It has been months since Lyft and Uber filed for IPO, and now one of the two titans in the ride-hailing industry is now finally on the market. Just last Friday, Lyft has started with the course of trading to ordinary investors. As expected, stocks soared up to 20% and stabilized up to 9%.
Now that is all well and good for the company, having more resources to plan out their future. The issue that needs to be addressed now is that will Lyft be able to stand the test of time to reach its ultimate goal, and an ambitious one at that.
Truth be told, having a driverless vehicle on the road that would serve as a customer’s “ride” is pretty ambitious. To add, it is said that the deployment of an advanced technology of such would take more than a couple of years to develop. What’s more, that’s just an assumption from experts. Who knows, it could go as long as a decade or two.
As stated by the company, they plan on providing these self-driving vehicles in 5 years or so. In 10 years, the company is reaching for a goal where the majority of its trips is run by autonomous vehicles. Uber apparently have the same sentiments with Lyft and even claims to have the means for such technology.
Reason Why Lyft and Uber Filed for IPO
Going public is a massive decision for both of these companies. There are numerous benefits, but it also comes with a heavy price. So why did they do it?
Currently, both companies are operational because of the sheer number of employed drivers. We’re not talking thousands here, but millions. These drivers are of course entitled to their wages, and you could only imagine how much would that be costing these two companies.
Going public is likely not just a choice, but more on survivability. As experts have stated, this kind of business can only survive so long, especially with the advancement of artificial intelligence. Since drivers also have concerns of their own, they are fighting for a few benefits and a fair amount of wage. In fact, there’s a proposed bill that would significantly increase the wages of the drivers. This would also include benefits such as basic labor protection.
“Lyft and Uber together will be able to pull this off for several quarters but they are going to have to show profitability and they’re not close,”Professor Brent Goldfarb, University of Maryland
Take it with a grain of salt, but Lyft cautioned publicly that there’s a chance that the company may never achieve what Amazon and Google has achieved, profitability.
The Road to Silicon Valley
If you are not that familiar with Silicon Valley, it is a place just south of San Francisco bay Area, where innovation and advanced technology are focused on. Not all the companies that goes there were successful in their venture, but a few of the juggernauts today did. To name a few; Amazon and Google.
Lyft and Uber, alongside some well-known vehicle transport companies joined partnerships for driverless programs in Silicon Valley. There are no definitive results as of yet, but there has been an instance where a self-driving Uber was involved in a pedestrian crash in Arizona. It was a huge disappointment and a setback for the company that it took over nine months for them to start testing their driverless vehicles again.
The Future for Lyft and Uber Drivers
As if low wages and disagreeable benefits weren’t enough, drivers have to face the pressure of being replaced by artificial intelligence. Aside from those mentioned, the continuous rise of drivers flooding the ride-hail transport system makes it difficult for them to earn their usual wages.
The good news is that there is no certainty to what the future holds. It all depends on when the A.I. on driverless vehicles are fully operational. Seeing that there are still major issues concerning the said technology and road mapping, drivers still have work waiting for years to come.