New Delhi:- Lyft has been lowering prices to attract more passengers, and it has been successful. However, achieving that success has come with a real expense.

The company that offers rides reported on Tuesday that in the second quarter of 2023, they had more people using their services but earned less money from each person. The difference in prices happened because the company decided to price their products similarly to what other companies in the market were charging, said CEO David Risher.

Lyft made less money from each rider this quarter compared to the last, with a decrease of nearly 5%. However, the number of people using Lyft increased this quarter to 21,487 riders, up from 19,552 in the previous quarter.

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Lyft is not only trying to keep prices the same as Uber, but it is also trying to get rid of surge pricing, called "primetime" by the company.

During the earnings call on Tuesday, Risher explained that surge pricing can encourage more drivers to be available during busy times when the demand is high. However, it can also discourage riders from using the service if they have to pay extremely high fares just to go home after work.

Risher said that "primetime pricing" is a bad way to increase prices. "It's really terrible because riders absolutely despise it. " We are working hard to remove it completely, and since we have a lot of good drivers, it has decreased a lot.

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According to a spokesperson for Lyft, there are more drivers available than there have been in the past three years. The number of drivers has increased by more than 20% compared to last year. Additionally, the average number of hours worked by each driver has reached a new record, surpassing the levels seen in 2019.

Risher found that the percentage of rides impacted by surge pricing went down by 35% from the beginning of the year.

The executive said that it means they will earn less money. "But it benefits our riders and improves our overall market results. "

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In the short term, if Lyft stops using surge pricing, it could help them stand out from their rival Uber.

Lyft wants to make rides cheaper for each person and avoid charging extra during busy times. This is the only company that competes directly with Uber by offering similar prices.