Gett Now Pays Drivers Over Twice As Much As Uber
Offering $10 rides anywhere in Manhattan brought in the users. Now they need the drivers. — When Gett Taxi, the dark horse competition in New York for Uber and Lyft, started offering a flat rate of $10 for rides anywhere in Manhattan, it put them on the map in NYC overnight.
Context & Ripple Effects
Gett's $10 flat rate anywhere in Manhattan, announced in early September as a play for the rest of 2014, did its job on the demand side — the company went from dark horse to a named rival of Uber and Lyft in New York almost overnight. The problem is the classic two-sided marketplace one: cheap fares mean more rides than the current driver base can serve.
This piece reports Gett closing that gap by paying drivers over twice what Uber does — a direct attack on the supply side just months after a widely-circulated analysis put median UberX driver net income at over $75k a year in NYC (that figure) . The pickup across TechCrunch, The Next Web, Forbes, and Business Insider shows how much attention a small challenger can buy by simply repricing labor.
First-order effects
- Gett drivers immediately become the highest-paid ride-hailing drivers in New York, giving the company a recruiting pitch against Uber and Lyft at exactly the moment its $10 fares are straining capacity.
Second-order effects
- Uber and Lyft face a forced choice in NYC: raise driver payouts city-by-city and compress their unit economics, or cede driver availability — and with it wait times and reliability — to Gett during the flat-fare window.
Third-order effects
- If both-sides subsidies become the standard competitive move, ride-hailing margins in dense markets get set not by technology but by which platform's funding lasts longest, making driver pay the visible front line of a capital-burn contest.
The trend: Ride-hailing competition is escalating from consumer price cuts to subsidized driver pay, turning the supply side of the marketplace into the battleground.