A new driver-owned rideshare cooperative is now planning to launch operations in Minneapolis after Lyft and Uber threatened to exit the state following the passing of a minimum wage law.
The Driver's Cooperative is aiming to launch a rideshare platform in Minneapolis before the start of May. The platform will be made in partnership with the Minnesota Uber/Lyft Drivers Association, according to CBS News.
The Driver's Cooperative was founded in New York City in 2021 and touts itself as the world's first driver-owned rideshare platform. Members of cooperatives make 8% to 10% more on each trip they make compared to those driving for Lyft and Uber, according to the website. Any profits made are then returned to its drivers as dividends.
Since its launch, over 12,000 drivers have joined the cooperative.
"Drivers make more on each trip, all profits go back to drivers, and drivers have democratic control over the decisions that affect their lives. Our mission is to end exploitative conditions in the for-hire vehicle industry through system change- putting drivers in the driver's seat of the platform economy," the company wrote on its website.
Behind Lyft and Uber's Exit
The Driver's Cooperative's move into the Minneapolis market comes after Lyft and Uber this month announced they will stop operating in the city beginning May 1. Those plans were in response to the city council's passing of a new minimum wage law that required rideshare drivers to be paid at least $1.40 per mile and $0.51 per minute for each trip to ensure they earn $15.57 per hour, which is the local minimum wage.
Uber and Lyft argued that the new ordinance would result in drivers earning less and riders potentially paying more for each trip to cover the increased operating costs.
"We're leaving Minneapolis. Despite our efforts and your support, the Minneapolis City Council passed an ordinance that would make rides on the Lyft platform unaffordable for the majority of Minneapolis residents. This drastic drop in rides means the thousands of drivers who rely on the platform for earnings will ultimately earn less, creating an unsustainable situation for our customers," Lyft said.
Since Uber and Lyft's announcements, other rideshare companies have floated the idea of operating in Minneapolis, including Wridz, Empower, and Pikkap.
READ MORE: Uber, Lyft To Leave Minneapolis Following New Minimum Wage Law
