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- Lyft is adding a new feature, making it easier to avoid surge pricing.
- The rideshare app's Price Lock option is aimed at daily commuters.
- It's Lyft's latest attempt to compete with Uber in the rideshare world.
Lyft's latest attempt to win over customers from bigger rival Uber takes aim at one of rideshare users' most frequent complaints.
Both platforms base the prices that customers pay for rides on demand and the availability of drivers. That often results in surge pricing during busy times, leading people to pay more than normal as they look for a ride home at the end of a baseball game or head to work during rush hour.
Lyft calls surge pricing "Primetime," and CEO David Risher admitted on an earnings call on Wednesday that it has a bad reputation among customers. "It's probably rideshare's most hated feature," he told analysts.
But Lyft plans to "open up a can of whoop-ass on Primetime," Risher added, by introducing a monthly subscription "that caps the price per specific route at a specific time." The feature, called Price Lock, is aimed at people who use Lyft to commute daily.
Price Lock will cost less than $5 each month, Risher said.
While surge pricing isn't ending, Risher said Price Lock "can chip away at how often it occurs" and give riders "a reason to choose Lyft."
An Uber spokesperson did not immediately respond to Business Insider's request for comment on Price Lock.
Rideshare apps like Uber and Lyft are some of the most visible examples of what the retail industry calls "dynamic pricing." They're just two of a variety of apps, such as Airbnb, that used to be much cheaper for users as part of the so-called millennial lifestyle subsidy.
But surge pricing has since become a common part of using rideshare services. Some rides can cost more than twice as much as other times, a magnitude that's appeared to surprise even Uber CEO Dara Khosrowshahi.
Companies in various industries have been expanding — or considering expanding — pricing that fluctuates based on demand.
Theme parks and fast-food chains are among those companies that have outlined plans to at least experiment with dynamic pricing.
Walmart said in June that it is planning to replace paper price tags with digital ones in 2,300 of its stores. The company told Reuters that it doesn't plan to change product prices hourly, though the digital tags will allow Walmart to update prices daily in response to changing costs from its suppliers.
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