How much does a Lyft driver make when renting a car to drive?

So, we are back with another experiment. This time revisiting one of my favorites — LYFT driving. You may remember, back in late 2015 I did an experiment trying to learn how much those driving their car for Lyft were actually bringing home after expenses. These days, you do not even need a car in order to drive for Lyft…or Uber, for that matter. Both companies have agreements with rental car companies so potential drivers can rent a car instead of using their own car or if they do not own a car. This opens up additional opportunities for those seeking to earn money with Lyft.

We’ll get into some of the experiences I encountered while driving, the finances, as well as weighing the positives and negatives renting a car through Lyft’s Express Drive Program. Scroll down to the section that interests you most. My Lyft/Hertz rental car is due back on Thursday; will I turn it in or keep on with the fun?!?!

Drivers for Lyft are as varied as the riders. Some drivers are actually millionaires or well-off people (some retirees) seeking to find something to do, while others are just normal people needing to get income and have been living paycheck to paycheck. You have the freedom to go on or off the driving platform at will, so this is a great choice for those seeking to maximize the freedom of their time. Use this link to start driving for Lyft!

Spoiler alert: Renting a car through Lyft’s Express Drive only makes sense if you are doing this full time. Everything mentioned herein relates to South Florida driving and “based” out of Southern Palm Beach County. This blog post is also only based on two weeks for the experiment. Situations may be different in other cities.

POSITIVES and NEGATIVES to RENTING

POSITIVES

• No wear and tear on your own car (driving 200-300 miles each day is typical for a full-time driver)
• Ability to earn money when one does not own a car
• Most of your costs are that of gasoline and car washing
• All insurance and maintenance are included with the rental cost — minus tire flats and should you end up with a cracked windshield. As well, there is a $1,000 deductible on the insurance.
• Make at least 100 rides each week will bring the cost of the rental down to about $95 per week (from $237)
• Freedom to work your own hours as well as start and stop from any location in South Florida
• Unlimited miles and the ability to use the rental vehicle for personal use
• No long term commitment
• Tax deduction of 58 cents per mile (includes all miles while on the platform not just when the passenger is in the vehicle)

NEGATIVES

• Somewhat limited availability of rental cars, as well as the variety of vehicles available (this is not a typical Hertz car rental arrangement)
• Cost – if you do not meet a certain number of rides, then you are on the hook for the entire $237 per week rental cost
• Need to travel to/from Dania (near FLL) to pick up and drop off the rental car
• $250 deposit (refundable)
• Limited to only driving on the Lyft platform and NOT Uber with the rental car

FINANCES

OK, so let’s see if all this makes any sense to do. When I first learned about this rental car program I could not understand how anyone could earn money renting a car as a driver. The results show that if one is driving casually or to supplement their income by driving part-time, then I do not recommend renting a car to drive for Lyft. Driving part-time, you are not likely to meet the threshold to qualify for $140 per week of rental rewards which would make your per hour net not worth doing, in my opinion.

I took on this experiment again after reading some drivers were making only $5 per hour and yet would read elsewhere $35 per hour. Additionally, I head up a Meetup discussion group where one question posed was, “What was your favorite job?” I had to admit that my stint in 2015 driving for Lyft was the most fun way I had earned money in my 50 years.

You are not going to get rich driving for Lyft, but you will earn an average income. The average Palm Beach County resident earns around $50,000 per year and this is within range of a full-time, quality Lyft driver — at least from my experience.

So, let’s assume you are driving a minimum of 45 hours per week and preferably over 50 hours each week. This amount of time would be typical for a regular job. The advantage here is you have the ability to go on and off the driving platform at your whim. The least busy day of the week in South Florida seems to be Wednesdays. Lyft shows this through their demand graphs and I have confirmed this myself. Much to my surprise, my busiest day of the week is Sunday. If one is considering driving, I would recommend driving six days a week and taking Wednesday’s off. By law, you are only allowed up to 14 hours a day to drive, no matter how you split those hours up during any 24 hour period.

The bottom line is you can net $800 to $1,000 per week driving through Lyft’s Express Drive program. Your costs are the gas and the rental car. If you are trying to determine your net per hour, it comes in at between $15 to $20 per hour. This can increase if you drive a more fuel-efficient vehicle and choose to drive in the evenings, assuming you have the temperament to deal with drunk people. I am super nice to riders and have a gregarious personality; however, dealing with the logistics associated with picking up drunk riders is an experience which I have little tolerance.

