Shared Mobility: A Crucial Component of Future Transportation

Giovanni Circella: Our topic today is how technology is changing transportation, and whether we can envision a set of interventions to ensure that transportation continues to meet sustainability goals, particularly California’s greenhouse gas emission reduction targets.

Shared mobility and electric vehicles are already a reality, and autonomous vehicles are almost ready to hit the market. It’s important that we have the discussion now about how this transition will change our lives.

Sarah Ashton: Uber looks at this transition from an environmental perspective, an EV perspective, and a shared mobility perspective. For us, it’s essential to see those three pieces together. At the end of the day, if shared mobility is not a component of this transition, we could still have a pretty significant traffic and environmental issue on our hands. Lots of autonomous vehicles and electric vehicles on the road is still a lot of congestion. We see that sweet spot, where ride-sharing fits in, as really important.

We have pilots in some states to operationalize autonomous vehicles and integrate them onto our platform. We’re also engaging in autonomous tracking, which has a significant environmental impact. Those are the primary spaces that Uber is thinking through right now in terms of autonomous technology.

I also spend a lot of time thinking about how we can work with city and state government on these topics. There are lots of questions around the role of the city, and a lot of disconnect about the role of the state as well.

There are pre-steps that cities can proactively take to prepare for this technology: thinking about curb space usage, repainting lanes, or mapping traffic signals to share that data with companies. We’re also working with states to think about the regulatory framework that could unlock these technologies.

It gets hairier when it comes to the national perspective, such as with cross-state travel. There have been recommendations, but there’s no formal roadmap at this point. This is one reason state leadership is going to be key to the rollout of autonomous vehicles. We’ll need states to work with their neighbors to ensure at least broad consistency for safety sampling.

Giovanni Circella: How do you see the market changing? What does Uber think about the future of mobility, given where we are now and how it’s evolving so quickly? 

Sarah Ashton: Right now, ride-share accounts for just over 2 percent of local rides. There’s huge opportunity now that people are ready for that type of experience. A lot of low-hanging fruit, like college towns and urban cores, has already been captured.

We’ve also crossed over into becoming more of a suburban support structure for transportation. We’re starting to see that more and more rides in Manhattan, for example, actually happen outside of the island of Manhattan. When we’re no longer operating just in dense urban cores, we have to think about how we’re going to integrate with existing mobility structures and link to existing public transportation networks.

We have a number of partnerships looking at this issue. For example: Can we provide first/last-mile solutions in rural communities, especially where the weather is more extreme? We did a pilot in Denver, where first/last-mile problems were concentrated mainly around the rainy season. Or: Can we integrate more significantly into public transit? In L.A., about 30 percent of all our rides begin or end at transit stations—and that’s without much work on our part.

In partnership with Metro and in our own right, we are actively thinking about how to better integrate into existing elements, especially given the flood of investment around transit networks in communities throughout Southern California. Complete transit integration is going to be one of Uber’s largest focuses going forward, and we’re building a strong team internally to work on it.

There are also untouched markets. The elderly community may never have thought about ride-share, but they seek out mobility; they want to be able to go to the grocery store. We’re working with a number of smaller transit groups in Southern California to allow a retirement community to dispatch cars, for example.

Another market is kids. We can’t give rides to kids under 18 years old, according to the California Public Utilities Commission, but a lot of companies are trying to better support parents and help them get their kids from Point A to Point B.

One thing to note is that, in the U.S., we’re focused on cars. But in Brazil we have uberMOTO, and we have a rickshaw service in certain countries. For high-congestion areas, motorcycles or bicycles might actually be a quicker mode of transportation. What on-demand mobility means is different in each country, and that makes this an exciting place to be. 

Daniel Hall: Have you seen a lot of bus routes canceled and replaced with ride-hailing businesses?

Sarah Ashton: A number of very small Southern California transit agencies have approached us about this. It is one of the top inquiries that comes in—I get one or two calls a week from cities asking about it. Agencies are hemorrhaging money on some of these routes, particularly in rural areas. In one case, it cost the agency $20 per person per ride; they were obviously heavily subsidizing that in order to charge a fare of $1.50.

We are still working through how meet this need in a way that meets regulatory requirements. We still need to figure out ADA compliance, for example. We are at the table having those conversations, and we have figured it out in some areas. But it takes a lot of time and very willing policymakers.

Giovanni Circella: To what extent do you think autonomous vehicles will be shared versus individually owned?

