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1 Disruptive Innovations in Ridesharing: Overview of its History and Recent Trends in Real Time Ridematching April 7, 203 Susan Shaheen, Ph.D. Associate Adjunct Professor and Co Director of TSRC University of California, Berkeley Presentation Overview Problem/motivation Background and definitions History of ridesharing Recent developments Key questions from CPUC workshop Factors to consider
2 Problem / Motivation Estimated effects of traffic congestion in the U.S. in 20 (TTI, 202): Emissions: Additional 56 billion lbs CO 2 emitted Fossil fuel use: 2.9 billion gallons of fuel wasted Efficiency: 5.5 billion hours of extra time Cost of delay and fuel: $2 billion (in 20 U.S. dollars) Background Ridesharing a powerful strategy to address problems of congestion, emissions, and fossil fuel dependency Simple concept: fill empty seats, use vehicle occupancy potential, reduce vehicles on roadway Second largest travel mode in U.S. at 0.7% (ACS, 2008) Distinction from taxis/limos Driver s motivation not for profit (i.e., partially cover driver s cost) Passenger has common origin/destination to driver 2
3 Definitions Some existing definitions for ridesharing: Arrangement between persons with a common destination, or destinations, within the same proximity, to share the use of a motor vehicle on a recurring basis for round trip transportation to or from their place of employment or other common destination. (Florida Regulations ) Transportation of persons between home and work locations or of persons having a common work related trip purpose in a vehicle.this exemption does not apply if the primary purpose for the transportation of those persons is to make a profit. (California PUC Section 5353(h)) Common forms of ridesharing: Carpooling: Grouping of travelers into a private automobile Vanpooling: Typically commuters traveling to/from a common employment center sharing a ride in a van Commercial/for hire transportation: Typically own and manage their own fleet, employ their own drivers Taxicabs: Operate without prearrangement, hail at the curb Charter party carriers (e.g., limousine companies): Trips are prearranged History of North American Ridesharing Phase : WWII Car Sharing Clubs ( ) Phase 2: Major Responses to Energy Crises (late 960s 980) Phase 3: Early Organized Ridesharing Schemes ( ) Phase 4: Reliable Ridesharing Systems ( ) Phase 5: Technology Enabled Ridematching (2004 present) 3
4 Phase : WWII Car Sharing Clubs 942 U.S. Office of Civilian Defense regulation Required ridesharing to workplaces when no other alt. transportation means available Save on gasoline and rubber for the war effort 4
5 Phase 2: Major Responses to Energy Crises Late 960s: Employers hand matched employees with neighbors, distributed personalized match lists Arab Oil Embargo: Shift from parking supply to energy conservation Various federal policies: 974 Emergency Highway Energy Conservation Act 975 FHWA ridesharing guidebooks 979 USDOT National Ride Sharing Demonstration Program HOV lanes, casual carpooling ( slugging ), park and ride facilities, vanpooling 5
6 Phase 3: Early Organized Ridesharing Schemes Employer Based Trip Reduction (EBTR) programs Mandatory programs to combat congestion in suburban office parks Example: Pleasanton, CA TRO, 984 Air quality districts followed Example: SCAQMD Regulation XV, 987 Unclear definition of problem and unrealistic targets Telephone Based Ridematching Pilot telephone based studies Smart Travelers of 990s High cost, low use Commuter resistance/misunderstanding of telephone based, one time matching Internet & E mail enhancements More participation, form basis of ridesharing programs today Phase 4: Reliable Ridesharing Systems Commuters with reliable trip schedules Reliable = Commuters with regular, reliable trip schedules Private software companies began developing ridematching platforms Initial Online Ridematching Prearrangement needed 6
7 Phase 5: Technology Enabled Ridematching Automated ridematching on online websites 4 key developments: Partnerships between ridematching software companies and regions/large employers Financial incentives for green trips Social networking Real time ridesharing 638 North American Ridematching Services (July 20) carpooling 53 vanpooling 40 7
8 Real Time Ridematching Services Match drivers and passengers, based on destination, through a smartphone app before the trip is to take place Typically short, in city trips Cashless payment through app, credit card on file Participants use rating system Differ from dispatch or e hail models that do not require a destination Recent Controversy Startups assert they are not transportation companies, but tech companies that provide ridematching platform Drivers do not need to have commercial license, if they fall under ridesharing exemption of commercial transportation regulations Ridesharing exemption = no governmental regulation of safety and insurance that taxi/limo companies must follow Do startups fall under ridesharing definition? Are their drivers not for profit? Are the shared trips already along the driver s route? Is it more like p2p taxis? 8
9 Aug: CPUC cease anddesist orders for Lyft, Sidecar, and Tickengo Recent Developments Dec: CPUC begins Order Instituting Rulemaking (OIR) to better regulate new companies Feb: Sidecar expands to Austin (acquires Heyride), Philly, LA; UBERx launches Feb: UBERx launches in SF Feb: Austin cease and desist for Sidecar; Philly impounds 3 Sidecar vehicles Apr: SFO cease and desist for Lyft, Sidecar, Tickengo, InstantCab, UBER Apr: Study suggests SF add 600 to 800 more taxis Apr: Lyft expands to Seattle Nov: PUC imposes $20,000 fine for Lyft, Sidecar, and UBER Nov: Sidecar expands to Seattle Jan: Lyft and UBER enter interim agreements with CPUC to continue operations during OIR process Jan: Lyft expands to LA Mar: Lyft acquires Cherry Mar: Sidecar expands to Boston, Brooklyn, Chicago, and DC Mar: Sidecar and UBERx give free rides, and Lyft does publicity at SXSW in Austin CPUC Order Instituting Rulemaking OIR intended to create regulations to protect public safety and promote innovation in passenger transportation Feb 203: Prehearing conference to determine all parties impacted and involved, discuss scope of rulemaking, and plan workshops Apr 203: Participatory workshops to draft report for Administrative Law Judge s review and decision Clarified each party s position Discussed issues of jurisdiction, safety, insurance, competition, and innovation Posed possible regulatory responses to new online enabled transportation services 9
10 Key Questions from Workshop Do InstantCab, Lyft, SideCar, and UBERx fall under ridesharing? Should a monetary cap be imposed on amount drivers can earn? What new regulations should be enacted? Should there even be new regulations? Mar 203: FTC showed concern to Colorado PUC; may impair competition in passenger vehicle transportation services. Recommended a regulatory framework flexible to accommodate new app based transportation services Safety: Are companies checks adequate? Regulations needed for standardization and oversight? Licensing: Should there be a new licensing model for privately owned vehicles (or community drivers )? Insurance: Some have excess liability insurance, but what are the details? Should proprietary information be disclosed to the public? Do these companies add or remove vehicles, add or reduce emissions? Factors to Consider Popularity: Services are filling some need previously unmet Social Dimension: Appeal of social media and peer to peer services Scalability: Reliability requires critical mass E.g., public bikesharing s potential realized with scale and reliability Evolution: Real time ridematching may function differently as it grows Could community drivers enable more real time ridesharing in the future? Need framework to categorize spectrum of services (e.g., ranging from ridematching to dispatching, accounting for profit potential and real time nature) What is best way to encourage innovation (e.g., shut it down, constrain it, or promote minimal level of safety)? Research needed into safety, economic impacts, congestion relief, and emission reduction potential 0
11 Reference
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