The rental car I was able to choose was a 33 average miles per gallon Hyundai Elantra. If one was able to get a Prius (50+MPG) for example, your net margin would obviously be greater. Another consideration is you are able to write off as a federal tax deduction all the costs of rental including operational costs or take the 58 cents per mile deduction (see your tax professional).

If you are facing a large tax bill before taking on this endeavor you may want to consider foregoing the rental car program and buying a Prius or other 50+ miles per gallon vehicle as you will likely be able to write off the entire purchase cost of the car. If this is a factor, make your decision after consulting your tax professional as everyone’s tax liabilities are different due to their personal situations.

EXPERIENCES

WOW! So, the experiences…one could write a book. If one is looking for variety, freedom, and fun, then driving for Lyft is for you! You will pick up people from all walks of life and take them to all sorts of places — it truly runs the gamut. If you like people and you like driving, this could be the profession for you.

You can drop off someone in a lower income area and next pick up an individual who owns a $5+ million home. I truly appreciate the upper-income people taking a regular Lyft as, unless they have requested a “Lux” or “Lux Black” Lyft, they do not know if you’re showing up with an average car or a little Corolla. They are the most down-to-Earth wealthy people and like everyone else, are just looking for a nice ride to their destination.

Just like there is a wide range of riders, drivers do not know if they are going to be on Palm Beach or Key Biscayne. They could be at the beach one moment, then way out in horse-country the next.

I guess the biggest change from 2015 to now with regard to riders is that back then, about 40% of my riders were recovering addicts. This time around it is rare to pick up those in recovery. I never had a bad ride with any addicts, so I do not care, it is just an observation. Most people seeking a ride are mostly going to work, going to the airport, or are doing the “walk of shame.” During this experiment, I was going out at 5 a.m. so early morning experiences may be different than 5 p.m.

Sometimes, you end up being somewhat of a psychiatrist. During this experiment, I had a man my age start crying in the back seat as he opened up about how his life has changed recently. One of my first rides was a 20-year-old girl who had gotten herself in a very difficult situation at a Super 8 motel that I “rescued” her from. Rescue is a valid word for what happened which is similar to another rescue I did for another single girl in 2015 in Fort Lauderdale during my prior experiment.

Another time during this experiment, I picked up a 30 +/- year old man on Sunrise Blvd in front of an apartment complex for which he exited after hooking up with a girl overnight. He seemed like a super nice guy and we had a great conversation during his ride. I was shocked to see I was dropping him off at his waterfront home, where the yacht at the dock in the back was bigger than his large multi-million dollar home.

Often, a driver has riders who work for billionaires in $20+ million homes. I had a ride yesterday for the chef of a well-known billionaire who I was glad to see honoring the NDA (non-disclosure agreement) he signed as a condition of his employment. Not that I was asking for any information, but it was a welcome contrast to an experience I had with a staff member for a South American billionaire who spouted out all kinds of awful details about the family.

Then sometimes you just have rides where people are engrossed in their phones and choose not to communicate with the driver, which is fine. After all, Lyft is somewhat of a utility. Overall, drivers are there to serve and offer the best experience for the riders. Some riders want to talk, others do not, and that is OK.

The funniest experience during this 2019 experiment happened just the other day. I picked up a young gentleman at his house in the Eastern part of Delray Beach and he was going to a bank out on Jog Road, then heading back to his house. I thought he was going to sign some papers, as there are EIGHT other branches of this bank that were closer to his home, but I quickly learned he was only going there to withdraw cash from its ATM! While at the ATM, he discovered he didn’t have any money in the bank, so he spent the time on the way back to his home on the phone with the bank trying to understand why he doesn’t have any money. Shouldn’t he have checked his balance before he left his home? Shouldn’t he have used an ATM closer to his home to save on the cost of the Lyft? The ride cost him over $20 and though I felt bad for him, I think I know why he didn’t have any money in the bank that day.

Here are a couple of examples of where I drove during a couple of the days:

The absurdity of Chicago’s rally of Uber & Lyft drivers

Today, drivers for Lyft and Uber are planning a rally to protest their low “wages” and the abuse some have taken while driving. It is absurd because they are all independent contractors and have the option to leave and do something else.

