Transportation consultant Joe Sulmona is looking at the impact of ‘Transportation Network Companies’ (TNC) like Uber.
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While mass transit will remain valid in various corridors for primarily historical investment reasons, on-demand automobile-based services, especially when automated, will make the public transit monopoly harder and harder to support. The TNC economics of cherry-picking high-value routes that generate significant profits now for public transit to offset loss making routes needs early attention by all urban leaders. As before, what is needed in Metro Vancouver is a thorough public policy debate involving both civic and provincial leaders to discuss what kind of transportation network may emerge with new TNC and automated systems – time is now for this debate.
BTW, the evolution of TNC will also mean the potential to enter other urban transportation markets, so why is the Canada Post monopoly for first class mail in urban areas remain valid. If the public is willing to trust TNC with passenger services, without the existing regulatory safeguards, why should moving mail (and increasingly only the junk variety) have a dedicated and expensive delivery system.
Again, I challenge all to pursue with community leaders the need for a forward looking debate on our transportation system, and challenge the status quo everywhere, and not just the current issue around taxi services.
Dr. Joe Sulmona
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While with caution it must be noted the following survey (below) was commissioned by a Toronto taxi operator, the observations are consistent with my previous blog that Transportation Network Companies (TNC) will completely re-shape for-hire urban transportation services, including the way we see public transit.
Transmitted by CNW Group on : September 25, 2015 07:11
Poll suggests UberX is decreasing TTC and GO transit ridership
TORONTO, Sept. 25, 2015 /CNW/ – About one-third (32 per cent) of Toronto UberX users who also use public transit say that they’ve decreased their usage of TTC or GO Transit since they started using UberX.
“Toronto’s taxi industry is constantly being pitted against UberX as if we’re the only ones that should be worried about a black-market for-hire vehicle service,” said Kristine Hubbard, Operations Manager at Beck Taxi. “Our city needs to take a moment of pause to consider how the TTC and GO Transit could be negatively affected by the continued growth of a black-market taxi service.”
A survey conducted by Harris Poll on behalf of Beck Taxi also found that among respondents who use UberX and also use public transit, one-fourth (25 per cent) of them expect their public transit usage will decline because of UberX in the next six months.
“Toronto’s transit champions should ask themselves what we need to do to protect the future of public transit,” said Hubbard. “It’s disconcerting to hear that anyone is willing to deregulate transit and possibly put the TTC and investments in transit at risk. What will happen when Uber decides to provide cheaper transit services on popular TTC routes?”
In recent months, Uber has been trialing a “smart routes” service in San Francisco that has been compared to a bus service in media reports. The service discourages transit use by attracting Uber customers to travel along specific routes like a bus, for a competitive price.
Toronto has the highest number of taxis per capita compared to any other city in North America. In order to protect and strengthen public transit in Toronto, Beck is calling on councillors to think carefully about allowing an unlimited number of UberX cars on Toronto’s shared roads.
Research:
The survey was conducted online by Harris Poll on behalf of Beck Taxi among 702 adult residents of Toronto familiar with Uber, of whom 116 use UberX and public transit, from Sept. 4 to Sept. 10, 2015. The survey data are not weighted and therefore representative only of those surveyed.
About Beck:
Beck is a family-run business that has operated in Toronto for 49 years.
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UPDATE: Joe adds this example:
Real changes are happening out there, and this DC service has mirror in the UBER-Pool product.
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Metro Vancouver is way behind with too much focus on protecting monopoly for conventional transit.
This is indeed a debate worth having. As we see from the various responses of cities to Uber it will take many forms.
Looking at the success of Car2Go or now, Evo over the last few months even, public transit and individual car ownership will be affected. Speaking from personal experience, I use the car and certainly the public bus a lot less since Car2Go came on the market, and now I use Evo more as it provides superior driving for the same price. Car2Go’s answer: B class Mercedes at the same price of the Smart car – carrying up to for 5 people. Translink’s answer: huh ?
Overpaid (usually unionized) bus drivers and other transit services personell (such as $100,000+ transit cops, customer service agents or managers) ought to be very worried as private firms enter this space with far more nimble and market oriented services.
High capacity buses or rapid transit will continue to make sense whereas slower buses, low density neighborhood buses or low demand off-peak-hour public transit will be the first to be affected. Many low density, sparse bus routes today could benefit with an Uber-enabled service, especially in off-hours. Think Uber+TransLink as opposed to TransLink vs. Uber !
One person’s “black market taxi service” (to quote the article) is another person’s solution to waiting 30 minutes in the rain or to have no service at midnight.
Ditto, the taxi industry with ancient licensing requirements and month-long learning needs a major re-boot in the age of SmartPhones, Uber, Google Maps and soon, driverless vehicles.
I find it courious, sad really, that it is often the same politicians that want to allow a large number of refugees or uneducated immigrants into this country, that also restrict jobs for these new arrivals that could, for example, work as UberX drivers and make cash almost immediately with little or no English skills.
Syrian refugee working as UberX driver makes $5/h.
Pakistani or East-Indian cab driver makes $15/h driving a cab.
White (usually male) bus driver makes $45/h (counting all benefits).
No wonder the winds of change are blowing so hard, and are resisted by certain groups vehemently !!
This is really troubling, and I’m glad they include it:
“The survey was conducted online by Harris Poll on behalf of Beck Taxi..”
My guess is that not a lot of people commute by taxi/Uber. I would instead believe that Uber might be stealing a few riders from mass transit during off-peak hours in the rain when the bus sometimes only comes every 30 minutes.
Seems you could replace the word “Uber” with “walking” and use the exact same arguments.
Walking puts our public transit infrastructure at risk! Walking disrupts good paying union taxi jobs! Walkers don’t pay enough tax! Stop selfish, private walkers from cheating the system!
Walking puts public safety at risk!
Jitneys certainly did play a role in destroying the viability of streetcar systems of the 1920s. How big that role was and whether that situation will repeat itself is certainly worthy of debate.
I remember taking a taxi home one day when it was an “emergency”. It cost $22 and I arrived 10 minutes earlier than usual. The bus would’ve been $2.10.
Is it reasonable to spend $40/day to save 20 or even 30 minutes? Not on your life.
Will Uber be able to undercut the existing taxi system enough to make it practical for commuting? Unlikely.
And if they do will anyone be able to make a living as a driver?
How is Thomas’ hypothetical Syrian refugee going to be able to afford a car on just $5/hour? And where will (s)he find a place to live west of Hope on such wages?
Huh?
“The TNC economics of cherry-picking high-value routes that generate significant profits now for public transit”
This seems to me like it’s the exact opposite of TNC economics. Transit users who also use Uber may be reducing their use of transit, but I find it doubtful that it’s for trips on high-value transit routes. Those are the routes where transit often outperforms private vehicles thanks to dedicated right of ways and frequent departures. I am refusing to use Uber until proper insurance is available (and required) for their drivers, but the trips that I would replace would be the awkward ones that involve an infrequent service.
Uber is complementary to transit for those who can afford it, so it is a danger to “transit-as-a-social-service” routes, but isn’t going to replace transit on high ridership routes where transit can operate efficiently.