- Ride-hailing company has focused on battling Uber at home
- Startup has teamed up with Uber rivals instead of going global
Lyft Inc. may finally open up outside its home country. The second-largest U.S. ride-hailing company will “very likely” expand to other countries, said John Zimmer, the president and co-founder of Lyft.
As Uber Technologies Inc. spread to hundreds of cities around the world in the last few years, Lyft has focused on the U.S. The smaller San Francisco startup is defending its home turf from Uber partly by spending aggressively on marketing, including promotions targeted at riders and drivers in major U.S. cities. Lyft has also formed partnerships with other Uber rivals outside the U.S. to make their apps work together.
Speaking onstage at the Fortune Brainstorm Tech conference in Aspen, Colorado, Zimmer didn’t specify when the company might expand or where it plans to go. A Lyft spokesman declined to comment.
Lyft’s global alliance includes China’s Didi Chuxing, India’s Ola and Southeast Asia’s Grab. Zimmer said at the conference that competition is particularly aggressive in China, where Uber and Didi are battling for turf. Uber has said it plans to spend at least $1 billion a year in China.
While Lyft maps its route for expansion, the company has been working with Qatalyst Partners LP on potential deals, people familiar with the matter said last month. In an interview on Monday, Zimmer declined to comment on Lyft’s arrangement with Qatalyst or whether he would like to sell the company. “We’ve hired multiple financial advisers in the last year-plus,” he said.
Zimmer appeared onstage in Aspen with Dan Ammann, the president of General Motors Co. Lyft said in January that the automaker would invest $500 million into the startup. The companies are working together on renting cars to drivers in some cities and on testing self-driving vehicles.
Lyft’s costly battle with Uber in the U.S. has shown signs of success this year, but the startup is trying to keep costs in check. It promised investors that it would cap losses at $50 million a month, a person familiar with the matter said in April.
At the Fortune conference on Monday, Zimmer said: “We have more than enough money now to get to break-even.” He didn’t say how Lyft would achieve that.
Ride-hailing companies could reduce their losses by cutting back on driver incentives, taking a larger fee from drivers or increasing fares. They’ve been reluctant to make such changes and risk ceding ground to their main competitor or face slower growth. Even as Lyft continues to spend on marketing in the U.S., the company told investors last month that it expected ride growth to be flat or down in June.