One female driver said she was tired of being “hit on” by riders. Another driver complains that he is only making a net profit of between $10-12 an hour. Then stop driving and do something else. It’s a far better idea than standing around, spending hours protesting for no money when you could be spending those protesting hours finding another gig or driving.

Perhaps these disgruntled drivers could change their mindset from that of an employee to that of a business owner. This can be seen when a driver describes the revenue and profit he or she generates as “wages.” When I have taken rides with Lyft and Uber, I can tell within a minute or two if the driver is thinking like an entrepreneur or an employee. Almost universally, the experience with the entrepreneurial thinking driver is far better than those who think as an employee.

 

Uber and Lyft Have Shuttered Their Services in Austin — Fortune

On-demand ride companies Uber and Lyft suspended their services in Austin, Texas, on Monday after a stinging loss in a weekend vote where they had spent heavily to repeal a city ordinance requiring them to conduct fingerprint background checks for their drivers. The defeat in Austin could encourage other cities to back the fingerprint-based criminal…

via Uber and Lyft Have Shuttered Their Services in Austin — Fortune

How much money can I make with Lyft or Uber?

This post is a follow-up to a blog post I made in September titled “My two days as a Lyft driver” detailing my initial experiment driving with Lyft (similar to better-known Uber). That post resulted in my receiving many inquiries focussed on the question of how much money someone can realistically make wth a ridesharing tech company such as Lyft or Uber. So I decided to try and go one week being in “driver mode” for 40 hours in to mimic a “normal” person’s full-time work week.

Unfortunately, because I have many other activities on my plate, I did not make it to 40 hours but did make it to 30 hours. There are two ways to look at earning money as a ridesharing driver, one as a worker bee (earnings by the hour) or from a business perspective (net profit). Let’s explore the financial end before getting into a few memorable ride experiences for the week.

First, let me suggest I could have made far more money if I didn’t have other obligations in my life and if I had focussed on making as much money as possible (see below). I also only drove for Lyft and not Uber for the week. I also focussed the week on Lyfting mostly in the Boca Raton/Delray Beach region during the day. One can make much more money driving at night and in more population dense areas like Miami Beach for example.

Another aspect of the ridesharing experience I would like to mention is how Lyft and Uber are self-regulating. Although most passengers realize they have the ability to rate the driver, most do not realize the driver is rating them as well. With Lyft, if either the passenger or driver gives a rating of 3 stars or below (out of 5), then those two will never see each other again. The purpose is to have a great experience for both the passenger and the driver, so if one is not happy with the other, then there is no purpose in matching them up again. If there is a driver doing something wrong, inappropriate or just giving poor service, that driver will not be on the driver platform very long, thereby not picking up any passengers. The same regarding the passengers. If a passenger is consistently unruly or bad-mannered, then they are going to get a poor rating and will find it hard to get a ride. Based on convos with some of my passengers, this has happened to a few of them on Uber, which is why they are now trying out Lyft. They could no longer get a ride on Uber because they’d been too drunk or whatever the reason. I can say, not one ride I gave was a bad experience.

What was my net profit for the week?

I drove a total of 30.8 hours, gave 37 rides and netted $329.31 after car expenses. That comes to $10.69 per hour. Not overly exciting, but pretty good if you’re out of work or looking to pick up some extra money for the holidays. My prior blog post showed me earning $13 per hour for my first two days. That said,  I truly believe that if someone did this full-time and didn’t mind working nights and putting in a minimum of 50 hours per week, you’d make $20-25 per hour after car expenses.

Now when I say, “I drove a total of 30.8 hours,” that simply means I was on the driver platform (on-call) for that time period. I was not driving rides to their destinations and may not have necessarily been driving around.

I did not factor in the tax savings because as a driver your phone, cell, data, text service, much of your car expenses, etc. now become tax deductible. I did not factor that in because that will affect different income level people differently, but it is not something to ignore.

How could I have made more profit and earned more per hour? 

One way would have been to drive more. This sounds counter=intuitive, but Lyft (and I believe Uber on some level) gets a commission for each ride you do. After all, they developed the technology (it’s their platform) and are making it very simple to acquire rides, so they deserve a cut. The standard is commission Lyft takes is 20% of your ride total (minus tips). This is reduced to 10% once you are on the driving platform for at least 30 hours and is eliminated COMPLETELY if you are on the driving platform for 50 hours or more during the week. This is a great incentive as my income for the week could have been given another boost had I stayed on longer as I would with any normal full-time job. Although I do not look at it this way, an hourly employee’s mindset may consider that overtime pay.

