professor graham currie the uber verdict

The Uber Verdict technology, transport and cities

Professor Graham Currie Public Transport Research Group Institute of Transport Studies Monash University, Australia Shared and App Based Transport Innovation Seminar Melbourne Town Hall 15th June 2015

1.  Introduction 2.  UberX 3.  Taxis in a Dry Climate 4.  Why Regulate? 5.  Assessment 6.  Futures

Agenda

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This paper explores the good/ bad of UberX with a view to guiding future urban transport policy §  UberX - highly popular, innovative expanding new urban mobility option §  Taxi Industry/ State Government - UberX is ‘illegal’/ against regulations

§  This presentation seeks to understand all sides of the UberX debate to seek a balanced approach to future transport

§  Acknowledgements: major inputs from –  Those that responded to my post on Uber issues at the ITS

(Monash) LinkedIn social media site –  Final Year Transport Engineering students at Monash who ran the

following research projects: •  Andrew Chan – The Impact of Uber in Australia •  Liam Harris – Can uberX surge pricing help solve ride shortages?

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It is structured as follows

Why Regulate? Assessment UberX Futures Taxis in a Dry

Climate

Agenda 1.  Introduction 2.  UberX 3.  Taxis in a Dry Climate 4.  Why Regulate? 5.  Assessment 6.  Futures

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UberX is a smartphone app that lets consumers submit trip requests to crowd sourced taxi drivers

UberX

•  Founded SF 2009 - Started in Australia (Sydney Oct 2012)

•  Very user friendly mobile location App •  Generally cheaper than conventional

taxis •  Users can provide feedback on

individual drivers used

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It has many innovative features including user driver ratings and…

UberX





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…surge pricing - to improve supply in the peaks

UberX





Source: Harris L and Currie G (2015) Surge and Rescue: Can UberX surge pricing help solve ride shortages

UberX Surge Pricing - Melbourne

Because uberX is digital/spatial some spectacular analytics are possible Taxi e-hails in New York City

Source: Uber Newsroom (2015) Source: t.Uber.com

uberX partner earning

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UberX growth has been impressive…

Source: Pocketbook, 2015

UberX Drivers Since Launch – US Cities

Uber Share of Australian Taxi Transactions

Source: Thompson, D 2015

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…but it has been a catalyst to significant service decline in the taxi industry

Source: Pocketbook, 2015

UberX Drivers Since Launch – US Cities

Uber Share of Australian Taxi Transactions

Source: Thompson, D 2015

Figure 3 - Average Trips per Taxi in San Francisco between January 2012and July 2014

Averagetrips

Source: Kwong, 2014

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Authorities consider uberX counter to regulatory controls and uberX drivers are being fined

UberX drivers hauled through the courts, as Uber appeals to public for support

Sydney Morning Herald 15-03-2015

Uber drivers face criminal charges

Australian Financial Review 6-02-2015

Victoria government issues $1700 fines to Uber ride-sharing drivers

Sydney Morning Herald 8-04-2015

Uber drivers slapped with more charges after ignoring orders

WA News Today 26-04-2015

Agenda 1.  Introduction 2.  UberX 3.  Taxis in a Dry Climate 4.  Why Regulate? 5.  Assessment 6.  Futures

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Australian cities are a very “dry climate” for taxis…

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…they represent the lowest density cities for demand…

102

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0 20 40 60 80 100 120

New York

Tokyo

Chicago

Singapore

Hong Kong

London

San Francisco

Paris

Berlin

Sydney

Melbourne

Brisbane

Urban Density

People per Hectare

Cou

ntry

Source: The Economist - Submission to the VCEC Inquiry into Managing Transport Congestion (2006)

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…and also the largest taxi operating areas in the world

Source: Charting Transport

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Taxi demand is highly peaked and also involves long distances and demand lows

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Source: Harris L and Currie G (2015) Surge and Rescue: Can UberX surge pricing help solve ride shortages

