There has been a prevailing thought about the likes of Uber and Lyft that once they switch from human drivers to self-driving vehicles, they would stand to see a significant reduction in overall operating costs. This possibly means consumers could see these services as an alternative to owning a vehicle. But a new study from the Massachusetts Institute of Technology (MIT) disputes that claim.
Researchers Ashley Nunes and Kristen D. Hernandez examined the San Francisco market on the per-mile cost of an automated taxi service to owning a vehicle. They found an automated taxi would range between $1.58 and $6.01 per mile, while the conventional vehicle would be at $0.72 per mile.
"When we started going into this work, we found there's a lot of hand-waving. There was a notion that 'All we have to do is remove the driver, assume a reduction in insurance, and there's our great number.' We said, 'Let's hold it up to scrutiny.' It didn't hold up," explained Nunes to Automotive News.
The massive disparity gap isn't due to ownership or maintenance, rather a fundamental issue about the taxi market in general. Nunes said taxi operators drive too many miles without a paying customer - hence their higher costs. In San Francisco, the MIT researchers found a 52 percent utilization rate for ride-hailing. Even if they were able to reach 100 percent utilization, Nunes said they would still be "unable to provide a fare that's comparable to car ownership."
"Their approach with the investment folks has been, 'Trust us, we'll figure this out and it'll be this great utopia where everyone is jumping from an Uber to a scooter to an air taxi.The future may well be all those things. But you need to demonstrate you can offer the service at a price point that consumers are willing and able to pay. Thus far, they are unable to do so," said Nunes.
Source: Automotive News (Subscription Required)