As I mentioned earlier, another way to earn more would be to focus more time in Miami Beach, Miami, Fort Lauderdale. It goes without saying that the more rides you make, the more money you’ll make. Spending time in a more suburban area as I did this past week is good, but without that population density, a driver is traveling farther to get to the person requesting the ride and there are fewer people looking for a ride.

Referrals are also another great way to increase your weekly income. Both Uber and Lyft offer this incentive and it is truly a win-win-win scenario for all involved. I will focus on Lyft because that is what I have experience. If you become a Lyft passenger using my link code then I will get a referral fee and you, as the passenger, will get some free rides so you can experience Lyft without any risk. If you become a Lyft driver using this link code then both you and I will receive a financial benefit. The incentives change frequently and it depends on your city, but you could get a $250+ “signing bonus” for becoming a driver. This is on top of your regular income driving.

Another way to make more money is to make sure you are available for prime time, which so far, is almost always in the Miami area. Lyft will pay you anywhere from 25 to over 100% more than your average ride income during certain hours of the day in certain areas. They call them “heat maps” where there is a need for more drivers due to high demand. This can be during rush hour during the day, rainy evenings, or recently most anywhere in South Florida during Halloween evening.

One could also have a more fuel efficient vehicle to net themselves more cash. I was using a BMW X5, but it would seem to me that a Toyota  Prius would be the ideal vehicle for a ridesharing driver. I have owned a Prius before and they are very low maintenance while getting 50+ miles per gallon. Buying your fuel for less money obviously, would net you more profit with each ride. It is important to note that one can be a driver in a Toyota Corolla or a Bentley, it doesn’t matter. Though you will earn a bit more money if you have a larger vehicle. And with Uber, if you have a high-end vehicle, then you can earn even more.

Lastly, before I get into some of the rides, you can earn more money by keeping your car clean and even more importantly not getting lost and knowing your way around. Nothing irritates a passenger more than you showing up at a different location or not showing up at all. Although the Lyft experience is meant to be a bit casual, that is not to be at the expense of getting from point A to point B safely and efficiently.

The Rides

As mentioned earlier in this post, I gave 37 rides this past week. The most memorable was picking up two young girls from a college campus on their way to a popular mall. The girls spent the morning getting stoned in their dorm room (I know, that never happens because weed is illegal, especially on campus) and one was on her way to a job interview with an high-end store. They were laughing hysterically and having a good time, but what was the one girl thinking??? I would have loved to have been a fly on the wall for that job interview.

One thing I have heard from multiple young single women who I have given rides was how safe they feel with Uber and Lyft. Some said their experiences taking traditional taxis was one of dread. The most common complaint cited was the leering of the taxi driver. Single women rightfully feel that Uber and Lyft drivers are not going to harass them and they told me are more professional. This is funny to me because the taxi drivers are supposed to be the professionals in this industry.

I picked up one girl who had spent the weekend with her on again, off again boyfriend. I took her to the airport and we had a great conversation about life in general and how much she loved her first-time here, though had no intentions on moving here.

Another girl was in town for her friend’s 30th birthday party. She commented on how terrible the taxis are in NYC and how much better Uber and Lyft are. She even takes Lyft and Uber instead of her company provided black car service.

One gentleman has been through hell and back and this past week got another dose of hell. Although clean, he has had serious issues with addictions in the past, which is why he uses Lyft regularly. The government took his drivers license away. Within a day of losing his job late last week, his girlfriend left him. He had a positive outlook and I am not sure I would have been in his positive frame of mind. He’s an impressive guy and if you have a job available let me know.

I had a great conversation with a young guy on his way to a church function. He is an impressive person who I think is going to be doing some great things with his life.

There is also some confusion with some people who are new to using the Lyft app. One guy’s first ride with any ridesharing service was with me to PBI and he ordered it up well in advance because he was afraid he wouldn’t make his flight. I got to him in 3 minutes and he was stunned. He thought he’d have to wait 45 minutes like a regular taxi. We had a great time talking about his move back to his hometown.

