In the era of ride-hailing, service providers often find themselves in contention with one another waiting to see who comes out victorious. Perhaps the most highly contended ride-hailer brawl is the one between Lyft and Uber.
Lyft came out swinging first with its initial public offering hitting the New York Stock Exchange March 29 with an estimated value of $24 billion.
While Lyft may have been the first to hit the market, Uber, which filed its S-1 — the necessary form for companies to go public ― with the U.S. Securities and Exchange Commission on April 11, seems to pack the harder punch with an anticipated valuation of approximately $100 billion when it goes public later this year.
The New York Times reports such valuation is set to be the highest the market has seen since 2014, when China’s Alibaba Group entered the New York Stock Exchange.
Lyft and Uber not only compete for revenue, but they’re also rivaling for research in an effort to create the latest ride-hailing product. Latest creations include dockless bike and scooter rentals and meal delivery services.
For those in academia, like the University of Illinois Urbana-Champaign’s (UIUC) College of Civil and Environmental Engineering Assistant Professor Lewis Lehe, the constant competition is fun to watch.
“From a mobility perspective, the services to watch are those that let people share a trip,” Lehe said.
Lyft and Uber are generating a myriad of ideas, including Lyft’s Shared Saver and Uber’s Express Pool, which pick up and drop off passengers en route to a destination and/or allows passengers to congregate in one area awaiting pickup ― similar to bus stops.
Both options are a win for consumers, who would have otherwise been taxed in some metropolitan areas. In Manhattan, ride-hailing comes with a $2.75 congestion surcharge, but shared ride-hailing brings the surcharge down to 75 cents.
Carpooling has even made headway on ride-hailing services’ agendas, coordinating rider carpools for those with similar commute start and end points using ride-hailing services for a shared ride experience.
Current industry leaders include Scoop and Waze Carpool, which is owned by Google’s parent company ― Alphabet.
“For policymakers, the advantage of these services is that they subtract rather than add new cars to the road,” Lehe said.
In recognition of these potential savings, California’s San Mateo County subsidizes all carpool rides through Scoop.
By far the most exciting of the two ride-hailing service providers’ research is that of autonomous vehicle development.
That’s something UIUC’s leading transportation research facility, ICT, cares a great deal about given its vision to create a multiplatform testing arena for autonomous and connected vehicles — known as the Illinois Automated and Connected Track ─ by the fall of 2022.
“Both companies have bold plans for the future,” Lehe said.
Such plans are bold indeed with Uber’s research team, Advanced Technologies Group, spending $500 million alone in autonomous vehicle development and an air taxi service known as Uber Elevate. Lyft’s researchers, known as Level 5, have devoted an engineering center to speed along autonomous technologies.
Not only are Lyft and Uber battling to see who can develop autonomous vehicles for ride-hailing, but the two are also attempting to develop drone delivery services to strengthen e-commerce.
Despite millions of dollars and dedicated research centers, progress has been “slower than anticipated,” Lehe said.
“The companies hope that in the long run they can operate huge fleets of autonomous vehicles to provide shorter wait times at lower costs,” Lehe said.
What does this mean to the average motorist? Opportunities for ride-hailing are endless.
The future of ride-hailing with autonomous vehicles could mean less private car ownership, less dedicated land space for parking, and thus more real estate possibilities.
“They hope to scale up their shared ride operations to the point that private car ownership and travel decline markedly,” Lehe said. “For researchers and policymakers, it is important to note that this vision portends a very different future, especially in regards to parking.”
“Parking consumes vast amounts of land and floor space, even in America’s densest cities,” Lehe added. “A future where people take shared rides everywhere could unlock enormous real estate potential.”
Posted: May 1, 2019
Written by: Emily Jankauski