The outbreak of the coronavirus brought Ride-hailing to its knees, and that was back in 2020. LYFT Inc (NASDAQ:LYFT) and Uber Technologies Inc (NYSE:UBER) reported losses, but things seem to be taking a different turn lately. The companies attribute the impressive changes to the government’s vaccination programs in the previous month.
Return to normalcy
The return to normalcy sparked changes, with most people going back to their usual undertakings. Lyft was impressed by its performance in the week ended March 29 after witnessing an 80% increase in profits. The increase was in relation to what it got in the first week of the year. Uber experienced a 76% climb over the same period.
Lyft President John Zimmer has outlined the vaccination’s impact on demand. Zimmer says that an increase in the vaccination rate has constantly resulted in a rapid rise in demand.
The vaccination seems to act as a reverse to the pandemic, considering the positive impact.
Riders seem rather enthusiastic about hitting the road, but things aren’t the same for drivers. The two leading companies have woken up to the realization that drivers are less passionate about their work and have decided to offer incentives.
Why the driver’s reluctance?
Many reasons continue popping up as explanations for the phenomenon. Safety concerns top the list, with many drivers fearing for their general wellbeing. The other thing has been the lack of a steady workflow. Most of the drivers seem more enthusiastic about food deliveries and tasks in different segments. Analysts continue to speculate on whether or not the availability of vaccines will bring them back.
The drivers’ reluctance continues to spark longer wait times, which isn’t great for the ride-hailing industry. Analysts fear that the phenomenon might negatively impact ride-hailing appeal to consumers.
Matters have always been relatively easy for consumers in the past, considering their guarantee of instant gratification.
The leader of driver operations for Uber in Canada and the U.S, Carrol Chang, confirms that riders have been moving in at a faster rate than the drivers. Both Uber and Lyft have been making moves to motivate drivers. One of the ways has been to spend millions on driver bonuses. They hope to succeed in their quest to end driver shortages.