A new study that confirmed Lyft and Uber drivers discriminate against African-American riders shows the need for Black entrepreneurs to get into the ride-hailing space.
A dissertation published on Wednesday from UCLA’s Institute for Transportation Studies found that Black people living in low-income communities were the most frequent users of Lyft in Los Angeles County. However, drivers for ride-hailing companies Lyft and Uber were also more likely to discriminate against those very same customers, City Lab reported.
A 2016 study of 1,500 cases in Seattle and Boston found that Uber and Lyft drivers discriminated against passengers with Black-sounding names by deciding not to pick them up. This new study is one of the first in Los Angeles County. It also analyzed more than 6.3 million trip-level records obtained from Lyft. Most of the previous studies were based on surveys.
Although Lyft drivers were concentrated in wealthier Los Angeles neighborhoods, customers living in low-income areas made more Lyft trips per person. The main reason is that a higher percentage of people living in low-income communities did not own a car.
At the same time, Black customers also had longer wait times and more cancelations with Lyft and Uber—though shorter than traditional taxi services. Lyft drivers cancelled on Black riders 7 percent of the trips, compared to 3 percent for whites. Uber drivers cancelled on 6 percent of Blacks, but only 2 percent of whites. Black customers also had higher average wait times, nearly 2 minutes more than white passengers.
The disparity—in the face of being loyal customers—creates opportunities for Black entrepreneurs.
For example, Godwin Gabriel, CEO and founder of Moovn, is working his way into the ride-hailing space. The Tanzania native launched his on-demand transportation app in Seattle in February, Geek Wire reported. By April, his company was ready to start providing service in New York, Atlanta, Chicago, Los Angeles and Seattle.