UberX Surge Pricing - Melbourne


Agenda

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Taxi regulation balances fares/the number of cabs for commercial viability against agreed service standards

Industry Protections •  Set fare levels •  Limitation on supply

of cabs

Commercial Viability

Standards •  Passenger & Driver

Safety •  Predictable Fare

Levels •  Response Times

(fringe areas) •  Response Times

(peak) •  Specialist Services

(wheelchair, MPTS)

Service Quality

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UberX upsets this balance…






(wheelchair, MPTS)

Industry Protections •  Set fare levels •  Limitation on supply

of cabs

Commercial Viability Service Quality

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…and can act to deteriorate service quality in important areas






(wheelchair)

Service Quality

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Agenda

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An uberX trip does not provide the same level of safety as a Taxi trip… §  Lower insurance coverage for

uberX drivers and passengers §  Lower driver safety checks for

uberX §  Lower levels of driver training for

uberX §  Lower standards for uberX

vehicles than taxis

…but it does provide a great user driver rating tool

§  Lower insurance coverage for uberX drivers and passengers

§  Lower driver safety checks for uberX

§  Lower levels of driver training for uberX

§  Lower standards for uberX vehicles than taxis

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Fares are usually cheaper but where do the savings come from? §  Less insurance= lower cost §  Less training= lower cost §  Lower vehicle standards= lower

cost

§  What about TAX? §  Focus on high demand areas=

better revenue (but what about travel at low demand)

uberX cuts Taxi service levels but focuses on demand peaks; what about low demand times/areas?

Figure 3 - Average Trips per Taxi in San Francisco between January 2012and July 2014

Averagetrips

Source: Kwong, 2014

Taxi Decline – San Francisco

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Wheelchair taxis – numbers of taxi’s constrain work opportunities for wheelchair users

Maxi Taxi Viability

Relies on a Solid

Non-Wheelchair market

e.g. Airport Access/ Tourists with

Luggage

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uberX has cut viability of wheelchair taxis in the US; what will happen in Melbourne?

Maxi Taxi Viability

Relies on a Solid

Non-Wheelchair market

e.g. Airport Access/ Tourists with

Luggage

Tota

l whe

elch

air t

rips

Figure 4 – Total wheelchair pick up by ramp taxi in San Francisco

Total wheelchair taxi trips

declined by 44%

between March 2013

to July 2014

Source: SFMTA TAB Meeting Sept 2014

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Agenda

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Is uberX the end of Transit?

Melbourne Grand Prix Transport Access

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Lets provide free taxis?

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All Taxis (3,000) = 9,000 event access trips

The Sums

•  3,000 taxis •  Say 3 person access

trips per taxi •  3 * 3,000 = 9,000

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Can we manage 3,000 taxis?

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195 cars

390 cars

560 cars

What about the other 191,000?

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9,000

191,000

0 50,000 100,000 150,000 200,000 250,000

Taxi

Don’t Know

Volume of Travel

Access to the Melbourne Grand Prix

Mod

e of

Acc

ess

PT = Volume and Efficiency

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Low density “Social Transit” ; be our guest!

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Smart Transit agencies think outside the box

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Transit runs the Car Share Scheme

Some Transport Researchers see uberX as a part of “Modal Convergence” trend

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Source: Enoch MP (2015) How a rapid modal convergence into a universal automated taxi service could be the future for local passenger transport’ Technology Analysis and Strategic Management

My view – uberX Futures

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UberX Futures

•  uberX has created wonderful innovations we should all be adopting and which we should encourage (app based booking; user driver assessment; surge pricing)

Its Time to

REGULATE

uberX [Data Access

Is a

Worthwhile

Objective]

•  uberX has created unfair outcomes for the taxi industry that need to be addressed

•  uberX will deteriorate taxi service overall which is NOT ACCEPTABLE •  “cool” and liberating smart

technology is no compensation for worse service in fringe areas or unemployed wheelchair users

www.worldtransitresearch.info

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professor graham currie the uber verdict

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