Quantifying the Requirements to Scale a Carpooling Business

21 Pages Posted: 19 Jul 2017

Date Written: July 8, 2017

Abstract

Carpooling is now seen as last big opportunity to grow a shared mobility as a service (MaaS) business ahead of the arrival of autonomous vehicles (AVs).

We present the case that Waze’s altruistic vision of carpooling is insufficient to scale the business.

Our transactional vision of the business, requiring market pay rates to drivers, creates little incentive for people to choose carpooling over solo commuting.

We think that it will take a minimum of $4,000 in cost saving to motive a significant number of people to go carless. This implies that fares will have be reduced by an additional $1,583 a year to reach that level of cost savings.

The way to recoup this is by negotiating referral credits (dollar or accounting) with related units offering last-mile ride-sharing, delivery, and weekend car rentals.

Keywords: carpooling, congestion pricing, Mobility-as-a-Service, MaaS, Waze, Uber, Lyft, Ford Smart Mobility, HOV lanes, ride-hailing, carpooling, reverse commuters

JEL Classification: R40, R41, R48, H23, L81, L86, L87, L91, L92

Suggested Citation

Abrams, Lawrence, Quantifying the Requirements to Scale a Carpooling Business (July 8, 2017). Available at SSRN: https://ssrn.com/abstract=2999112 or http://dx.doi.org/10.2139/ssrn.2999112

Lawrence Abrams (Contact Author)

Independent ( email )

PO Box 1285
Watsonville, CA 95077
United States
831-254-7325 (Phone)

HOME PAGE: http://nu-retail.com

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