Black
  • Lyft Black XL
  • Lyft Line

Uber offers:

  • UberX
  • UberXL
  • UberSelect
  • Uber Black
  • UberSUV
  • UberPool

These ride types are consistent for Lyft and Uber. Lyft and UberX are your standard rides in a driver’s car, whatever that car may be. Lyft XL and UberXL are standard rides that can fit six people. Lyft Lux and Uber Select are standard drivers with luxury cars. Lyft Black and Uber Black, as well as their larger counterparts — Lyft Black XL and UberSUV — are high-end black car services provided by professional drivers.

Lyft Line and UberPool are the two companies’ carpool offerings, which let you split the cost of the ride by sharing it with other people.

The Apps: Lyft vs. Uber

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The Uber app and the Lyft app both function in very similar ways. They’re both available on Android and Apple devices, and both allow you to securely book rides, follow along with your car’s progress in real time, leave a tip for your driver, and pay securely using saved credit cards.

Both let you set up multiple profiles as well, so you can charge some rides to a business account and others to a personal account.

It really comes down to feel and preference. If you prefer the look of one app, go for it. But when it comes to functionality, they’re almost identical in what they offer.

If you’re in the United States, you can reach out to customer service representatives via the respective apps.

Driver Earnings

People looking to pick up a side gig as Lyft drivers or Uber drivers all want to know: Which is the better company to work for?

Both companies have similar requirements: They want you to have your own car, have a safe driving record, and be able to pass a background check to become a rideshare driver. If you have a luxury car, you’ll have the option to provide a higher end ride service that could earn you more as well.

As for which company pays better, that’s an open debate. According to an in-depth article from Ridester, Lyft tends to take a smaller cut per ride for drivers, while Uber often has more enticing sign-up bonuses to get new drivers in their fleet. In the end, it ends up being about the same. To gain more earning potential, some drivers work for both apps simultaneously.

More Services

Lyft and Uber aren’t limiting themselves to on-demand ride-hailing apps ⁠— both are expanding into new fields.

Uber has jumped out ahead of Lyft in one area — food delivery. Uber offers Uber Eats, a competitor to Postmates and Seamless, which offers food delivered to your home by Uber drivers. Read more about Uber Eats service.

In Los Angeles, New York City, and other major cities, Uber and Lyft have begun offering scooter service, which lets people rent electric scooters to get around town. Both companies are also looking into electric bike services and more. If there’s a way to get around, Uber and Lyft will look into it.

Your Choice: Uber vs. Lyft

When it comes to choosing a rideshare service, it’s often hard to tell the difference between Lyft and Uber. They’re so competitive that if one app introduces a new feature, it won’t be long for the other to catch up and implement that same feature as well. Pricing is comparable, as is driver pay, and the apps work much the same way. When it comes to the Lyft vs. Uber debate, it really comes down to personal preference.

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