Similar to Uber’s surge pricing, Prime Time Tips will kick in whenever there’s a lot of demand and not enough drivers on the road.
Uber received quite a bit of flack in New York City earlier this month during a snowstorm. Some passengers were furious because they were charged anywhere from 1.5x – 8x more than usual.
But unlike Uber, Lyft gives all of the additional money to drivers, while Uber takes a cut from surge pricing.
Even though Uber has been the target of critics lately, Lyft co-founder John Zimmer says he’s not concerned.
“Users gave feedback that they were frustrated they couldn’t get a ride,” Zimmer told PandoDaily. “They said, ‘I wish I could give my Lyft drivers an extra five or 10 dollars when there’s no drivers available.'”
Lyft is also ditching its donation-based model in California to set payments determined by the company. The ridesharing service initially operated on donations because it wasn’t legal to charge for ridesharing in California. But as of September, the California Public Utilities Commission legalized ridesharing, allowing Lyft to make the switch.
It has also since expanded its service into the San Francisco East Bay Area, from Oakland to Castro Valley, and some of the suburbs of Los Angeles, Calif., like Pasadena and Malibu.