Conclusion

All in all, I have not had one bad experience carting people around town. It is actually more enjoyable than I would have thought! None of the time did it seem like a job and would highly recommend the service, either as a driver or passenger.

The passengers and drivers come from all different backgrounds. One day you may be picking up someone at an oceanfront mansion and another in a low-income area — all are welcome rides in my car. And you never know where you’ll end up which is part of the fun.

There is so much more I could say about this past week and none of it is negative. Lyft is a great service for our community, one that should be embraced.

Below are some comments passengers made to Lyft about me. I do not see comments until the next day when Lyft sends me a summary of my day’s activities, nor do I know who made the comments.

“Awesome guy! One of the most comfortable rides I have had”

“Karl was great!”

“Hilarious!”

My two days as a Lyft driver

Some who know me well, know I like to do “experiments” and experience things a bit out of the ordinary. For instance, since it has become mainstream to have a smartphone, I went almost all summer with a “dumb” phone — no camera, no apps. It was both liberating and occasionally frustrating. I have since come to my senses and am again using a smartphone.

As part of another experiment, this past Friday, September 11, 2015, I was approved to become a Lyft driver. If you are not familiar with Lyft, it is very similar to Uber, but a bit more casual and IMO, fun. If you do not know what Uber is, when even my mother knows what it is, then I can only assume you are not from this Earth, in which case, this post will be meaningless. This past summer, all around good guy Earl Stewart of Earl Stewart Toyota gave me the idea, as he had become an Uber driver. As well, I have written extensively about the regulations facing ride share tech companies like Lyft and Uber for some time, even including a couple of posts here on this blog. So, I thought I would immerse myself in this new age of sharing rides which has the taxi companies all up in a huff. And just to qualm any fears, I did not drive around town with a large pink mustache attached to the grill of my BMW.

Uber and Lyft drivers come from all walks of life, some are retired, some are millionaires looking for interesting experiences, some are young people trying to get by and some are your typical “soccer moms” who are looking to earn a little extra money for the family. Heck, even politicians  have become Uber drivers.

I started off early Saturday morning and my Lyft ride was this person’s first Lyft – so we already had something in common since he was my first Lyft. What a great guy — interesting and fun. I picked him up on A1A as he was leaving his girlfriend’s place and needed a Lyft to his office. We had a great conversation on the ride to West Palm Beach. My next Lyft was for a great young guy, in college for sports medicine and aspring to become a sports doctor and open a sports management company in the future. He was leaving an overnight shift and needed a Lyft home — super interesting guy.Another was taking a young guy to work in Boynton Beach who had come to Florida by way of San Diego following a girl. According to him, it was a big mistake as he was now “stuck” in South Florida without the girl and without his prior job, which he loved — working on a sports fishing boat.  My last Lyft of the day (I was only on the driver platform for two hours) was driving a nice young lady to her work in the West Palm Beach area.

All and all, though I was only out two hours, I derived this could be a good way for someone needing some extra cash, or someone to do this full time. I have calculated I would net $13 per hour after car expenses, which is more than many low-wage Palm Beachers make. If they had a quality car, like one from Earl Stewart Toyota (shameless plug, even though I have no financial connection to the company), they could do alright. Admittingly, I did not drive during the reportedly more lucrative times (at night during the weekends and special events) so the $ per hour number could rise substantially if drivers drove during those times. One friend said he made over $1,000 driving on a recent Friday and Saturday night.

I went out Sunday, intermittingly — in the morning for a time, mid-day, and for an hour later in the afternoon. I had six Lyfts which were mostly people going to or from work and one Lyft was from a group of people leaving the beach. I ended the weekend doing ten Lyfts and getting a 5 out of 5 rating from those who rode with me.

What I discovered in this admittingly limited window into the ridesharing world, is that most people using Lyft (and I assume all ridesharing companies) are hardworking, honest people just looking to get ahead in this world. It was inspiring, frankly.

