Lyft Restructuring: Ceasing Dockless Bikes and Scooters

(Reuters) – Lyft has announced it will stop offering standalone dockless bikes and scooters, alongside job reductions, as part of a restructuring aimed at cutting costs.

The company, which manages the Citibike service in New York City and similar rental programs in other cities, indicated in July 2023 that it was exploring options for its bike and scooter unit after receiving significant interest.

“We are discontinuing our dockless scooters in Washington, D.C., and are exploring alternatives for our dockless bikes and scooters in Denver,” the company stated.

As part of this transition, Lyft will rebrand its bikes and scooters division as Lyft Urban Solutions. Notably, Lyft does not directly operate its bikes and scooters in several U.S. cities but collaborates with Bird and Spin, enabling riders to access these services through the Lyft app.

Lyft anticipates incurring approximately $34 million to $46 million in charges, primarily associated with asset disposals, and plans to lay off around 1% of its nearly 3,000 employees by the end of last year.

The restructuring is expected to enhance adjusted operating income by about $20 million annually by the close of next year through cost savings, improved operations, and better sales strategies.

Last month, Lyft projected a weak September quarter, raising concerns regarding its competitive position against Uber Technologies. Since CEO David Risher took over early last year, he has implemented job cuts and introduced increased driver earnings along with new initiatives to boost ride share demand.