Lyft Line launched Wednesday and is up to 60% cheaper than a normal Lyft ride, the company said.
Lyft Line riders have to share their ride with others going the same way, essentially like carpooling, but it's an alternative to paying a full Lyft fare, driving alone or taking public transit. Commuters getting picked up use the Lyft app to pay. Lyft then pays the driver.
The idea behind Lyft Line is to connect consumers whose daily work commutes correlate with one another, the company said.
"Shared rides along shared routes, priced for daily use," Lyft said in a statement describing the new service. "Simply set your destination, and we'll connect you with a ride already going the same way."
Customers get up to $25 in credit toward their first Lyft Line ride. For now, Lyft Line is available only to Apple iOS users in San Francisco, but Lyft said the service would expand to Android users and other cities.
Uber, meanwhile, said its service, called UberPool, has launched in beta for select San Francisco users and would roll out "more broadly" Aug. 15. UberPool rides are up to 40% cheaper than UberX rides.
Lyft and Uber are hoping their carpool services will attract more daily customers.