Uber, Lyft earn even more market share on taxis and rentals

The battle of the ugly market share in ground transportation reimbursed.

Carpool companies are shaking the car rental industry and the taxi industry in the United States. In at least one segment that we can follow – the ground transportation reimbursed by the company – the rental car and taxi industries are crushed.

Faced with these carpool startups are, after decades of consolidation, three car rental companies that now control 95% of the US car rental market by $ 28.6 billion a year, each with a number national brands.

• Hertz Global Holdings (HTZ) which owns Hertz, Thrifty and Dollar Rent A Car
• Avis Avis Group (CAR) which owns Avis, Budget, Payless Car Rental, and Zipcar
• Enterprise Holdings (privately owned) which owns Enterprise, National Car Rental, Alamo and Enterprise CarShare.

The total fleet of rental cars in the United States (all operators, including independents) decreased by 5% year-over-year to 2.19 million vehicles in 2017, as design fleets became great theme. According to Auto Rental News estimates, total revenues in 2017 were essentially stable compared to 2016.

Although there are segments of the car rental sector that are doing well, it is There is a segment where carpooling companies share their meals: transportation.

And the carpool companies totally erase the taxis' market share in the reimbursed ground transportation segment.

These trends appear in data from Certify, a provider of online travel and expense management for businesses, based on its analysis of more than 10 million revenue and business travel expenses.

Of the three ground transportation segments for reimbursement of business expenses – car pooling, rental cars and taxis – the share of Uber and Lyft combined reached 72.5% in the second quarter, according to Certify. It's up 0% it's not so long ago!

In the first quarter of 2014, when Certify began tracking carpool refunds, their combined share was 8% (almost all Uber).

At the same time, the share of rental cars reimbursed for ground transportation dropped from 55% in the first quarter of 2014 to just 22% in the second quarter of 2018. The share of taxis went from 37% to only 5%:

Carpool companies have a huge competitive advantage: they lose a lot of money, and their investors like that and reward them – or rather themselves – with lavish valuations. . In fact, investors are impatient to give them more billions to burn, and so they subsidize each trip eagerly.

Carpool companies also have the advantage, in many jurisdictions, of not being regulated as taxi companies, and thus avoiding certain expenses and certain rules.

But most importantly, carpooling companies offer a service that passengers enjoy and appreciate. This happened when the taxi industry slept through the arrival of smartphones – and what an application-based system could do. While there are now applications for taxi services, it's too little too late.

In terms of competition with rental cars in the land transport segment reimbursed: it makes sense. When you get off a plane in a city you do not know, nothing beats the car rental counter and the transport by drivers who are at your disposal day and night for the five days of your stay. And the company willingly pays for it all. This is a no-brainer for many business travelers – see the table above.

But in the land transportation universe reimbursed, it is a fierce battle for market share between Uber and Lyft. Uber was the first and had the small pieces that he cut out rental cars and taxis to himself at the beginning. Then Lyft arrived and gradually began to eat in Uber's market share. But both were taking their share of taxis and rental cars at an astonishing rate, and Uber's loss of market share to Lyft was not a big deal.

At the end of 2016, Uber's series of self-inflicted fiascos caused a sudden shift in traffic to Lyft, with Lyft increasing its market share from 7.7% in the fourth quarter of 2016 to 21.1% in the second quarter. quarter 2018. Over the same period, Uber's share dropped from 92.3% to 78.9%:

While Uber loses shares in Lyft in the carpool segment, business travelers spend more money per trip with Uber than they do. with Lyft, according to Certify. In Q2 2018, on average one way:

• Uber: $ 26.00
• Lyft: $ 22.37.

In many industries, newcomers with a more attractive product or service can gain a good share of the market, until the incumbents pick it up and fight back successfully, halting their own losses of market share. This does not seem to be the case in the repurchased ground transportation segment where Uber and Lyft continue to crush the car rental and taxi industries that have not yet experienced visible backflow.