Our Outlook on Ride Shares: Two Possible Futures of Ridesharing

future of ridesharing

Ridesharing is a form of shared mobility where a passenger arranges a shared ride with other riders, like modern day hitch-hiking, usually through the arrangement of a mobile app. Great examples of ride-sharing are Pop Rideshare and Blablacar. Conversely, ride-hailing is another form of shared mobility where a passenger obtains a private ride (sometimes shared with other passengers) by the owner of the vehicle, also with the use of an app, such as Lyft and Uber. This form competes with longstanding taxi services in metropolitan cities. Yet in media and press the term ride sharing is often used to describe ride hailing.

So what’s the future of ridesharing (as in ridehailing)?

Option 1: Carmakers Investing in Ridesharing Tech

ride with via

We’re seeing a lot of carmakers investing in ridesharing tech, which is exactly what’s happening with the latest news in the ridesharing industry. Daimler AG is going to be launching theirs in London in late 2017, which will be an expansion with its cooperation with US startup Via Transportation. This on-demand service based in Amsterdam racks up 1 million rides a month across New York, Chicago and Washington.

Via, working with Daimler since 2015, plans to raise a total of $200 million for the expansion, people familiar with the process said. While Daimler is the lead investor, the parties didn’t disclose a funding amount. Adding to the strategic investment, Daimler’s Mercedes-Benz Vans unit will contribute $50 million to the new partnership.

“On-demand ride-sharing offers many new ways of making city traffic efficient, needs-based and sustainable,” said Volker Mornhinweg, head of Mercedes-Benz Vans. “Via is one of the most successful providers in the growing ride-sharing sector while Mercedes-Benz Vans has the perfect vehicles.”

Carmakers are increasing investments in partnerships with companies offering new services as urban consumers show less interest in owning a car. Toyota Motor Corp. last month invested an undisclosed amount in Grab, Southeast Asia’s leading ride-hailing operator, a year after it bought a small stake in San Francisco-based industry heavyweight Uber Technologies Inc.

The Via service works by connecting multiple passengers who are headed the same way, allowing riders to share a vehicle. It was first offered in New York in 2013. Users request a shared ride through an app, and an algorithm finds a suitable vehicle headed in the same direction, reducing detours.

Combining Via’s technology with Mercedes-Benz Vans was “ideal for our vision of offering efficient, affordable, sustainable, and convenient shared rides everywhere,” Via Chief Executive Officer Daniel Ramot said in the statement. Read the full article here.

option 2: non-profit ridesharing

ride austin ridesharing

Though partnerships such as Via and Daimler make headlines in media, there’s another option for the future of ridesharing: and it’s not for profit. Austin, Texas provides this example of the possible future of ridesharing. Unlike Uber, RideAustin is the city’s non-profit rideshare. It charges $2 off the top, and the driver keeps the entire fare — including tip. Apparently, this isn’t a model Uber can compete with, even though rides are competitively priced.

The benefit? The approach gives municipalities all the control to operate a safe and efficient service, while minimizing financial incentive and providing drivers with a stable, and competitive, income. Cities also have the ability to run the program as they see fit, including regulating the number of drivers on the road, safety and licensing requirements for said drivers, and ensuring quality of service for all those that use it.

Read more about this alternative to ridesharing here.

Curious to learn more about ridesharing? Contact us for our information offerings.

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