Need a ride in St. Paul? Instead of a hailing a cab, you can call a magenta-mustachioed car with a driver who will fist-bump you and have you sit up front for conversation purposes.
Lyft, a San Francisco-based car service relying on citizen-owned vehicles, instead of a traditional taxi or limo fleet, begins operations in St. Paul this week, with the rest of the Twin Cities area expected to follow eventually. Riders summon the cars via their smartphones.
Lyft is not without controversy. The company is not licensed to operate the way taxi companies are — which has irked business rivals and led to legal action in some cities. Lyft argues it does not need such permits and doesn’t apply for them.
Instead, Lyft has put in place a system of driver-background checks, vehicle inspections, insurance coverage and driver monitoring — the latter largely via ratings that customers punch into the smartphone app after their rides.
This makes the service safer and and more reliable than traditional taxi companies, co-founder John Zimmer said.
It is “100-percent legal,” he added.
Yet the city of St. Paul isn’t exactly rolling out the welcome mat.
“I’d be very concerned if there is no licensing,” city council member Dave Thune said Thursday.
“When we license taxis, we are entrusting our citizens’ lives with the drivers. We want to make sure they have good driving records, that their cars are safe.”
Lyft customers request rides using an Android or iPhone app, which is becoming a public transport trend in the Twin Cities and elsewhere. San Francisco-based car service Uber, which bills itself as a luxury option, also has an app-based service in the Twin Cities. Twin Cities taxi companies have followed suit with their own apps, including iHail and Taxi Magic.
Lyft is unique in how it eschews professional drivers for citizens from all walks of life who work flexible hours and use their own cars to make a bit of extra cash. Their cars can be recognized by the big, furry pink mustaches hanging above their bumpers.
Lyft says rates are about 20 percent cheaper than a typical cab fare. Lyft makes its money by taking 20 percent of each fare; the rest goes to the drivers, who pay for their own gas.
City officials say, at first blush, no ordinance prevents Lyft from offering its ride-sharing services. But they said they plan to monitor the program.
The St. Paul Department of Safety and Inspections has been studying how Lyft operates in other cities, and the city council hasn’t ruled out amending its ordinances to better regulate Lyft and other app-based hail-a-ride services.
“I realize it’s a ride-share program, but we need to make sure this isn’t some sort of a system that figures out how to circumvent accountability,” city council president Kathy Lantry said. “Our ordinances haven’t quite caught up with the changing face of new products, and this would definitely be a new product.
“It’s an interesting concept. It’ll be interesting to see who uses it, because, boy, it’s a whole different model.”
Lyft has no fans at New Hope-based Taxi Services Inc., which operates about 500 Airport Taxi, Town Taxi and Minneapolis Yellow Cab vehicles in the Twin Cities. It recently launched its iHail app.
Company president Steve Pint said existing licensing procedures for checking drivers and their cars are the best way to ensure the best and safest service for customers.
Besides, he said, anyone can apply for permits to provide taxi service in the Twin Cities, so why does Lyft resist doing so?
It’s not that simple, Zimmer counters. Because Lyft is so different from a traditional taxi company, the licensing forms supplied by the likes of St. Paul are almost impossible to fill out. They do not ask the right questions in many cases, he said.
Besides, he said, stringent driver-background checks mean only about 5 percent to10 percent of applicants ever make it into the driver pool. Via the app, riders know in advance who is picking them up and what that person looks like. Liability coverage in the amount of $1 million per incident is provided for riders and drivers. All vehicles get 15-point inspections.
Lyft chose to initiate local service solely in St. Paul, and not in the greater Twin Cities, in order to ramp up slowly and ensure sterling service, Zimmer said. Lyft trips must begin in St. Paul but can end anywhere within 60 miles, Zimmer said.
Because the company is only a year old, he added, it’s still experimenting with different kinds of markets and how to fine-tune service in such locales. St. Paul, a smaller city with a tech-savvy and cosmopolitan population, is a perfect testbed, he said.
Lyft this week also is launching in Indianapolis and Atlanta for a total of 10 cities, including its inaugural cities of San Francisco and Los Angeles.
Julio Ojeda-Zapata can be reached at jojeda@pioneerpress.com; Frederick Melo can be reached at fmelo@pioneerpress.com.
