Uber, Sidecar, and Lyft Are Great Options, But They Are Not Ridesharing Companies

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Jason is a transportation expert for Pavluchuk & Associates and lobbyist for the Association for Commuter Transportation.
March 18, 2014

Rideshare

People love new transportation technologies like Uber, Sidecar, and Lyft that are allowing them to get on their smartphones to quickly and conveniently hail a ride.

But with that ease of use, there are several murky areas that could in the end negatively affect the public.

Public and non-profit ridesharing or commuter-services programs all across the country have been part of the national transportation program for decades and depend on federal and local funding for the sake of the public good. For all these years, ridesharing has been defined as: people sharing rides to their destinations through organized carpool and vanpool programs whose users typically share the costs of those rides. They also tend to, by extension, promote public transit, biking, walking, and other congestion-reducing modes of travel.

The innovation happening in transportation now is exciting, but companies such as UberX, Lyft, and Sidecar that are calling themselves, or being labeled by the media as,“ridesharing” is causing negative repercussions for the true ridesharing programs.

First, because these companies provide services similar to taxis, wherein drivers are working for profit rather than simply seeking a contribution towards the driving expenses, many local and state governments are  considering regulating “ridesharing” somewhat like taxis. The unintended consequences of such regulations could be to make carpooling and vanpooling by individuals virtually illegal or unfeasible because of higher insurance requirements or background checks.

Second, members of Congress are confusing the new profit-making ventures, which often have extensive private funding, with the long-standing public-purpose ridesharing agencies and threatening to cut public funds for all ridesharing.

Both of these actions could bring down the whole national ridesharing system, cutting hundreds of local agencies and affecting millions of commuters.

A battle is playing out across the country between the taxi industry and these new ventures, which the California Public Utility Commission recently defined as “transportation network companies.” It is a complicated issue in which the public-purpose ridesharing/commuter-services industry would prefer not to be embroiled. Nevertheless, it is precipitating regulations all over the country that could unintentionally have negative consequences for the ridesharing industry if the definition of ridesharing is not clarified appropriately.

If these companies receive the legislative designation under the current ridesharing laws, taxis (and even other businesses or individuals) may seek to become dangerous and unregulated travel options, drivers with personal rather than commercial insurance at companies like UberX could have the consequence of raising everybody else’s auto insurance, and the fear of whose car you are entering when using these services could become much more serious.

The Association for Commuter Transportation (ACT) is dedicated to expanding options for commuters. We understand the value of the services these companies provide, but we are also determined to defend traditional ridesharing. ACT has weighed in on several instances in which state or local governments are working to regulate this new class of mobility options.

The point ACT makes is simple, do not define these new companies as ridesharing, and in the development of new regulations, specifically exempt ridesharing. ACT has expressed it is willing to work with these new mobility companies on research to identify the public good associated with their services. From this, lower forms of regulation or exemptions might be derived.

In Arlington County, Virginia, county officials have heard that UberX drivers, in particular, are not familiar with the area, suggesting that they are coming from other places to work their shifts. Further, a proliferation of unregulated vehicles plus the need for regulated taxicab drivers to work longer hours in the more competitive environment may actually be increasing rather than reducing overall driving trips (hence, doing little to relieve traffic congestion) even while they may limit the need for a personal car for some individuals.

Mobility Public Policy Summit Save the Date Card FINAL HI RES

Mobility Lab will be examining these issues leading up to a conference it is co-sponsoring with ACT, TransitCenter, and UCBerkeley Transportation Sustainability Research Center called the Innovation in Mobility Public Policy Summit.

Photo by BlaBlaCar

{ 7 comments… read them below or add one }

avatar Alan March 18, 2014 at 10:53 PM

Thanks Jason for this clear analysis. Traditional ridesharing is where a driver picks up riders on a route that she was already planning to travel, and collects from the rider a fee which does not exceed her own expenses. The transportation network companies (TNCs) are an alternative to taxis, where drivers are making rider-directed trips for the purpose of earning income (and collecting fistbumps). These new alt-taxi services provide car owners with opportunity to be mirco-entrepreneurs and should be encouraged to expand within the limits of a sensible regulatory policy. The environmental and social benefits of traditional ridesharing (and the financial support it receives) should not be negatively impacted by these innovators.

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avatar Odile Beniflah March 19, 2014 at 10:54 AM

Thank you Jason: best post I have read on this issue so far!
It is unbelievable that public-purpose ridesharing agencies have been left in the shadow for so long and that the debate on ridesharing has been solely focused on a few tech startups. Looking forward to a national debate on how to best promote ridesharing in America.

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avatar reallytired12 March 20, 2014 at 9:56 AM

There wouldn’t be this proliferation of options IF the traditional ridesharing were working. In my city, public transport has cut commuter routes, the routes remaining — I can’t figure out who they are servicing — the routes don’t go to businesses, churches, or schools – so the buses are running nearly empty. What a waste. The public transport systems need a new way to look at how they fulfill rides or else they won’t be around — much like a dinosaur. There is a way to have people tell companies where they want to be picked up, dropped off, time and payment in an application. The people will tell where the routes need to be and will pay based on that convenience.

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avatar Laure Wagner March 21, 2014 at 11:13 AM

Hey Jason,

Thanks for clarifying the vocabulary for those who ignored the difference between real ridesharing (sharing real costs) and car on demand that is a paying service. Very useful and hope that the confusion won’t have negative impact on real ridesharing compagny like us, BlaBlaCar. FYI we have more than 6 million members and 1 million members share their cost of their trip everymonth thanks to BlaBlaCar. We are growing very fast, 100% per year and are backed by Accel partners. Europeans mainly use BlaBlaCar to share long distance trip on weekends.

By the way can you modify the copyright of the image because it belongs to BlaBlaCar :-) We took it last year, the girl’s name is Mathilde and here is her profil :
http://www.blablacar.fr/membre/profil/9eF1ILpy5oCqzkewVBagMQ
Our picture is free to use but can you just display BlaBlaCar instead of Motorblog.
thanks !
Laure

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avatar Paul Mackie March 24, 2014 at 10:05 AM

Fixed the photo credit, Laure. Thanks for letting us know. And good work!

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avatar Marty March 26, 2014 at 2:01 PM

Great post.
They are all great services addressing the taxi market which needs to be disrupted. However, those companies hire drivers for shift work and the average trips are under 4 miles.
Companies mentioned above like Carpooling and BlaBlaCar in Europe as well as RidePost.com here in the US are filling a much different and important market. There should be more understanding in the media of the difference between getting a taxi ride for 4 miles and sharing transportation costs when traveling 50-500 miles.
Thanks!

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avatar fogyókúrás tabletta October 21, 2014 at 9:36 PM

Very great post. I will be subscribing for your feed!

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