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The carpool company announced Tuesday that it would open its own repair shops nationwide, offering significant discounts on problems such as punctured tire repairs, brakes and oil changes, as well as as free bank accounts to attract and retain drivers.
The opening of auto service centers and the provision of bank accounts are additional costs for Lyft, which will sacrifice its profit margin so that centers can offer better offers to drivers, according to Chief Operating Officer Jon McNeil. .
Lyft's first repair shop opened Tuesday in San Francisco. It is expected to open more in a number of large cities in the second half of the year. McNeil refused to mention an exact number, citing Lyft's calm period before his IPO. The company had 1.1 million active drivers by the end of 2018.
The new programs are designed to improve driver satisfaction and retention, which would contribute to Lyft's bottom line. In his S-1, Lyft mentioned the need to attract and retain qualified drivers in a cost-effective manner as a risk factor for his business. Lyft currently pays registration fees of several hundred dollars in competitive markets.
"The maintenance of a car is one of the most important costs for drivers," McNeil told CNN Business. "We want to tackle it head-on – helping them save up to 50% on repairs and getting their car back twice as fast will have a significant impact on the driver's net pay."
In San Francisco, a fee of $ 69.99 is charged for oil change, tire rotation and car wash. The labor charges for maintenance are $ 95 at the hour.
All active Lyft drivers will have access to service centers. McNeil said that someday, anybody could have his car repaired by Lyft.
Lyft believes it can make its auto repair centers more efficient than existing repair shops with modern manufacturing techniques. Many repairs do not require vehicles to be in a garage or elevated. Instead, McNeil described an assembly line system that he compared to a stop in the NASCAR stands, made up of technicians employed by Lyft.
"This car can stop, four people can attack these tires, lower them at the same time and have them replaced, which can take half an hour to take less than 10 minutes," said McNeil, who was previously working at Tesla. opened his own repair centers during his tenure.
Earlier in his career, McNeil co-founded a chain of auto repair shops, Sterling Collision Centers.
Lyft's bank account for drivers will come from a partnership with Stride Bank, an Oklahoma bank that changed its name and changed its name to Enid's National Central Bank in February. The account will come with a debit card and a cash back on some purchases, such as gasoline. The driver's earnings will be available immediately. The account will remain open even if a driver stops driving for Lyft. McNeil said Lyft was motivated by drivers who had expressed concerns about high bank charges.
Lyft must also compete with his biggest rival Uber for the drivers. Uber offers its own benefits, including discounts on phone bills and car maintenance costs. Since March 2016, Uber offers a similar account with a debit card, immediate payments and cash back on some purchases.
In addition, Lyft provides a car repair service in which Lyft technicians would travel with their tools to the vehicle requiring service.
"It's like a fist in the gut for us, the drivers who helped build this business, that Lyft has stood in court to block salary increases as they progress." to an IPO with a valuation of $ 23 billion, "said the driver of Lyft. Tina Raveneau, in a statement from the Independent Drivers Guild, a group advocacy carpool drivers.
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