"I really was gobsmacked, Risher said during an interview as he recalled being recently asked to replace Lyft co-founder Logan Green as CEO.
Risher quickly shook off his initial shock and is now making an effort to reverse the San Francisco company's mounting losses and sagging stock price. Just days after taking over as CEO, Risher came up with a restructuring plan that includes laying off nearly 1,100 employees whose job losses could help him attain stock price incentives potentially worth nearly $1 billion.
Like any mass layoff, the payroll purge will uproot the lives of those suddenly out of a job while sowing uncertainty among Lyft’s remaining 3,000 employees. But Risher believes the deep cuts had to be done so Lyft can afford to bring down its fares to the same levels as its longtime rival, ride-hailing leader Uber, which has rebounded from the pandemic much more robustly.
“It’s very important to our customers that when they open both (the Uber and Lyft) apps that they are not surprised by the prices being super different,” Risher said. “We want to be in line with where Uber is.”
The cost-cutting also will help Lyft pay drivers better, another element that Risher believes is needed for the service to offer more rides with quicker pick-up times.
Mobile tracking data compiled by wireless network testing firm GWS found Lyft’s driver app now averages about 400,000 daily usages — half its pre-pandemic levels — while Uber’s driver app boasts about 1.4 million daily users, roughly the same number that it had leading up to the pandemic.
The problems facing Risher are an offshoot of pandemic-driven restrictions that dramatically curtailed travel during most of 2020 and much of 2021, shriveling demand for rides on Uber and Lyft.
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