Ride-sharing companies are experimenting with subscriptions
The subscription economy is growing alongside the mobile economy. Today, it’s not just about Amazon and Netflix, but also about the next era of transportation. Ride-sharing companies have developed subscriptions for commuters in a bid to secure a monthly stream of income. The question is: Are they working?
A successful subscription-based model can prove to be a lifesaving strategy for companies such as Uber who, according to CEO Dara Khosrowshahi, is targeting profitability in 2021. It’s been more than three years since the ride-hailing company has started cooking up such services for its users. So how do they stack up?
What is Uber’s Ride Pass?
Uber launched the Ride Pass in October 2018 in five U.S. cities: Los Angeles, Miami, Denver, Austin, and Orlando. For $14.99 per month, riders could lock in rates and avoid price surges caused by various factors such as weather or traffic. Six months later, the service became available in other U.S. cities, including New York, San Diego, and Seattle, for $24.99 per month.
The subscription also includes 30 minutes per day of free rides with JUMP e-bikes or scooters, if these are available in the city you live in. The pass is expected to save riders up to 15 percent per ride. While it appears that there is a one-time activation fee, you will be able to track your savings (while using the Ride Pass) in the app so, in the end, you will know if it’s actually worth it. If not, you can always cancel your subscription, which, as expected, renews automatically each month.
Drivers will continue to benefit from all rides, as the company committed to covering the price difference for Ride Pass subscribers. While there are few reviews of the service and not that much feedback on it, it seems that the subscription is actually worth it if you are already using Uber for at least three times a week and, preferably, on the same route.
Does Lyft offer subscriptions?
Yes, it does. In October 2018, at the same time Uber launched Ride Pass, Lyft came up with All Access—a $299 monthly subscription that included 30 rides and some iffy fine print (if a ride exceeded $15, the rider had to pay the difference, but if the ride cost less, then it would still count as a $15 minimum ride). One year later, All Access was replaced with Lyft Pink. This was something that resembled the Uber Ride Pass. For $19.99 per month, Lyft riders would lock in 15 percent savings on all car rides, as well as priority airport pickups and relaxed cancellations. Lyft CEO Logan Green sees the subscription model as the future of the industry, where car ownership becomes optional.
Ride-sharing provider Via offers two subscriptions, similar to Lyft’s. The ViaPass offers several options for commuters in New York, D.C. and Chicago, and the costs and services depend on the location. There are one-week subscriptions for $89 and four-week ones with costs ranging from $169 and $269. NYC users who tested the ViaPass described it as a much better commute option compared to the city’s subway, making the price difference worthwhile.
Via’s $10 SmartPass, offered as a promotional subscription, offers a 20 percent discount for a rider. The discount applies to the rider’s plus one, even though some additional charges apply. Cancellations and no shows are charged $3. The SmartPass is activated during the first promotional ride and each rider will see its expiration date in the app. There are no details on Via’s website on the number of rides included in the pass or the duration of its validity.
What is LimePass?
At the end of 2019, Lime announced its own subscription plan. LimePass subscribers get unlimited free scooter unlocks, instead of paying $1 per unlock. The pass costs $4.99/week, so it works if you use the app daily.
Lime also has one of the most interesting programs in the ride-sharing market—Lime Access—for low-income riders. Currently available for U.S. customers, the program provides a 50 percent or more discount on Lime-S e-scooters and Lime-E electric-assist bikes, as well as more than 95 percent discount for Lime pedal bikes. Eligibility criteria info is available by contacting Lime.
The ride-sharing subscription model works best for riders who use such services often or as an alternative to owning a car. For example, according to an older press release by Lyft, the company’s All-Access Plan costs 59 percent less than owning and using a car for the same routes. Calculations were made using driving costs established through an American Automobile Association report.