Wikipedia

Ridesharing company

(Redirected fromRide hailing)

Aridesharing company(orridehailing service) is a company (or service offered by a company) that, via websites andmobile apps,matches passengers with drivers ofvehicles for hirethat, unliketaxis,cannot legally be hailed from the street. The vehicles used in ridesharing/ridehailing service are calledapp-taxisore-taxis.

YellowUbercar inMoscow

Ridesharing companies were founded beginning in the 2010s, after the proliferation of the Internet and mobile apps.[1]In the 2020s, a few companies began offering rides inself-driving taxis.

Thelegality of ridesharing companies by jurisdictionvaries; in some areas they are considered to beillegal taxi operations,while in other areas, they are subject to regulations that can include requirements for driverbackground checks,fares, caps on the number of drivers in an area, insurance, licensing, andminimum wage.

Studies have shown that ridesharing companies have created net jobs[2]and improved the efficiency of drivers ofvehicles for hiredue to advanced algorithms that pair riders with drivers.[3]They have been subject to perennial criticism for seeking to classify drivers asindependent contractors,enabling them to withholdworker protectionsthat they would have been required to provide to employees.[4][5]Studies have shown that especially in cities where it competes withpublic transport,ridesharing contributes totraffic congestion,reduces public transport use, has no substantial impact on vehicle ownership, and increasesautomobile dependency.[6][7][8]

Terminology: ridesharing vs. ridehailing

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Although the term "ridesharing" is used by many international news sources,[9]in January 2015, theAssociated PressStylebook, the authority that sets many of the news industry's grammar and word use standards, officially adopted the term "ride-hailing" to describe the services offered by these companies, claiming that "ridesharing" doesn't accurately describe the services since not all rides are shared, and "ride-sourcing" only is accurate when drivers provide rides for income. While the Associated Press recommended the use of "ride-hailing" as a term, it noted that, unliketaxis,ridesharing companies cannot pick up street hails.[10][9]

The term "ride-sharing" has also been defined to refer to on-demandcarpoolingorshared transport,whereas "ride-hailing" has been defined as the hiring of a private driver for personal transportation.[11]

History

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Carpooling was popular in the mid-1970s due to the1973 oil crisisand the1979 energy crisis.The first employee carpools/vanpools were organized then atChryslerand3M.[12]

In the 1990s, carpooling was popular among college students, where campuses have limited parking space. The feasibility of further development of carpooling was investigated although the comprehensive technologies were not commercially available yet at the time.[13][14]

Ridesharing programs began migrating to theInternetin the late 1990s.[14]

A 2006 report by theFederal Transit Administrationstated that "next day" responsiveness has been achieved but that "dynamic" ridematching has not yet been successfully implemented.[15]

In 2009,Uberwas founded as Ubercab byGarrett Camp,a computer programmer and the co-founder ofStumbleUpon,andTravis Kalanick,who sold hisRed Swooshstartup for $19 million in 2007.[16][17]

In 2011,Sidecarlaunched; its founderSunil Paulpatented the idea of hailing a ride viamobile appin 2002.[18]

Lyftwas launched in the summer of 2012 by computer programmersLogan GreenandJohn Zimmeras a service ofZimride,an intercitycarpoolingcompany they founded in 2007.[19]

Careembegan operations in July 2012.[20]

Bolt,a mobility company operating in Europe and Africa, was founded in 2013.[21]

In 2013,Californiabecame the first state to regulate such companies; they are regulated aspublic utilitiesby theCalifornia Public Utilities Commissionand the legal term used is "Transportation Network Company" (TNC).[22]

In the 2020s, a few companies such asWaymobegan offering rides inrobotaxis.Many pilot cities complained of vehicles blocking normal traffic flow and interfering with emergency services.[23]

BlackWolf began in May 2023 inAtlanta, Georgiaafter security contractor Kerry KingBrown heard a woman claim she had been a victim ofsex trafficking.He felt the need to focus on safety, and he created the service with the option ofarmeddrivers. The company's web site says only those with military or law enforcemenmt experience can be hired as drivers, and their vehicles must meet requirements. BlackWolf expanded into cities inFlorida,TennesseeandArizona.By November 2024, over 300,000 were using the service. Expansion intoTexasis planned for 2025, because BlackWolf "identified a significant increase in human trafficking" there.[24]

Criticism

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See also:Sharing economy § Criticism,andTemporary work § Legal issues
Airports in California, such as theSan Francisco International Airport,regulate where TNC (Transportation Network Companies - the legal term for rideshare companies in California) vehicles may pick up, drop off, or wait for passengers.

