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Industry News: New Study Reveals Ride-Hailing Services Will Still Be Expensive, Even With Robots


William Maley

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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)


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I like using Uber occasionally when I’m going to dinner or a concert or other event downtown in an area without convenient parking...not something I’d use daily, but a few times a month..

For vacations, I could see using Uber esp. in places where I wouldn't rent a car.  

Edited by Robert Hall
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Equally important is that rideshares are not practical in a lot of small towns and rural America more generally.  I have no need for a rideshare, but I do feel sorry for those who live in the middle of nowhere without a CAR of their own.

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I use Uber/Lyft to get to and from the airport primarily because work won't reimburse mileage for the trip and it is a 60 mile round trip for me which adds up as much as I travel. 

That said... Uber and Lyft aren't all that expensive today even with human drivers. They're cheaper than taxis. 

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They can be extremely convenient. A couple years ago when we went to Vegas, we never needed to rent a vehicle because we were close enough to walk most places but those we couldn't the $10-30 for an Uber/Lyft was way cheaper and even more convenient than finding a place to park and most likely paying to park as well. 

We also use them if we're going out drinking places, no worry of a DUI if you're not driving. 

It's really all about location. When you're in a larger populated area, it's way more convenient to Uber/Lyft then drive a lot of the time. 

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Do not forget Private auto's. Getting from SeaTac airport to my house is a $125 plus tip in a Yellow Cab, $100 plus tip in an Uber / lyft and cheapest is private car, $75 plus tip. I use the private auto's because the cost is so much cheaper over a traditional taxi or messing with the uber / lyft app stuff.

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45 minutes ago, dfelt said:

Do not forget Private auto's. Getting from SeaTac airport to my house is a $125 plus tip in a Yellow Cab, $100 plus tip in an Uber / lyft and cheapest is private car, $75 plus tip. I use the private auto's because the cost is so much cheaper over a traditional taxi or messing with the uber / lyft app stuff.

But once you factor in the cost of parking at the airport (if you leave your vehicle there for several days), then taxi/uber/etc may make more sense. 

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48 minutes ago, dfelt said:

Do not forget Private auto's. Getting from SeaTac airport to my house is a $125 plus tip in a Yellow Cab, $100 plus tip in an Uber / lyft and cheapest is private car, $75 plus tip. I use the private auto's because the cost is so much cheaper over a traditional taxi or messing with the uber / lyft app stuff.

You must live way out there.  I"m 30 miles from the PIT airport and its usually between $50 and $60 dollars one way in Uber/Lyft.

I do it because of the mileage non-reimbursement.... but they'll reimburse me for a Lyft.  It makes no sense, but it's the system I have to work with. 

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9 minutes ago, Robert Hall said:

But once you factor in the cost of parking at the airport (if you leave your vehicle there for several days), then taxi/uber/etc may make more sense. 

Yeah airport parking is insane. Depending how close/far away you are it's $7.00(reasonable) to $30 a day here at Lambert(Just checked). Most seem to be in the $10-$20 range. That sht adds up. 

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58 minutes ago, Drew Dowdell said:

You must live way out there.  I"m 30 miles from the PIT airport and its usually between $50 and $60 dollars one way in Uber/Lyft.

I do it because of the mileage non-reimbursement.... but they'll reimburse me for a Lyft.  It makes no sense, but it's the system I have to work with. 

Takes me 1hr 30 min to get from my house to SeaTac. With the New Pane Field in Everett, now 15 min or less to get from my house to that new airport in Everett.

1 hour ago, Robert Hall said:

But once you factor in the cost of parking at the airport (if you leave your vehicle there for several days), then taxi/uber/etc may make more sense. 

Yes, that is true, just makes more sense to have my wife in the past would drive and we would drop the daughter off at work, then go to the airport and she would drive home. Being a morning person, I always get the first flight out in the morning.

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1 minute ago, dfelt said:

Takes me 1hr 30 min to get from my house to SeaTac. With the New Pane Field in Everett, now 15 min or less to get from my house to that new airport in Everett.

Yes, that is true, just makes more sense to have my wife in the past would drive and we would drop the daughter off at work, then go to the airport and she would drive home. Being a morning person, I always get the first flight out in the morning.

Yeah, like when I lived in Arizona, I would drop my sister off at the airport every Sunday evening/Monday morning and pick her up Thursday evening when she worked out of town for years.   When I lived in Colorado, I would leave a vehicle at DIA sometimes for 2-3 weeks in long term parking when I would go on vacations.    

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7 minutes ago, balthazar said:

It just struck me about the opening pic: that’s a pretty demure outfit for a prostitute. I guess in 2019, they should be able to dress however they see fit/ makes them comfortable rather than how ‘street society’ tells them they have to.

Did I miss the ride hailing service picture with a prostitute on the cover? 🤔

Just saw the pic Bill used. :lol:

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1 hour ago, Drew Dowdell said:

The driver is female too.... Are there Lesbian hookers? Do they hang out at Uhaul stores?

That should be popular then as a 3 some was listed on the dreams of college students for a crazy night of passion.

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