lyft

The Texas ride-hailing startup Alto hopes to give tech giants like Uber and Lyft some stiff competition in Southern California with an employee model and a slew of safety measures — from masks to HEPA cabin air filters.

The company launched its app in Los Angeles on Tuesday at a time when the pandemic has hurt ride-hailing services' bottom lines and employee relations remain frayed by a spat over working conditions.

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Uber, Lyft and other ride-hailing and delivery companies won their bid to keep drivers as independent contractors in what became the most expensive initiative in California history, with $200 million spent and led by the app-based services.

The initiative won decisively with 58% of the vote in a test for the tech-driven "gig economy" that is central to ride-hailing companies business model.

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Less than two weeks ahead of the election, Uber and Lyft are hitting new roadblocks after pouring money into a ballot measure intended to protect their business model.

On Thursday, a California appeals court put that strategy into question when it upheld an earlier ruling that the ride-hailing companies must classify their workers as employees instead of independent contractors. The court ruling won't take effect for 30 days, adding even more pressure on the ride-hailing companies' Proposition 22.

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