Will Ridesharing Replace Owning Cars?

Will Ridesharing Replace Owning Cars?

October 25, 2018
ridesharing replace owning cars

Will Ridesharing Replace Owning Cars?

Although ridesharing has become more widespread in recent years, their services are only available in select cities. Lyft is only running in 640 cities nationwide whereas Uber is currently operating in 322 cities. While Lyft did announce in their 2017 report that 250,000 of its users reported abandoning car ownership in favor of ridesharing, they also reported 520,000 additional Lyft drivers were introduced the same year. Despite their popularity and initial reports of a drop in car ownership by Lyft, it seems unlikely and a long road ahead before the verdict is out on whether ridesharing replace owning cars altogether.

Ridesharing Concentration

Ridesharing companies such as Uber seem to be concentrated in cities where several factors make its adoption easier:

  • Population density for both getting drivers (supply) and riders (demand)
  • Concentration of jobs and hence commuters who need to get to and from places daily
  • Existence of current public transportation which makes introducing ridesharing easier to the mass public
  • Expensive housing and limited parking spaces which makes owning a car less affordable

However, for places that do not meet those criteria or where owning a car makes more sense practically and financially, ridesharing companies would not stand a chance. Furthermore, it’s worth noting that cities which have these characteristics have resisted ridesharing for a number of reasons.

Ridesharing Concerns

The idea that ridesharing replace owning cars seems unlikely given that major cities have resisted ridesharing services. Common critiques include arguments that they would:

    • Take away jobs (clients) from existing taxi drivers and other public transportation channels
    • Add to traffic congestion and air pollution by adding more vehicles onto the road
    • Raise safety concerns as drivers use their own vehicles to transport riders to and from places

Interestingly, these ridesharing companies themselves have begun to evolve in recent years in response to these issues. With its current model, these companies must always have sufficient supply (drivers) to meet rider demand. In addition to marketing costs and revenue sharing with drivers, there are also legal obligations. Hence, given these concerns and considerations, it makes sense that these ridesharing companies expand their focus.

New Mobility Options

As reflected in Uber’s mission statement and its purchase of Jump earlier this year, the ridesharing giant is broadening the market by diversifying mobility beyond cars. In the past couple of years, bicycle rentals and electric scooters  have popped on the ridesharing scene. Made possible by technology that allows for dockless placements, these two new options are affordable and convenient for riders. As for the companies themselves, these mobility options address congestion concerns while also eliminating the need for drivers. Nonetheless, these new transportation vehicles are only available in a handful of cities. Additionally, similar to their predecessors, they have also raised concerns especially in regards to when riders drop-off vehicles at unauthorized spots.

Concluding Thoughts

For the time being, ridesharing options are exactly that, transportation alternatives to owning a car. Each alternative has their pros and cons to both rider and community. Ultimately, the rider will be the one to decide on their transportation method. For some, owning and driving their own car will always be the preferred method. For others, taking public transportation or ridesharing may be the norm. Hence, although ridesharing has taken the world by storm in the past several years, it doesn’t seem likely (at least in the near future) that ridesharing replace owning cars anytime soon.

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