Ride Share Companies Expand Into Transit

by Sean Jeans-Gail, Vice President of Gov't Affairs and Policy | Rail Passengers Association

Transit has had a fraught relationship with the ride-sharing since companies like Uber and Lyft burst onto the urban transportation scene. Is it a competitor, undermining decades of transit ridership and revenue growth? A partner in solving the last-mile problems faced by many new transit systems? Or something in between?

This question has taken on new urgency with growing capital maintenance backlogs faced by legacy transit systems along major east coast and midwestern cities, and the introduction of slew of new rideshare services like E-bikes and electric scooters.

Ride-sharing companies are adding new wrinkles to this policy debate with their new product: train tickets.

Both Uber and Lyft have rolled out partnership with transit agencies all over the world, adding train icons to their app and letting users pay transit fare straight from their phone. Uber CEO Dara Khosrowshahi said its part of the company’s plan to become the “Amazon of transportation,” a one-stop shop for all transit services.

“When you’re taking your phone out of your pocket and deciding where to go, we want to be the first place that you go to,” said David Reich, who heads up Uber’s public transportation team.

Lyft has pursued its own strategy of developing transit partnerships, selling transit tickets, offering free rides to train stations, and giving users ride credits for each transit trip they take.

“We see ourselves as supportive of the transit industry and want to see the transit ridership grow and increase around the country,” explained Lilly Shoup, Lyft’s senior director of policy and partnerships.

While this may undoubtedly alleviate the need to own a car—something many Americans under 40 years of age are working towards—not everyone is sure this will end up being a clear cut win for transit agencies.

“There are real questions about forming partnerships that may end up pushing riders away from public transportation,” cautioned Adie Tomer, an infrastructure analyst at the Brookings Institution. “It’s a dangerous game for transit agencies to make agreements with ride-hailing companies.”

It creates an uncertain landscape for transit agencies, cities, and even passengers. One thing’s for sure, though: the threat from rideshare companies pales in comparison to the threat from failing infrastructure, service degradation, and poor on-time performance. Nothing will drive passengers into the arms of rideshare companies quicker than not being able to count on their local transit service getting them to work on time.

“You can’t innovate if you’re not meeting your basic demands,” said Brittney Kohler, the director of the National League of Cities’ transportation and infrastructure program.