Here are the Industries Being Mangled by Über and Lyft

Über and Lyft are not only crushing the taxi business but also the rental car business.

The collapse of business travel spending on taxis and rental cars is extraordinary.





 Über’s and Lyft’s combined share of the ground transportation market in terms of expense account spending in the second quarter of 2017 has soared to 63%, with taxis plunging to 8%.

 It was only 2 years ago that Q1 2015, when expense account spending on Uber equaled spending on taxis for the first time, each with 25% of the market; rental cars still dominated with a 50% share. But that was two years ago, rental cars are now at 29% Uber’s growth has continued despite the seemingly never ending disasters that continue to occupy the news.

And Lyft’s rate of growth has surged from 3% a year ago to 8% now. In an analysis of major U.S. metros, taxis lost ground everywhere except Miami and Atlanta, while Lyft picked up share everywhere but Miami. Conversely, Uber lost between 1-6% in every city but Chicago where the ride-hailing leader gained 1%.

 In Q1 2017, the most “expensed brands” in overall business expense reimbursements are: Uber 7% of the total; Starbucks 4%; Delta Airlines 4%; American Airlines 3%; Amazon 3%. And in Q2 2017, despite all the problems Uber has had, its share of overall expense reimbursements jumped to 9% and was once again “the number-one most expensed brand processed by the Certify system.” Uber is also taking business away from other sectors. It shows up in the number of Uber business-expense transactions of $100 or more. With 3.6%, Uber had the greatest number of transactions over $100 compared to Lyft at 0.4%. Because of the significantly lower cost, business travelers are using ride services in situations where hotels, car rental or other services might have been used in the past.

People, instead of staying in a hotel, use Uber instead of trains or short hop planes. This trend also has consequences for the hotel sector, airlines on short hops, and other travel services. Ride share companies have spent a ton of money on the shift to autonomous cars and they will become far more competitive when they get rid of drivers. With the large amounts of money rideshare companies have raised worldwide, they’ll be able to continually expand and demolish a number of other business sectors.

 Overall car ownership will experience significant negative growth as more people in urban areas decide that it’s easier and cheaper to pay per ride when needed rather than paying 24/7 for the overall expense and hassles or owning, driving, parking, and maintaining a car. And they can use their computer or cell phone legally while being driven.

The entire auto industry is already rethinking its business model. GM, faced with plunging car sales and soaring car inventories, has started discussions with the UAW to eliminate six car models. Entire plants are at risk.

 Major industry disruption is accelerating.

Source:  www.BobPritchard.com