Lyft Teams With Shell, Hertz To Challenge Uber, Give Drivers More Benefits

SAN FRANCISCO -- Lyft is giving drivers more incentive to choose the pink-mustached ride-hailing service over Uber with a new instant-pay feature and new partnerships with Shell and Hertz that will give them discounts on gas and let them rent cars at lower rates.

Lyft is the clear No. 2 to Uber, but in the past few months, the startup has been working on a number of strategic partnerships to keep pace with its crosstown rival, including joining forces with Chinese ride-hailing startup Didi Kuaidi and teaming up with Starbucks to give drivers loyalty rewards from the coffee company. The partnerships with Shell and Hertz announced Thursday boost their strategy.

By working with Lyft, drivers will be able to earn discounts anytime they fill up at a Shell gas station. The discounts will be based on how often they drive, meaning casual drivers will earn a few cents off per gallon while top drivers will be able to fill up for free. The Shell partnership kicks off "over the coming months" for drivers in San Francisco, Chicago and Boston, but Lyft said it is hoping to extend the benefit to drivers across the U.S. by early next year.

"The more you drive the more you save," David Rust, Lyft head of operations strategy, said.

Lyft's partnership with Hertz, meanwhile, will allow users who don't own cars to also be drivers by renting vehicles at special rates on a daily, weekly or monthly basis. Lyft Vice President of Partnerships Oliver Hsiang said there are 60 million Americans over the age of 25 who don't own cars -- this new partnership could allow Lyft to tap into that pool. The relationship is also expected to benefit existing Lyft drivers in case their cars break down and have to go in the shop for a few days. Lyft's alliance with Hertz is already live in Las Vegas and will extend to other markets in the future.

Finally, Lyft also introduced Express Pay, a feature that allows drivers to instantly cash out earnings whenever they want, as long as they have earned more than $50. Normally, drivers get paid every Tuesday -- but with the new feature, drivers get more flexibility to cash out anytime they might need extra cash. The cost is 50 cents per cash out, but the money will show up instantly on drivers' bank accounts. Express Pay will launch in early November. "We're going to be there whether it's for unexpected travel expenses, for students to pay for books, this money will be yours," Tali Rapaport, Lyft's vice president of product, said.

The new partnerships and Express Pay were announced at an event where Lyft played up the benefits of driving for its service. The startup announced that to date drivers have earned $40 million from tips, a feature not available on Uber. Additionally, the company touched on its recent partnership with Didi Kuaidi, emphasizing that 8 million people travel between the U.S. and China every year. For drivers, that means anytime a Didi user hails a ride within the U.S., they will be connected to a Lyft driver.