Uber looks to be one-stop shop for all rides
In widening experiment, company is partnering with transit in some cities to offer train tickets and bus service
DENVER — When Julia Ellis arrives at a train station in a suburb here to go to work, she opens her Uber app. Next to the ride-hailing options, she taps a train icon marked “Transit.”
The click buys her a ticket for Denver’s public transit system, the Regional Transportation District. Ellis said she has used Uber to get her train tickets since the company rolled out the feature this spring. She also often takes an Uber ride to the station because a medical condition limits her driving.
“You make two clicks and you’re there,” Ellis, 54, said of how Uber and Denver’s train system had changed her commute.
Ellis is part of a widening experiment for Uber. As the company seeks new growth, it has teamed up with cities and transit agencies in in the United States, Canada, Britain and Australia to provide tickets, to transport people with disabilities or sometimes to substitute for a town’s public transportation system entirely.
One of Uber’s earliest partnerships was in 2015
with Dallas Area Rapid Transit. Since then, Uber has signed more than 20 transit deals.
The push now is being championed by Dara Khosrowshahi, its chief executive, to turn the company into the “Amazon of transportation.” In that vision, Uber would become a onestop shop for car, bike, scooter, bus and train trips.
Doing so would help
Uber draw more riders, especially as the company faces questions from Wall Street about whether it can make money and revive its once red-hot growth rate.
On Thursday, Uber is scheduled to report its latest earnings, including an estimated quarterly loss of nearly $5 billion and declining revenue growth.
“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, an Uber director who heads the team that the company formed last year to focus on public transportation.
Uber has pitched itself as being able to provide cheaper and more flexible transportation, especially in locations where public transit is scant. But mixing ride-hailing with their their services has left some city officials uneasy.
With transit ridership falling in major metropolitan areas across the United States, agencies said they risked ceding even more passengers to Uber and similar services, like Lyft.
Authorities also have criticized Uber for not sharing enough rider data, which could help agencies plan new transit routes.
Cities also worry that Uber and Lyft could increase congestion. A recent study commissioned by the companies found they were contributing to congestion, though they are outstripped by personal vehicle use.
“There are real questions about forming partnerships that may end up pushing riders away from public transportation,” said Adie Tomer, a metropolitan policy fellow at the Brookings Institution, who studies infrastructure use. “It’s a dangerous game for transit agencies to make agreements with ride-hailing companies.”
In a filing in April, Uber stoked competitive fears by saying it aimed to replace public transportation altogether. The sentence was replaced in a later filing with a promise that Uber would integrate public transit into its app “as an additional low-cost option.”
Lyft also has moved into public transit. It began offering free rides to a train station in a Denver suburb in 2016. Now it has 50 transit deals in the United
States, including a partnership with the Los Angeles Metro in which Lyft car pool riders can earn free credits to take public transit.
“We see ourselves as supportive of the transit industry and want to see the transit ridership grow and increase around the country,” said Lilly Shoup, Lyft’s senior director of policy and partnerships.
Uber’s public transit partnerships vary by place. But with most of the agreements, cities tap the company’s network of drivers to provide rides in areas that do not have reliable bus routes. Cities often subsidize the rides so that passengers pay what amounts to a bus fare rather than a typical Uber fee. Uber generally earns a subsidy from the transit agency, a fare from the rider or both.
In Denver, the partnership is centered on ticketing rather than car rides. Through Uber’s app, people get a new way to buy tickets and obtain train and bus schedule information. Uber doesn’t make money selling the tickets, but it benefits when ticket buyers, like Ellis, stay in the app to book a ride from the train station to their destination.