Two companies business strategies to compete with uber and lyft Megan Knox 1182016 Introductory Microeconomics PPPA 6017 Backstory Two companies Fasten and Fare enter the market to compete against Uber and Lyft ID: 540100
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Slide1
The fast-en and the Fare-iousTwo companies business strategies to compete with uber and lyft
Megan Knox
11.8.2016
Introductory Microeconomics, PPPA 6017Slide2
Backstory
Two companies, Fasten and Fare, enter the market to compete against Uber and Lyft
Fasten’s business model:
Charge drivers a $1 flat feeSees itself as selling information and connecting drivers and passengersThe formal service provider is the driver in a driver-passenger transactionRelies heavily on volumeNo more required “surge” or peak time for customersFare: allows passengers to select drivers upon requestSlide3
A viable contender to uber/lyft?
Fasten making a profit from early success in both Austin and Boston (price > AVC)
Ascended to the top spot in Austin for ride apps in 10 days
Fasten plans to add additional drivers and roll out a “drivers’ lounge”
Price
Quantity
MC
ATC
AVCSlide4
What can we expect for fasten?
Is this a perfectly competitive market?
In Boston, are Uber, Lyft, and Fasten rides indistinguishable?
Is the service really the same?
Price
"At the end of the day, we sell a piece of information to a driver who is the actual service provider […]They move them in the physical world from point A to point B. We sell a piece of information to the driver that someone needs a ride.“
- Fasten COO Vlad Christoff
Quantity
Quantity
Price
Boston
Austin
D
D
1
S
1
S
1
S
2
D
2
S
2