Ridesharing apps like Uber, Lyft, Hovit, Gett, Chariot and others are changing the way the world moves. Instead of relying on systems like taxi cabs, trains, shuttles, etc. more and more people are turning to ridesharing to fulfill the need for human transport. As with just about anything, when people start using something newer, more cost efficient and convenient, they stop using the old method. Here’s a list of 10 industries that are being disrupted by ride sharing.
What Industries Are Being Disrupted By Ridesharing?
Taxi Cabs
Taxis are the obvious first victim of the on-demand ride sharing phenomenon. Uber is more convenient, safer, faster and of course it’s cheaper and as a consumer, you actually have a means of recourse when you have a bad driver because you can leave a review. The days of taxi cabs are limited as more and more people are filling the seats of cars already on the road instead of relying on an old service that is stuck in the 1900’s.
Pedicabs
Pedicabs are those people who ride people around certain cities in those large tricycles you see in downtown metro areas. Their average rate is around $1-2 per block depending on your driver and they can only really carry about 3 passengers, they aren’t usually climate controlled and are only good for very local traffic. Uber only costs about $1/mile (here in Denver), can carry 4-6 passengers in a climate controlled environment and can go much further for less money.
Shuttle Buses
Shuttles are often used for people going to airports and other popular destinations but with more and more people now using Uber, the demand for such services are becoming less and less. Since Uber offers pickup at your door and drops you off at your destination there is much less demand to run on someone elses schedule and not your own. The days of these old services is numbered unless it can somehow integrate tech to make itself more efficient and convenient. A San Francisco based company, Chariot is taking on the challenge. We’ll see how well it works out.
City Buses
Buses are one of the first means used to solve the need for human transport in densely populated cities. They tend to work pretty well but their model is outdated and based on fixed routes. More and more people who take the bus are turning to Uber as an alternative when the bus just isn’t as convenient at the end of a long day. UberPOOL is a newer service launched by Uber to incentivize people to share rides with strangers in order to reduce costs, traffic and Co2 emissions. Uber claims that the driver makes more money on these rides but most drivers seem to hate UberPool so I’m not sure that Uber’s claim is accurate.
Subway/Train
Trains are one of the most common forms of transport in a number of larger cities but trains are limited to tracks and awkward timetables and every person in your party needs to have their own ticket. Uber’s fare Split feature is very useful between a group of friends and when you divide the fare between more people, it isn’t uncommon for it to be cheaper to take an Uber than taking a train. Here in Colorado, we have the light rail and that costs about $6-8 for a single person to go to Denver one way from the other end of the line. If you multiply that by 3 or 4 people, you get $18-32 to get to a train station in like 30-40 mins. $18-32 spent on a Uber would probably get you from downtown Denver to the other end of the line with a couple stops on the way if you need to drop off and often in less time than the train.
Car Rentals
Car rentals have been slowing since it is often cheaper and way less hassle to just use a car when you need it rather than having waiting in line at the rental place, filling out all sorts of forms, refusing “the upsell” car and all so you can pay $$$ for it to sit idle in a parking lot for most of the time that you rent it. In fact, here in Denver Enterprise Rent a Car realized that Uber was taking away from their revenue and they actually started a new program where you can rent a car through Enterprise and drive for Uber and the first $X from your rides pays for the car rental. This allows someone without a car to get behind the wheel of a newer model car as long as they give a certain amount of rides per week. I think the future of most car driving is going to be some sort of sharing model.
New Car Sales
Brand new car sales are also in direct competition with Uber and ridesharing services. I have given a number of rides to people who have chosen to not own a car because it is cheaper and often more convenient to just use Uber to get everywhere. When you add up the costs that come with owning a car like car payments, insurance, registration, parking, gas, oil changes, tires, brakes and even the risk of a collision, you can see how quickly it becomes cost effective to use Uber instead of owning a vehicle.
Short Term Parking and Valet Parking
Parking lots are also being disrupted by Uber. With downtown parking costing as much as $25 for a single day (here in Denver) and upwards of $50/day (in cities like NYC) it makes much more sense to take an Uber to and from your event. Uber has even begun to offer discounted fares to and from sporting events like baseball games to incentivize people to use their service to get to and from certain events.
Long term parking
Long term parking at places like airports is going to be a thing of the past as soon as more people realize how much they can save by not using it. I’m going to use the Denver International Airport Economy Parking Lot as an example. The rate for economy lot is $8 per day so if I go on vacation for 10 days and pay for parking the whole trip, I will need to pay $80 just to park my car. I also have to drive to the lot, find a parking spot, then wait for a shuttle to pick me up and stop a few more times to pick up other people and then we drive really slow to the terminal and I might be standing during all of this since there might not be any seats left and then you get taken to their designated drop off spot, not at your airline check-in counter. When I return from my trip, I will have to do the same thing all in reverse except when I return I might find my car covered in snow. With Uber I get picked up at my front door and dropped off at the check-in counter for about $35 each way. So if I do that both ways, I will only pay $70 for much more convenience. Keep in mind that is just for the economy lot. The standard lot is $13/day and the garage is $24/day You don’t have to wait for a shuttle and in the garage you don’t have to worry about snow being all over your car when you return to it but when you do some simple cost analysis, you will find that it is often much much cheaper to take Uber to the airport instead of getting fleeced by airport parking prices.
Local governments and Police
Local governments generate a lot of revenue from petty offenses like parking tickets and moving violations. They also help ruin lives of people who have had “one too many”. Well luckily, Uber helps to reduce those risks for the people by offering rides in someone else’s car. Austin Texas recently banned rideshare apps and the number of DUI arrests increased 7% within 45 days of the ban. $20 with Uber is way better than petty $75 parking tickets, $40 camera tickets and especially a DUI and $10,000 in court fees.
The very concept of centralized ownership is being challenged by the shared economy and it is only speeding up. It is only a matter of time before some of these industries listed above become as relevant and useful as the phone book. If you aren’t already a part of the shared economy, I think you should take a look at how you can travel more often and for less money by using services like Uber. I think you will be glad that you did.
What do you think of Uber’s push to have self driving cars on the road? Will this make Uber better or worse? And as a driver how do you feel about them?
Great questions, Casey. I am hugely in favor of self driving cars not just for Uber but for all sorts of transit all over the world. Airport terminal transit, school buses, helping the elderly get around etc.
I think they will make Uber and all ridesharing services much better but I don’t see robots completely taking over human driver jobs anytime in the next 5 years. There will be so much legal pushback from so many different directions that they will likely only really be feasible in larger cities and regulations will vary from one jurisdiction to the next.
As a driver, I am a huge advocate for self-driving cars. It’s important to note that I am also an Uber rider and I want cheaper fares all around the world so I can use Uber to travel to more places more often for less money. The number of global passengers far outnumbers the number of drivers so I see the cost savings and global benefit much greater when more people can get around for much less.
In short, there will probably be tens of thousands of people who lose their jobs as drivers around the world but millions (if not billions) of people will gain access to cheaper transportation as long as the self driving market stays competitive.
I view robot labor as a kind of ethical form of slavery. Robots are property that work for no wage, up to 24 hours a day, never get tired, never talk back or complain and you also don’t have to file all sorts of paperwork and tax documents to have them work for you. It’s a win for everybody as long as it isn’t monopolized by any single entity or just a few of them.
What about you? What do you think about self driving cars and Uber? better or worse? I hear they will be piloting them in Pittsburgh within a year but will be manned by not just one but two engineers to monitor how the cars behave.
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