Just as a lot of people say “Coke” instead of “soda” or “cola” (much to Pepsi’s chagrin), Uber has so thoroughly cornered the ride-sharing world that the company’s name is often used interchangeably, if informally, with the industry as a whole.
Uber (UBER) – Get Uber Technologies, Inc. Report controls 69% of the ride-sharing market, while Lyft (LYFT) – Get Lyft, Inc. Class A Report controls 30%. But hope springs eternal, and a newish company is trying to enter the field, and it has a few tweaks to the business model that it hopes will differentiate itself.
What Is Alto?
Alto started in 2018 and is currently available in Dallas, Houston, Miami, D.C. and Los Angeles.
Now it is about to launch in the South Bay of San Francisco and Silicon Valley. It is currently valued at $61 billion business worldwide, according to Forbes.
Just like with Uber and Lyft, users download an app to get a ride.
But Alto is aiming to offer a fancier alternative, with an emphasis on customer service and making the ride as luxurious as possible, with several amenities, including complimentary water, umbrellas, charging cables and Wi-fi in every vehicle, as well as app-controlled custom music playlists.
There’s also a signature “Alto scent.”
Alto buys all of its vehicles from General Motors and Volkswagen, and has plans to shift to an electric-fleet next year, and in a nod to safety, each vehicle has in-car and exterior video surveillance, a HEPA air filter and a plexiglass partition between drivers and passengers.
As with any luxury experience, it is going to cost a bit more, with an 18% surcharge on the ride for a price point described as between midway between UberX and UberBlack.
Alto
Alto Shuns the Gig Worker Model
But the main difference between Alto and the other companies is that all of its drivers are employees, not gig workers.
The company hires drivers, does a full background check and trains them for several days. It also offers performances coaches.
The drivers will use the cars the company provides, rather than their own vehicles, which will make for a more consistent, know-what-you’re getting consumer experience. The company also pays for gas and maintenance.
Every employee gets an hour salary as well as benefits, so in essence, the company is combining aspects of the old-fashion taxi experience with the modern ride share world.
The thought here, it would seem, is that a happier and more content employee base will deliver a more consistent experience to the customer, in the hopes they’ll be nicer and more professional.
Safety Concerns Continue to Matter to Riders
The emphasis on background checks and safety can help, at least in theory, alleviate the concerns that arise every time people read a story about someone being sexually harassed or assaulted by a ride-share driver.
This move also helps the company appeal to customers who make an effort to have their consumer habits align with their political beliefs.
Stories about gig workers feeling underpaid, overworked and generally exploited have become very common in the past few years, and every so often a particularly incensed tweet will go viral.
Uber and Lyft spent millions to make sure California Proposition 22 in 2020 would allow the companies to keep classifying drivers as contractors.
At this point, most people know that gig workers aren’t thrilled about how they are treated, but the convenience of ride sharing can overshadow a customer’s guilt. But Alto is offering an alternative that they hope can make riders and passengers feel better about the situation.
Alto currently has over 1,000 employees and more than 300 vehicles, and is dealing with headaches from the lack of available cars at the moment.
It has quite a bit of ways to go before it can truly start making Uber sweat. But for now, it’s hoping that there’s a customer base willing to pay more to feel good about their ride, both in terms of their comfort and their values.
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