I do not know how much more Lyfting I will do, but overall it was fun and interesting. As you can also guess, I feel the regulation stranglehold our elected officials are trying to use to ruin the future of transportation is appalling. Those calling for more regulation are doing so at the behest of the old, traditional cab companies, which according to everyone I’ve asked, offer far worse service than either Lyft or Uber. Rather than scale up their businesses, they are attempting to use the strong arm of the government to shut down their competition. Commissioners say they are doing it in the name of “safety” but NOT ONE person has come forward to offer ANY evidence Lyft or Uber are any less safe than traditional taxi companies and there is even mounting evidence that companies like Lyft and Uber are making things SAFER on the roads. Heck, even MAAD has come out in support of ridesharing companies like Uber and Lyft. Bureaucrats have temporarily succeeded in beating down the high-tech newcomers in Broward County where Lyft and Uber are  no longer permitted by the county government to pick up rides and the county is far worse off for doing so. Fortunately, Broward County Commissioners are meeting this month to fix what they screwed up due to high demand from citizens who are fans of both Uber and Lyft.

One last thing, if you want to try Lyft, use this link to get a free $20 first ride!

IF you think you may want to become a driver, use this link to get a BONUS!

BROWARD UPDATE: Since this blog post, Lyft and Uber are legally back in Broward County with the added ability to pick up and drop off and the Fort Lauderdale Airport and the cruise port.

GENERAL UPDATE: I will be doing another Lyft experiment the week of November 9, 2015, driving for 40+ hours to see what it is like full-time. What can I make financially? Will I continue to enjoy it or will it seem more like a job? Find out the following week when I post here on my blog. Follow this blog to find out!

Uber and Palm Beach County Commission meet in epic showdown tomorrow

In what is expected to be quite the show for spectators and stakeholders, the Palm Beach County Commission will meet tomorrow to discuss the future of Uber and the future of other similar tech companies serving Palm Beach County. County commissioners have been in bed with the traditional taxi and limousine business industry for years and Uber has presented a credible threat to their old, obsolete business model. Rather than embrace the change, in February county commissioners introduced an ordinance to force livery drivers to pass an invasive background check even though the prior system was proven to be reliable. The effect of this and other aspects of the new regulation would be less Uber and Lyft drivers on the road, diminishing service to county residents. Many drivers and potential drivers do not want to be fingerprinted for privacy reasons and the extra cost involved, not because they have anything to hide, as what was suggested by one commissioner.

Uber has not backed down to the commissioner’s new and arduous regulation, promising to stop doing business in the county at the end of their temporary operating agreement which expires at the end of September. Uber called Broward County commissioner’s bluff last month, leaving the county, only for those county commissioners to deal with the wrath of very unhappy residents. Broward County is now reconsidering their heavy regulation in favor of a more free market solution.

Specifically, this past February, Palm Beach County Commissioners passed an ordinance that livery drivers must pass a “level 2” background check which would need to go through the government, even though “level 1” background checks (done through private companies) have proven effective for decades. County commissioners have offered no proof of the necessity for the extra background checks which cost drivers more money and are more intrusive resulting in less Uber and Lyft drivers available to service residents. County commissioners have consistently and often spoken about the need to protect the safety of the public, yet there has been no evidence shown the public is at risk or that the public would be better protected with the additional government regulation. Uber has stated it will not comply with the heavy regulation the county is demanding. The county commission, contrary to their public comments, has proven that it is more interested in protecting and serving the livery industry in Palm Beach County, instead of its constituents.

READ THE FULL ARTICLE HERE!

Americans work to reverse Uber’s ban on firearms

Last week we learned that Uber was going to begin prohibiting drivers and customers from carrying legal weapons in Uber vehicles. Uber’s main competitor, Lyft, has a similar policy. Customers have been vocal about their displeasure with the company’s decision and a petition was started online hoping to reverse the ban.

The ban is a clear violation of the driver’s right to carry as the driver is using their own car, not Uber’s car. It also makes the driver less safe from a potential carjacking, robbery or assault. It also makes those seeking a ride via Uber’s app vulnerable as they will no longer be able to carry their firearm, even though they would otherwise it would be legal to do so. Uber classifies their drivers as “independent contractors,” not employees. So Uber does not have the right to prohibit one’s constitutional right of self-defense and ability to bear arms.

Licensed permit-holders are some of the most law-abiding citizens in the country and have undergone a very extensive background check. Much more extensive than Uber’s own background check.  Prohibiting weapons doesn’t make anyone safe, except the criminals. Even a licensed Uber driver in Chicago saved lives by firing on a criminal shooting into a crowded street.  Prosecutors declined to press charges against the driver because he defended others.