Uber and Lyft are finally starting to look like different companies

Uber and Lyft have been operating on parallel tracks for a long time. Drivers show off both services, customers switch between the two apps, and despite Lyft’s efforts to position itself as an “awakened” alternative to Uber, the two companies operate essentially identical ride-sharing services in the US.

Of course, there is a lot to distinguish the two from one another. Uber is global while Lyft only operates in North America. Uber dominates ride-sharing, taking up about 70 percent of U.S. riders and leaving Lyft with the rest. But this week’s earnings reports revealed a much sharper divergence between the two companies than we’ve seen in the past, namely around crowds.

The most important perk of Uber is delivery. Food and other delivery bookings in the fourth quarter were up 33 percent year on year. The company’s CEO, Dara Khosrowshahi, told investors that Uber’s delivery business reported its first quarter profit, including US delivery, and that “Uber Eats became the fastest-growing delivery company in America.”

Lyft, meanwhile, has a small business-to-business delivery operation, but has no plans to tackle the much larger and riskier world of consumer delivery. “As we’ve said for many years, we’re a transportation-focused company,” Lyft president John Zimmer said in his company’s earnings call. “We want to have one main consumer that we build for. And again, we will not build a consumer-oriented marketplace for groceries or food.”

However, what Lyft has that Uber doesn’t is a thriving micromobility business. Lyft claims to be the largest electric bike operator in North America thanks to its bike sharing business, which includes the extremely popular Citi Bike in New York City. How popular do we have it? According to Zimmer, Citi Bike was the “25th most traveled transportation network in the United States”.

“To put this into context, last year more people rode Citi Bikes than BART, the Bay Area’s regional transportation system,” he added.

In fact, bike sharing is a faster growing business for Lyft than ride sharing. “Consider that in each quarter of 2021, the number of riders using our bikes and scooters in addition to ride-sharing consistently grew faster than riders who only share rides,” said Zimmer.

Uber has largely given up on its two-wheel business, selling its Jump bikes to Lime, and also ditching its electric scooter business. Uber remains an investor in Lime and customers can rent Lime’s e-bikes and mopeds through the Uber app. But by all means, Uber is out of the micro-mobility game.

Another key difference between the companies is their approach to autonomous vehicles. Uber and Lyft were both initially optimistic about AVs, acquiring startups, hiring thousands of engineers and making big promises about robotaxis on their platforms. But as costs rose and timelines rose, both companies finally decided to cut their losses. Uber sold its AV business to Aurora in 2020, while Lyft sold its self-driving unit last year to Woven Planet, a subsidiary of Toyota.

But Lyft still sees an opportunity to stay close to the AV world. The company struck a deal with Ford-backed Argo.ai to place hundreds of the company’s autonomous vehicles on its platform. Zimmer said he expects the partnership to scale to 1,000 vehicles in multiple markets by 2026.

“The Lyft network is a continuously improving product, born of a decade of engineering investment in billions of real-world journeys,” he added. “As a result, AV providers are increasingly working with us to advance and commercialize their technology.”

There were zero mentions of AVs in Uber’s earnings call — which shouldn’t come as a total shock. One of the company’s self-driving test vehicles hit and killed a pedestrian in Tempe, Arizona, in 2017 in what many are calling the first AV fatality accident. Federal investigators said safety issues at Uber were partly to blame for the death. The company stayed with its AV project for several years after the incident before finally deciding to divest itself completely.

It’s not wrong to see Uber and Lyft as two sides of the same coin. Both companies still derive the majority of their revenue from car trips. Both are heavily invested in subscription services as a way to build customer loyalty and avoid app switching. And both are still embroiled in tense debates about the work and classification of drivers.

But this most recent quarter revealed that the futures of both companies may be different than originally anticipated.

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