Lyft And Uber Offering Generous Discounts Before Going Public

As ride-hailing giants Uber and Lyft both prepare to go public on the New York Stock Exchange, they have started offering generous discounts to users, The Information reports.

Lyft was reportedly the first of the two to ramp up its discounts across the United States in a bid to convert Uber users to its platform. It’s working. According to The Information’s report, Lyft extended its discounts to roughly one-third of all recent trips, helping the company to gain an additional 4 per cent of the U.S. rideshare market. As a result, Lyft holds a 34 per cent share of the market while Uber has a 66 per cent share.

This gain in market share, though, will be particularly beneficial as Lyft edges towards launching its IPO road show during the week of March 18 and becomes the first publicly-traded ride-hailing firm in the United States. Any additional market share it can gain will help to attract more investors.

In response to Lyft’s move, Uber followed suit with discounts for many of its users. Uber remains the dominant force in U.S. ride-hailing, but it too will want to increase its market share prior to its IPO.

Lyft expects to be valued at between $20 billion and $25 billion when it goes public. By comparison, IPO bankers believe Uber could be valued at up to $120 billion when its IPO is launched, most likely 2-3 months after Lyft’s.

Lyft operates exclusively in the United States and Canada and won’t attract as much international interest in its IPO as Uber. The latter operates in more than 70 countries and has also diversified into the world of food delivery, air taxis, and artificial intelligence.