Sarah Ashton: You can’t discount how market factors play into people’s decisions around these things. When EVs first came out, everyone was doing “ride and drives” with the goal of getting butts in seats, so that people could experience electric cars. I’m trying to get more EVs on our platform in Southern California so that we can show CARB that this is a value ride-sharing companies can provide—a more modern “ride and drive.” The same goes for AVs. We can start to shift the needle on social position-making.

San Francisco, the first city UberPOOL launched in, now has more POOL rides than single rides. (It’s still under 50 percent in L.A., but not by much.) Five years ago, if you asked people in San Francisco if they would take a POOL over their own Uber, they would have said, “Absolutely not.” It’s a process, and people are slowly getting there.

It does take some work to see that behavior change. When we launch POOL in a new market, there are times when we’ll eat the cost to help get more people in that car. Eventually, it tips the scale. Uber sees the long-term investment in transforming mobility, and we are absolutely willing to take short-term hits in service of that long-term shift. We’re very fortunate that we have the funding to do that; not a lot of other companies could take that hit over and over again. But because we want to move the needle on alternative transportation, we see it as a worthy and wise investment.

I’ll also note that our pricing is different in different cities, and that is because we’re constantly experimenting with what is unique to that city that changes behavior there. In some cities, you sit in traffic more. In other cities, you drive longer distances. These things impact pricing. That has been criticized as an inconsistency, but one reason I chose to work at Uber is because we really look at the communities we’re working within. We don’t just take a one-size-fits-all approach to how things will roll out.

Giovanni Circella: Uber has been testing automation in some pilots. How are these projects going? How do you see them becoming available on the market? 

Sarah Ashton: What’s coming out of Pittsburgh and Arizona is very exciting. Those projects are honing our software and technology, which is still very much in the earlier, internal phases.

We have found that the best places for AV pilots are places where we have a very close working relationship with the state government and, where possible, the city government. Things didn’t go smoothly in San Francisco, and that was an important learning lesson for everyone.

It’s an important part of our growing up as a company to think about how we roll out in cities, and policymakers are also going to have growing pains. That’s why we need to work with states on these issues. It’s going to be a slow and steady process for all of us, and it’s exceptionally important that we have open conversations about these things—because if we don’t, we’ll find ourselves in situations that are not good for the industry as a whole, and that’s ultimately not good for safety.

When we roll out further, I would like us to work directly with the city to make sure that what we have is what they have, and that we are in lockstep. It’s going to take time and partnership. Uber is growing our government affairs and AV policy teams so that we can have boots on the ground to work through these issues.

Giovanni Circella: Who will be responsible for covering the costs of all the infrastructure that needs to be upgraded and maintained for autonomous vehicles? 

Sarah Ashton: I think it’s important for policymakers to look beyond their term limits at how to set up funding for infrastructure for years to come. L.A. has done a good job at that; it is now funding some transportation upgrades in perpetuity with a never-ending tax. There is some interesting leadership in California around this issue.

Giovanni Circella: Research suggests that VMT is going to increase with autonomous vehicles, as traveling by car becomes more pleasant. We’re going to need to ensure that greenhouse gas emissions don’t increase. Certainly, electrification will be part of this, but we’ll also need policies to address this issue. Can we create incentives for sharing rides, for example, or shifting from owning a vehicle to using one when you need it?

Sarah Ashton: Pricing and convenience are the two drivers of decision-making. We’ve seen, for example, that pricing dramatically impacts whether our users ride POOL. The deals we offer on POOL rides—where you buy 20 rides at once for a set price—go so fast, I couldn’t even get one. In the future, we should look at congestion pricing and other pricing schemes to drive the behavior and use of vehicles that we want.

We also need to think about the price of parking infrastructure, and what the value of that land could be if given back to a city. It could be parks, or schools, or the city could sell it. In a city with housing issues, we could be building high-rises on some of that land. Unlocking the real estate that we could reclaim back from parking infrastructure could be transformative.

Some of the heaviest sunk costs cities have are their fleets and the parking infrastructure that they own and operate. One city in New Jersey chose not to build new parking infrastructure, and instead use that money to implement a rideshare voucher program in partnership with us. They deemed that a better use of their resources than building parking infrastructure, because they felt that we are so close to the point when they wouldn’t need it.

Some developers are building garages that can be gutted and quickly turned into an apartment complex as soon as its life as a garage has run out. Of course, we still have short-term needs for parking infrastructure, but if we don’t build flexible infrastructure as much as possible, we’re only locking ourselves further into the problem.