Lyft's New Subscription Plan Seems Like a Legendary Ripoff

Illustration for article titled Lyft's New Subscription Plan Seems Like a Legendary Ripoff
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Lyft just announced the broad availability of its new All-Access Plan. This subscription-based service gets you 30 “FREE” Lyft rides (as long as those rides cost $15 or less) every 30 days for $300. After that, subscribers get a 5 percent discount on all rides. If the math that would make this a good deal seems a little suspect, that’s because it is.


For most people, the All-Access Plan would probably not make sense. You’d have to take 30 rides at $15 a ride within that 30 day window to get the maximum value out of the deal. That would mean you’re getting $450 of Lyft rides for $300. (Tip is not included.) To get any savings, on average, your rides would all have to cost more than $10, and you’d have to use all of them. As for any rides you don’t use, they do not carry over to the next month. If your average ride price falls below $10 in a given month, the All-Access Plan would likely amount to a net loss.

So this Lyft subscription thing seems like a bad deal. Lyft has been testing it in various markets for a while now, presumably to get the pricing structure down right, and it’s still not available for everyone. For the moment you have to get invited by Lyft, so it seems like the company is still targeting certain kinds of riders. The company says it’s going to be open to all “in the US by the end of the week.”

Lyft is marketing the service as a cheaper mode of transportation than owning or leasing a car. And while that might be true for a lot of people, especially when you take gas and parking into account, it’s not hard to see how Lyft’s All-Access pricing structure makes it very easy to spend even more money on Lyfts. After all, if you got rid of your car to take Lyfts everywhere, what other choice do you have?

There are a couple of groups that might like this new subscription service, regardless of whether it’s a good value. One group would be frequent Lyft users who get their rides paid for through work. A single $300 charge is easier to expense than 30 individual rides! There are also the convenience freaks, who don’t care if they use up all the rides or only a few because having it already paid for brings them peace of mind. These are the same types of folks who buy a monthly subway pass and then don’t take the train all that often. But if they need to, at least they have an operational Metrocard in their wallet. Having more money than sense must be fun.

Obviously, you don’t have to buy the All-Access Plan if you (correctly) realize it’s most likely going to be a crappy deal. The sad thing is that drivers don’t have a choice. They’ll still have to treat subscribers the same as regular riders and will get paid the same from All-Access riders as they would from regulars. As with any changes to a ridesharing business, though, it’s unclear how drivers’ pay might be affected in the long run. It does seem like riders with the All-Access Plan might forget to tip more often than others, since it’s not included in their “free” ride. With their monthly payouts already shrinking significantly according to research by the JPMorgan Chase Institute, it’s hard to see why drivers would be excited about this new initiative.

At least Lyft is probably going to make some money off of this. For every subscriber that signs up, doesn’t use their plan, and forgets to cancel, Lyft will rake in $300 for doing pretty much nothing. And maybe that’s the strategy. Just try to rake in as much of that free gig economy money before the industry gets too regulated. Time is running out.



Senior editor at Gizmodo.


O's, Poes and Bohs

As a Lyft driver, I barely get tips as it is. I guess I’m the only person who feels social pressure as a rider to tip a buck even on the shortest rides.