New ride-hailing service takes aim at Uber, Lyft
By Andria Borba
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PALO ALTO, California (KPIX) — While Bay Area-based Uber and Lyft have dominated the rideshare industry, a new service launching in parts of the Bay Area hopes to poach not only passengers but drivers as well.
The company is called Alto and just launched on the Peninsula. Just like Uber and Lyft – you use an app to call a car, but unlike those companies your driver won’t be a gig worker, but a fulltime employee with benefits.
“We want to deliver benefits for our drivers. We think that’s important, but also, consistent steady hourly wages. You come in to work with Alto – you know what your pay is going to be,” said Adam Vanderpool, Director of Operations for Alto.
This all comes after the millions poured into Proposition 22 in 2020 that allowed Uber, Lyft and the like to keep classifying drivers as contractors.
Another change, there will be no more roulette as to what kind of vehicle pulls up. Alto owns a fleet of Buick Enclaves and the company said it would transition to all electric in 2023.
“I think our customer base really cares about sustainability and I think that’s feedback we’ve got from the beginning,” Vanderpool told KPIX 5.
Olaf Groth, PhD with the UC Berkeley Haas School of Business says even in a seemingly bloated market, there’s a wedge Alto could expose.
“The market is ready for disruption by somebody who can differentiate. One of course is offering benefits to drivers — even part time drivers – possibly enhancing their commitment to the company and there are nicer cars on average – so a bit of a concierge feel to it,” Groth told KPIX 5.
That concierge feel comes with a price – an 18% surcharge on the ride that Alto says will give the drivers a regular, dependable paycheck with starting wages of $17 – $20 an hour. It could be a draw for drivers, currently feeling the pinch of astronomical gas prices.
“Alto bears the cost of the gas prices, as well as any maintenance, insurance, etc. this allows us to keep our drivers on the road and really focus on excellent customer experience ,” said Vanderpool.
At the moment, Alto is running 50 cars, with plans to expand by 200 by the end of the year and all around the Bay Area after that.
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