Ride Sharing Usage

I have been reading a lot about the efficacy of ride sharing – remember when Uber first started, they were all about sharing the ride to work or a particular destination. For example, this is what my mum used to do for school runs with other mums in the area, each week one mum would pick up other kids and take them to the same school. That was what Uber was originally intended for – if you lived in suburb “A” and worked in suburb “B”, then you could reduce the usage of your car by hitching a ride with someone else doing the same thing.

Then it morphed into a taxi service where drivers registered as a contractor and started to pick up passengers. This naturally upset the taxi industry as they were regulated and the ride share drivers weren’t. Subsequently the taxi drivers, who in some cities had paid thousands of dollars for a licence, started losing fares and their income.

That conflict came to a head with some local Governments banning Uber drivers and some rolling over and allowing them to trade – with hefty tax payer funded paybacks to the taxi drivers. However, in some cities like London, Uber lost its private hire operators licence last year due to safety concerns, although a week or so ago it was granted a 15 month licence to continue. Apparently they have 40,000 registered drivers in the city!

Interestingly it was in the same city that some drivers protested as they were demanding better rates, working conditions and benefits claiming that as their work for Uber was their only income, they should be classed as full time employees rather than contractors. This same argument is now spreading to other companies involved in the “gig” economy such as Deliveroo.

There is another issue that is starting to get legs – and more awareness is happening: the actual amount of true ride sharing that is going on. A new term has come into ride sharing language – possibly from the taxi industry: “deadheading”. That is the term for ride sharing drivers rolling around a city empty looking for work. Citylab.com was quoted in April as saying that in San Francisco approximately 20% of journeys were deadheads. The same article also said that in New York that rises to 50%. Other reports say that in Denver and Dallas Fort Worth it is even higher – at 60%!

That contributes to the problem that the ride sharing companies are claiming they are trying to fix – reducing cars on the road and therefore, the pollution. As some commentators are reminding us, it is not the volume of cars owned that is the problem – it is the usage of them, and if many of the miles driven are wasted, that means two things:

1. Pollution is probably not being reduced by ride sharing services.
2. Many ride share drivers have higher costs than income – and that will become unsustainable at some point.

The founders of Lyft have been quoted as saying: “The under-utilisation of personal vehicles – the average car is used just four percent of the time – is the heart of our transportation problem”. This is completely wrong – the under-utilisation of cars does not cause traffic congestion. However, deadheading does cause congestion and is a waste of fuel, not to mention the increased costs of wear and tear on the ride share vehicle and the road systems.

If you take a journey in a ride share vehicle instead of your own, the same distance will be travelled by a car. Similarly, if you sell your car and use a ride share then the same distance would be covered. However, if you take your car and there is another ride share car deadheading, then twice the distance is being covered. This leads to the other battle that ride sharing companies have – with the vehicle manufacturers, who want people to buy and use their cars and who are hedging their bets by collaborating with (or buying) ride share companies.

I suspect that deadheading will reduce the volume of ride share drivers before private car purchases really drop off the scale. There is more to this topic that will get discussed over the next year, I’m sure.