Last week, Lyft announced that it had raised a massive $250 million round of funding as part of its effort to compete against other on-demand ride services. Now the company is going on the offensive against its competitors, with a price cut of up to 20 percent in all of its markets.
Lyft’s Spring Pricing initiative, which it is announcing to drivers in an email blast today, will lower the cost of rides for all consumers who use the service. But it won’t affect the amount of money that drivers take home — instead, the company is temporarily suspending its 20 percent commission while testing out the new rates.
With the cuts, Lyft is making a big push to acquire users in a market that is being increasingly driven by the cost of getting from Point A to Point B. In January, Uber announced a similar fare reduction in 16 of its U.S. markets, which it claimed would make it the lowest cost provider for its users.
Just last month, Lyft introduced its “Happy Hour” pricing, which lowers rates in periods of low demand. The company has also been giving out free rides to users in newly launched cities as part of its “pioneers” program.
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