Lyft’s co-founder thinks riders will pay for rides by monthly subscription in the future

By Aarthi Rayapura October 26, 2016

Lyft co-founder John Zimmer spoke on autonomous cars, the future of car ownership, and the company’s plans in a recent interview with Bloomberg TV.

Below are some of the highlights:

  • Lyft’s partnership with GM revolves around shared vehicle access and the transition to autonomy. Zimmer noted that Lyft drivers can currently lease vehicles from the company, and that they could expand this in order to allow non-Lyft drivers to lease cars from the company. Zimmer also reiterated that in five years the majority of Lyft rides in major US cities will be conducted by autonomous cars.
  • In the future, consumers will pay for transportation services via monthly subscription. Zimmer compared it to Netflix or Spotify, where users pay a set fee for access to unlimited content over a given time period. Lyft could work the same way, where users pay a flat fee for a month of unlimited ride-hailing. Zimmer even suggested that Lyft could potentially offer multiple plans, such as for businesses or families. In July, Uber, Lyft’s main competitor, released a payment plan that gave unlimited UberPOOL rides for $200 a month.
  • Zimmer also argued that Tesla CEO Elon Musk’s plan for private ownership powering ride-hailing will not allow for a universal mobility experience. Musk’s plan, announced in July, is for private ownership of vehicles that would be part of a fleet which could be autonomously summoned via an app. Zimmer pointed out that he felt this would not be a workable model, as it would not guarantee that users experienced a consistent ride experience, as each consumer modifies the interior of their vehicle differently.

Overall, Lyft is positioning itself well if car ownership drops and consumers opt to use ride-hailing services for mobility. Zimmer emphasized that while GM thinks car ownership in rural settings could stay steady or increase in the coming years, they see car ownership in urban settings decreasing in the next few years as ride-sharing becomes far less expensive with the advent of autonomy.

Since the start of 2016, automakers, tech companies, and ride-hailing services have been racing to create a driverless taxi service. This service would mirror how an Uber works today, but there wouldn’t be a driver.

So far, the race has been brutal, as companies jockey for position by spending billions to acquire/invest in companies that will help make a driverless taxi service a reality. Uber recently took the pole position by announcing it would begin piloting its self-driving taxi service (with a driver still behind the wheel) in Pittsburgh later this month. But other companies, including almost every automaker, are quickly catching up as we reach the mid-way point in the driverless taxi race.

Read the full article on Business Insider

And check out Zuora CEO Tien Tzuo’s article – Detroit Schools Silicon Valley on the Future of Transportation