You can be on Entrepreneur’s cover!

Uber and Lyft Are Leaving a Major U.S. Metro After City Council Bumps Up Drivers' Minimum Wage The rideshare companies plan to leave Minneapolis on May 1.

By Emily Rella

entrepreneur daily

It might be more difficult to get around Minneapolis after Lyft and Uber say they are ready to exit the city.

On Thursday, the Minneapolis City Council voted to increase driver wages to the local minimum wage for the city, which is $15.57 per hour.

But that was too much for the ride-share companies, which are now threatening to leave the city due to the new minimum wage implementation which will force them to pay drivers a flat fee.

The decision comes after the City Council voted 10 to 3 to override a veto by the city's mayor to instate a pay raise ordinance for drivers in the city.

"It should be done in an honest way that keeps the service affordable for riders," Lyft said in a statement. "This ordinance makes our operations unsustainable, and as a result, we are shutting down operations in Minneapolis when the law takes effect on May 1."

Related: Lyft Becomes First Rideshare Company to Implement Minimum Pay For Drivers

Uber issued a similar statement provided to local outlet Fox 9.

"We are disappointed the Council chose to ignore the data and kick Uber out of the Twin Cities, putting 10,000 people out of work and leaving many stranded," the company said. "But we know that by working together with all stakeholders - drivers, riders and state leaders - we can achieve comprehensive statewide legislation that guarantees drivers a fair minimum wage, protects their independence and keeps rideshare affordable."

Related: DoorDash, Uber Eats Adding New Fees in NYC to Offset Costs

Last month, Lyft became the first ride-share app to implement minimum pay for drivers by guaranteeing that drivers would take home a minimum of 70% of what riders pay, regardless of external fees.

"We think hopefully it will get more drivers driving for Lyft, but also just make the whole sector stronger," Lyft CEO David Risher told Reuters at the time. "We have more drivers now than we've had, I think, since the middle of 2019. It's strong and I tell you what, it's getting even stronger."

If Uber leaves Minneapolis, it will make the city the only U.S. metro area without Uber in the country.

Uber was up a whopping 140% year over year upon the news as of Friday morning. Lyft was up over 93% for the same period at the same time.

Emily Rella

Entrepreneur Staff

Senior News Writer

Emily Rella is a Senior News Writer at Entrepreneur.com. Previously, she was an editor at Verizon Media. Her coverage spans features, business, lifestyle, tech, entertainment, and lifestyle. She is a 2015 graduate of Boston College and a Ridgefield, CT native. Find her on Twitter at @EmilyKRella.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Side Hustle

This Dad Started a Side Hustle to Save for His Daughter's College Fund — Then It Earned $1 Million and Caught Apple's Attention

In 2015, Greg Kerr, now owner of Alchemy Merch, was working as musician when he noticed a lucrative opportunity.

Business News

This One Word Is a Giveaway That You Used ChatGPT to Write an Email, According to an Expert

"Delve" has increased its presence in written work since ChatGPT entered the scene.

Business News

Yes, You Can Buy a Foldable Tiny Home on Amazon — And Now It's Selling for Less Than $12,000

The waterproof and flameproof house was listed around $35,000 a few months ago.

Starting a Business

4 Common Mistakes That Will Spell Doom Your Ecommerce Business

It's hard to spot a success story before it happens, yet it's easy to tell if a business will struggle. With that in mind, here are the four most common mistakes people make that you should avoid when starting an ecommerce business.

Side Hustle

This Insurance Agent Started a Side Hustle Inspired By Nostalgia for His Home State — Now It Earns Nearly $40,000 a Month

After moving to New York City, Danny Trejo started a business to stay in touch with his roots — literally.