Criticism from taxi companies and taxi drivers

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Values oftaxi medallions,transferable permits or licenses authorizing the holder to pick up passengers for hire, have declined in value significantly. In 2018, this led tofailuresbycredit unionsthat lent money secured by taxi medallions[25]and suicides by taxi drivers.[26][27]

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No lawsuit against Uber in which the plaintiffs were taxi companies has ended with a judgment in favor of the taxis. The only case that proceeded to trial, Anoush Cab, Inc. v. Uber Technologies, Inc., No. 19-2001 (1st Cir. 2021), which alleged that Uber caused asset devaluation by competing unfairly, resulted in a full verdict for Uber.[28]

Flywheel, the largest operator of taxis in San Francisco, sued Uber in 2016, allegingantitrustviolations andpredatory pricing.[29]In 2021, a federal judge threw out the bulk of the case and Uber settled the remainder of the case by integrating Flywheel taxis into its mobile app.[30]

In 2019, 8,000 taxi drivers, represented by law firmMaurice Blackburn,filed aclass actionlawsuit against Uber in Australia allegingillegal taxi operations,loss of income and loss of value of taxi and/or hire car licences. Uber agreed to settle the case by paying AU$271.8 million.[31]

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Driver classification under employment law

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Unless otherwise required by law, ridesharing companies have classified drivers asindependent contractorsand not employees underemployment law,arguing that they receiveflextimenot generally received by employees. This classification has been challenged legally since it affects taxation,minimum wagerequirements,working time,paid time off,employee benefits,unemployment benefits,andovertimebenefits.[4]

Jurisdictions in which drivers must receive the classification of "employees" include the United Kingdom (after the case ofAslam v Uber BVwhich was decided by theSupreme Court of the United Kingdom),[32][33]Switzerland,[34]New Jersey,[35]and theNetherlands.[36][37]California Assembly Bill 5 (2019)was passed to force drivers to be classified as employees inCalifornia,although ridesharing companies received an exemption by2020 California Proposition 22,a ballotinitiative.[5]Ridesharing companies spent tens of millions of dollars on the campaign.[38][39]

In some jurisdictions, laws were passed to guarantee drivers a minimum wage before and after expenses as well as paid time off and insurance benefits.[40][41]Uber has paid to settle accusations of having misled drivers about potential earnings[42][43][44]and shortchanging drivers.[45][46][47][48]

Price fi xing allegations

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In the United States, drivers do not have any control over the fares they charge. A lawsuit filed in California, Gill et al. v. Uber Technologies, Inc. et al., alleged that this is a violation of theSherman Antitrust Act of 1890.The lawsuit was deniedclass actionstatus; a judge forced each plaintiff to go toarbitrationindividually. The case was dropped in March 2024.[49][50]

Safety issues

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Crimes have been committed by rideshare drivers[51]as well as by individuals posing as rideshare drivers who lure unsuspecting passengers to their vehicles by placing an emblem on their car or by claiming to be a passenger's expected driver.[52]The latter led to themurder of Samantha Josephsonand the introduction ofSami’s Law.Ridesharing companies have been accused of not taking necessary measures to prevent sexual assault.[53][54]They have been fined by government agencies for violations in their background check processes.[55][56][57]

Ridesharing has also been criticized for encouraging or requiring phone use while driving. To accept a fare, some apps require drivers totaptheir phone screen, usually within 15 seconds after receiving a notification, which is illegal in some jurisdictions since it could result indistracted driving.[58]

Ridesharing vehicles in many cities routinely obstructbicycle laneswhile picking up or dropping off passengers, a practice that endangers cyclists.[59][60][61]

Insufficient accessibility

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Ridesharing has been criticized for providing inadequateaccessibilitymeasures for disabled people, in violation of local laws.

In some areas,vehicle for hirecompanies are required by law to have a certain amount ofwheelchair accessible vans(WAVs) in use. However, most drivers do not own a WAV, making it hard to comply with the laws.[62]

While ridesharing companies require drivers to transport service animals, drivers have been criticized for refusal to transport service animals, which, in the United States, is in violation of theAmericans with Disabilities Act.In 2021, an arbitrator awarded $1.1 million to a visually impaired passenger who travels with aguide dogbecause she was denied rides 14 separate times.[63]

Driver bias against passengers in certain demographic groups

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Severalaudit studiesof ridehailing companies have been conducted by researchers around the U.S. While these studies do find evidence that ridehailing drivers discriminate against riders on the basis of race (and in one of the studies, alliance with LGBT groups), two of the studies which also examined taxis found suggestive evidence that rates of discrimination by taxi drivers are significantly higher than by ridehailing drivers.[64][65]The two studies that compare rates of discrimination in ridehailing services to taxis include an audit study set in Los Angeles in 2017 and another in Boston in late 2015 to 2016.

