Sidecar ends donation fares

In a move away from the ride-sharing tradition, Sidecar on Friday announced that it will no longer be a donation service.

Sidecar, the San Francisco-based hire-a-ride company, released a new version of its smartphone app, which requires that passengers pay drivers a set fare. The amount is established when the passenger books the ride, and they can choose to pay more at the end of the ride for good service. The transaction is cash-free, because charges go directly to the credit card the passenger adds to his account. Changes have been made to both Android and iOS apps.

Sidecar used to suggest a donation amount, but passengers were not charged a metered fare like a cab. Sidecar rides can only be booked through the smartphone app — no phone calls or Web bookings — one reason the company has grown so rapidly in cities of high-tech use such as San Francisco.

Sidecar’s transition to required payments is a response to the company’s growth, and the 50 percent jump in applications from perspective drivers in the past two months. With more drivers who want to get paid, the donation model just wasn’t working.

“They’ve also told us loud and clear they would drive more frequently and take longer ride requests if they could reliably depend on fair payment every trip,” said Sunil Paul, Sidecar founder and chief executive officer.

For now, only California passengers will be required to pay the set fares; outside the state, Sidecar will continue to be a donation-based service. Sidecar operates in San Francisco, San Jose, Oakland, Long Beach, Los Angeles and San Diego.

A donation-based model is also tougher now that Sidecar is no longer the rogue startup it once was. After months operating outside transportation regulations, Sidecar and most peer-to-peer transportation companies were recognized by the state in September when the California Public Utilities Commission passed a law that creates a new category of transportation services and allows car service apps to operate legitimately.

Sidecar said on Friday it was the first company to apply for a license under this new transportation category, called the Transportation Network Company. The law requires that companies not only apply for for a license but also comply with vehicle safety inspections, insurance requirements and driver background checks.

 

Image from Sidecar 

Heather Somerville Heather Somerville (222 Posts)

Heather Somerville is a business reporter covering venture capital and startups for the Bay Area News Group.