Feeling the squeeze from newly revived ride-hailing giants Uber and Lyft, the RideAustin ride-hailing platform has cut its rates.
On Tuesday, June 13, RideAustin announced that it had reduced its fares effective immediately “to match the Silicon Valley Outsiders — all while continuing to offer the MOST competitive driver pay in the market.”
A chart accompanying the announcement indicates RideAustin’s standard fare stands at 99 cents a mile, the same as it was before and 1 penny below the standard rates charged by Uber and Lyft. Standard per-minute rates for all three services are 20 cents; RideAustin previously charged 25 cents a minute.
With some slight adjustments, RideAustin’s per-minute and per-mile fares for SUV, premium, and luxury services now equal those of Uber and Lyft — for instance, $2 a mile and 40 cents a minute for SUV service. The biggest changes for these categories were minimum fares: The lowest premium fare decreased from $10 to $7.15, and the lowest luxury fare decreased from $10 to $8.65.
“Though RideAustin is the lowest operating expense rideshare — honestly — we were the last to lower pricing due to the impact on drivers,” RideAustin CEO Andy Tryba said in a statement announcing the fare cut.
“However, it’s unarguable that extreme price sensitivity in the rideshare market exists and we had to match the new Austin market rates. Fortunately, due to our driver pay model, we will continue to pay drivers significantly more than Uber & Lyft.”
RideAustin’s rate reduction comes amid dramatically lower ridership for the nonprofit service. Last week, RideAustin’s ridership plummeted 62 percent compared with the week before Uber and Lyft came back to Austin, according to a RideAustin post on Facebook.
“We are focusing all of our efforts on our rider marketing to turn this around,” RideAustin says on Facebook.
On May 29, Uber and Lyft resumed offering services in Austin after Texas Gov. Greg Abbott signed legislation that established a set of regulations for ride-hailing operators across Texas. It effectively cancels a City of Austin ordinance that required fingerprint background checks for ride-hailing drivers.
In May 2016, Austin voters rejected a ballot measure backed by Uber and Lyft that would have repealed the fingerprint mandate. After losing at the ballot box, Uber and Lyft pulled out of the Austin market.
The return of Uber and Lyft to Austin has shaken up the ride-hailing landscape in Austin. Ride-hailing service Fare, which had moved its headquarters to Austin, recently exited the local market. Another ride-hailing service, Fasten, still is operating in Austin, as is RideAustin.
RideAustin, which launched on June 16, 2016, has raised more than $250,000 for local charities through its round-up feature. This feature rounds fares up to the nearest dollar and donates the proceeds to several local nonprofits.