An alternative rideshare app that gives all the fares to its drivers is proving popular among those who drive passengers around for cash in Toronto.
The rideshare app HOVR, which launched Toronto in May, saw an influx of 20,000 drivers looking to sign up for the service in the first month alone.
There is currently a large waitlist of potential drivers, with about 2,000 already active on the roads, the company said.
Drivers operate across the GTA but about 60 per cent of rides take place within Toronto's downtown core.
Unlike other rideshare apps such as Lyft and Uber, drivers receive 100 per cent of the fares from rides they complete. Those driving for Lyft receive at least 70 per cent of their fares, while Uber drivers make around 75 per cent.
“What’s important to me is that the driver is making somewhat toward a living wage,” HOVR founder and CEO Harrison Amit told TorontoToday. “It's really just about paying the driver appropriately for the conditions that they're going through to be able to get you safely from point A to point B.”
Fares are determined by a base fee, along with a per minute and per kilometre charge, similar to how traditional taxis operate.
On top of taxes and Toronto’s $0.30 per ride fee for rideshare apps, riders will also be charged an extra dollar per ride, which Amit said is how the company generates its income.
Drivers are also required to pay a monthly subscription fee of $20.
“It goes directly into the marketing side of the equation,” Amit explained of the driver’s monthly payments.
Amit said HOVR doesn’t use algorithms to determine fares or use surge pricing when there is higher demand. He claimed this pricing model has resulted in average fares being 10 to 20 per cent cheaper than competitors operating in the city.
For this reason, Amit said HOVR is the “more cost efficient” option among the rideshare apps used in Toronto.
The company’s founder said the high demand to work for HOVR has been a “blessing and a curse,” as he doesn’t want to oversaturate the market with too many drivers.
In order to get off the app’s waiting list, prospective drivers must provide proper documentation and have at least three months of professional driving experience.
“It's our job to get our ridership up so that we're just not just putting a bunch of drivers out there to drive around and not get rides,” Amit said. “We want to be able to keep them busy.”
He added while the company is too new to determine the average number of riders using the app, it continues to grow week-over-week.
Amit said the company will also take all lessons it has learned since its release in the spring with a new revamped “HOVR 2.0,” set to be launched in January.
“[This year] was more or less the ability for us to get all of the information from both riders and drivers while we kind of went through the motions of making sure that everything worked end to end, and providing that experience for the drivers that they expected, as well as the riders.”
Under Mayor Olivia Chow, the city has already made one attempt to limit the number of rideshare vehicles on Toronto streets, which was squashed by council late last year. Consultations on a second model that will impact the industry began in the summer.
