The Gloves Come Off Between Uber and Lyft in Rideshare Fight

Lyft vehicle

Source: http://blog.lyft.com/

What happens when two startups — both of which are disruptive by design — begin to disrupt one another? That’s the story between ridesharing companies Lyft and Uber, both of which have turned the transportation industry on its head. Together, Uber and Lyft have been able to successfully tackle the taxiing industry to a certain degree of success, all the while fighting off lawsuits and regulatory assaults in cities across the country. And as their popularity has grown, so have their respective user bases.

It was only a matter of time before the two decided to butt heads, and it looks like we’re witnessing the beginning stages of it.

The accusations have begun to fly between the two companies, with Lyft drivers reportedly accusing drivers from Uber of trying to sabotage them. In order to fulfill their dastardly plan, The New York Times reports, Uber drivers apparently spent the last ten months requesting and subsequently canceling more than 10,000 ride requests. Lyft drivers say that Uber has done so for no other reason than to irritate its drivers and customers, and the accusations are aimed at 177 individual Uber drivers.

Uber then came back at the accusations with a salvo of its own, releasing a statement not only accusing Lyft drivers of the same type of activity, but also dragging investors and acquisition rumors into the picture.

“Lyft’s claims against Uber are baseless and simply untrue. Furthermore, Lyft’s own drivers and employees, including one of Lyft’s founders, have canceled 12,900 trips on Uber,” an Uber representative announced. “A number of Lyft investors have recently been pushing Uber to acquire Lyft. One of their largest shareholders recently warned that Lyft would ‘go nuclear’ if we do not acquire them. We can only assume that the recent Lyft attacks are part of that strategy.”

Source: Justin Sullivan/Getty Images

Source: Justin Sullivan/Getty Images

In response to Uber’s statement, Lyft levied one of its own, stating that its investors are happy with what they are seeing despite what other may say. “Lyft has more than 100 investors, all of whom are extremely excited that Lyft is approaching I.P.O.-level revenue. Our ‘nuclear’ strategy is continuing to take market share with 30 percent month-over-month growth, while building the strongest community of drivers and passengers,” a Lyft spokesperson said.

Lyft is definitely the smaller dog in the fight, with an estimated value of around $700 million as opposed to Uber’s highly touted $17 billion, according to The New York Times.

As everyone can plainly see, things between the two companies are definitely getting hot. And the accusations aren’t entirely surprising, as there have always been questionable tactics employed by businesses that are in the heat of an intense rivalry. It’s important to remember that there are other rideshare companies out there as well, all fighting for market share in a increasingly-crowded arena. 

In all, things look better for consumers in the end, as a prehistoric taxi cab industry has finally been shaken to its roots and forced to adapt to shifting demand. Before Uber, Lyft, and their counterparts entered the market, people were pretty much stuck hoping for the best the taxi industry had to offer, which usually left a lot to be desired.

But the two companies have successfully done what they had hoped to do, by disrupting the industry and finding valuable revenue streams. Now, after essentially teaming up to take on the industry together, they’re turning on each other.

And that’s not totally unexpected. In fact, it’s the essence of capitalism on full display, when you boil it down. Whether or not this stalls or puts a total halt to any acquisition talks that were going on remains to be seen, but for now, the rideshare and taxi industry — and by proxy the auto industry — remains in a state of flux.

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