Uber, Lyft, and Bicycles

Uber and Lyft Aren’t Just Competing for Rideshares: Bicycles are Now in the Mix

If it works on four wheels, it should work with two, right?

Uber and Lyft are no longer competing to give you only a car ride. Now, they’re both entering the bicycle-sharing business.

Lyft recently announced that it has acquired New York City-based Motivate, the parent company of several bike sharing programs, including Citi Bike in New York, Divvy in Chicago, and Ford GoBikes in San Francisco. Lyft says that 80% of bike share trips in the US were on Motivate bikes in 2017.

With its $250 million acquisition, Lyft will launch a new business called Lyft Bikes, which will incorporate Motivate’s technology, corporate functions, and city contracts. Lyft said it will continue developing bike sharing systems in major metropolitan areas in North America and will work to expand the systems already in operation by Motivate.

The company says that the acquisition demonstrates its commitment to a more sustainable world as part of its Green Cities Initiative, and comes on the heels of the company’s recent carbon neutrality pledge.

However, this is undoubtedly in response to Uber’s $200 million purchase of Jump last spring. Jump now operates in 40 cities and has negotiated agreements with the peer-to-peer car sharing startup Getaround and with Masabi, a company that provides mobile ticketing for public transit. Uber’s CEO says it’s part of the plan to make the company your “go-to” transportation service.

Bicycle Competition between Uber & Lyft

Ride-hailing or ridesharing companies like Uber and Lyft have concerns that bike-sharing will take a bite out of their business by giving consumers less-expensive, traffic-free alternatives for making short trips through metro areas. Rather than competing with these bike-sharing companies, both Uber and Lyft have made strategic acquisitions in this market.

And strategic is the key term with Lyft’s purchase because Motivate has more than bikes. Again, the company has contracts with cities, along with longstanding relationships with city officials. These elements may give Lyft the advantage to dominate the industry across metro areas, regardless of a consumer’s mode of transportation.

What’s Next for Uber, Lyft, and Bicycles?

E-scooters may be the next mode of transportation up for grabs. Uber has applied for one of the five permits that San Francisco will issue. That city is the mecca of the e-scooter craze. However, company officials won’t say if Uber will develop its own scooters or again plans to acquire another established business to enter the market.

In addition to electric scooters, the future of ride-sharing may soon include even public transit as Uber and Lyft gallop towards “new modalities”—in essence, the two rideshare giants want a part of every method that a consumer can get from one place to another. Neither company minds how a consumer travels around the city—provided he or she is doing it on their platform.

Lyft operates in roughly the same number of U.S. cities as Uber, as well as in Toronto, Canada. Uber operates across the globe; however, they’ve pulled back from Southeast AsiaRussia, and China after suffering losses of billions of dollars trying to compete with local rivals.

Bicycle Accident Insurance

One important question with these bike-sharing programs is liability. If a consumer is injured in an accident while using a ride-share bike, who is liable?

The bike-sharing market is still in its early stages, and services may operate in a legal gray area. It’s important to note that roughly half of the states classify e-bikes as motor vehicles, requiring licensing, registration and insurance.

For example, in China, regulations require that bike-sharing companies either insure the bike or the transaction.

Perhaps Uber and Lyft’s bike-sharing programs will follow the route of the insurance program designed for ridesharing. Chubb Insurance Company is underwriting policies provided by a startup called Sure that will provide coverage for rideshare riders. The insurance will be available on an on-demand, daily basis through a smartphone app.

After a Bicycle Injury

Whether you’re injured by a motor vehicle while riding your own bike or one you’re using from a bike-sharing service like Jump or Lyft Bikes, you have options. You can contact us for a free consultation. If you are a member of the Atlanta Bicycle Coalition, you may be eligible for an additional discount.