In the study set in Los Angeles, the author had participants of different races request rides from Uber, Lyft, and taxis. She found that Black riders were 73% (11 percentage points) more likely to have a taxi driver cancel on them than White riders. On the other hand, she found that Black riders were only 4 percentage points more likely to be cancelled on by an Uber driver than White riders (there was no statistically significant difference in likelihood for Lyft).[65]

The Boston study notes that, at least at the time that the study was conducted, Lyft drivers were able to see all information in a rider's profile (including their uploaded photo and name) when reviewing a ride request; on the other hand, Uber drivers were only able to see a rider's name (and not their picture)afteraccepting a ride request. Thus, in the Boston study, riders were assigned distinctly "African American sounding names" and "white sounding names" to use when requesting a ride from both Uber and Lyft. Uber's setup of not allowing drivers to see rider's names till after a ride was accepted meant that the authors could quantify rates of discrimination by keeping track of how often riders assigned white sounding names were cancelled on compared to those assigned African American sounding names. In the end, the authors found that the riders assigned African American sounding names were more than twice as likely to get cancelled on as those assigned White sounding names. Despite this large disparity across the two groups, the authors found that there was no statistically significant difference in how long each group had to wait for a driver to arrive.[64]

In 2024, a study by researchers at Carnegie Mellon University was published that focused on explaining why African American and White riders could experience such different cancellation rates but very similar wait times. Using an agent-based model developed to simulate real Uber and Lyft trips that have occurred in the city of Chicago, they found that the rapid rematching speed of Uber and Lyft drivers after a cancellation drastically reduces the effect of that cancellation on a rider's wait time. However, the paper also found that ridehailing services were not able to overcome the effects of racial residential segregation in Chicago (one of the most racially residentially segregated cities in the country[66]); even when no drivers were cancelling on riders because of their race, the authors found that Black riders were waiting around 50% longer on average than White riders.[67]

In addition to the studies discussed in detail above, a 2018 study inWashington, D.C.found that drivers cancelled ride requests fromAfrican AmericansandLGBTandstraight allypassengers (indicated by arainbow flag) more often, but cancelled at the same rate for women and men. The higher cancellation rate for African American passengers was somewhat attenuated at peak times, when financial incentives were higher.[68][69]

Traffic congestion

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Studies have shown that especially in cities where it competes withpublic transport,ridesharing contributes totraffic congestion,reduces public transport use, has no substantial impact on vehicle ownership, and increasesautomobile dependency.[6][70][8][7]

Dead mileagespecifically causes unnecessary carbon emissions and traffic congestion.[71]A study published in September 2019 found thattaxishad lower rider waiting time and vehicle empty driving time, and thus contribute less to congestion and pollution in downtown areas.[72]However, a 2018 report noted that ridesharing complements public transit.[73]A study published in July 2018 found that Uber and Lyft are creating more traffic and congestion.[74][75][76]A study published in March 2016 found that in Los Angeles and Seattle the passenger occupancy for Uber services is higher than that of taxi services, and concluded that Uber rides reduce congestion on the premise that they replace taxi rides.[77]Studies citing data from 2010 to 2019 found that Uber rides are made in addition to taxi rides, and replace walking, bike rides, and bus rides, in addition to the Uber vehicles having a low average occupancy rate, all of which increases congestion. A 2021 study found that shifting private vehicle travel to ridehailing services can reduce air pollution costs, on average, but the increased costs from crash risk, congestion, climate change and noise outweigh these benefits.[78]This increase in congestion has led some cities to levy taxes on rides taken with ridesharing companies.[79]Another study shows that the surge factor pricing mechanism used for ridehailing services are informative for predicting taxi bookings as well, and that taxis incorporating this relative price can improve allocative efficiency and demand prediction.[80]

A study published in July 2017 indicated that the increase in traffic caused by Uber generates collective costs in lost time in congestion, increased pollution, and increased accident risks that can exceed the economy and revenue generated by the service, indicating that, in certain conditions, Uber might have asocial costthat is greater than its benefits.[81]

See also

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References

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