After waging a nefarious and ultimately successful campaign to avoid paying gig workers in California a living wage at all costs, Uber Technologies Inc and Lyft Inc have been rewarded with an $810 million government contract.
Under the five-year agreement, issued by the General Services Administration on Monday, the ride-hailing companies will be tasked with providing transportation for up to 4 million federal employees and their families.
“The expansion of our customer base to include government is a natural next step for us, and we’re proud to help federal agencies tackle some of the biggest administrative challenges they face,” Ronnie Gurion, global head of Uber for Business, said in a statement.
While federal employees have often used private ride-hailing services to travel in the past, the new contract formalizes that relationship, allowing Uber and Lyft to promote their services directly within government departments.
The contract was first tentatively announced in April, when Charlotte Phelan, the Federal Acquisition Service assistant commissioner for travel, transportation and logistics, wrote in a blog post that Uber and Lyft had been open to waiving certain additional fees, and that the agency had also been able to negotiate considerable discounts with the ride-hailing companies comparable to what large commercial customers would typically receive.
“GSA’s new governmentwide Rideshare/Ride-hail BPAs modernizes official travel and will make it easier, and cheaper, to use rideshare services for official travel,” Phelan wrote. “No new apps to download - and no paper receipts to lose.”
Veronica Juarez, Lyft’s vice president of social enterprise and government, told Reuters that the deal was the culmination of a nearly four year-long negotiation process. While she declined to say how much the company expected to rake in as a result of the contract, Juarez noted that U.S. government spending on ground transportation tops out at around $200 million each year.