Uber and Lyft have touted their ride-hailing companies as ‘car-cutters’ by reducing the number of vehicle ownerships in US metro areas, but a new study finds the claims are far from the truth.
A team from Carnegie Mellon University found, on average, a 0.7 percent increase in personal vehicles after the two firms unleashed their services into a new market from 2010 to 2017.
Larger increases of vehicle registrations were observed in car-dependent cities, those with a slower rate of population growth, more children or deemed lower income.
Although the uptick is small, researchers told Wired that the new study is an improvement on previous work that analyzed state-level and found Uber and Lyft reduce car ownership rates.
Uber and Lyft have touted their ride-hailing companies as ‘car-cutters’ by reducing the number of vehicle ownerships in US metro areas, but a new study finds the claims are far from the truth
Jeremy Michalek, a professor of engineering and public policy at Carnegie Mellon University and co-author on the study, said: ‘I would have expected people to own fewer vehicles once they gain access to this alternative transportation mode.’
‘But that’s not what we see in the data. One possible explanation could be that there’s an effect on the other side, where somebody who was on the verge of being able to afford a vehicle now has an incentive to buy one and earn some money with it.’
‘So vehicle adoption by Uber and Lyft drivers may outweigh the effect of riders getting rid of their personal vehicles.’
Uber and Lyft are both known for embellishing when it comes to their companies.
A team from Carnegie Mellon University found, on average, a 0.7 percent increase in personal vehicles after the two firms unleashed their services into a new market in 244 cities from 2010 to 2017
Uber made claims that it provides drivers with the ‘best financing options available,’ stating on its website that uberX drivers rake in an annual income of more than $90,000.
However, the statements were deemed to be ‘exaggerated earnings claims’ and settled charges with the Federal Trade Commission by paying $20 million in 2017.
Although not as bad, Lyft’s website says 49 percent of its riders without a car ‘would be more likely’ to purchase one if not for them entering the market.
It also claims that its service played a part in people’s decision to get rid of 500,000 personal vehicles.
Researchers at Carnegie Mellon looked at 224 urban areas in which either Uber or Lyft had infiltrated starting in 2012 through 2017.
They then collected annual individual vehicle registration data with annual ZIP code level sociodemographic from the U.S. Census Bureau and aggregate to the urban area to estimate effects.
Unlike other works that only looked at the congested centers of cities, Carnegie Melon’s analyzed entire urban area.
The data shows an increase in areas that had higher initial vehicle ownership before the Transportation Network Companies (TNC) came to town, which the study refers to as ‘car-dependent cities.’
Increases were also observed in cities that had lower growth rates and income, along with areas home to more children.
However, the opposite was found in certain metro areas.
When Uber or Lyft entered a city that had less children, more money and less cars, the move resulted in a lower number of personal vehicle registrations.
‘What this suggests to me is that in a city where people have disposable income and fewer children, they don’t mind paying more for a more convenient mode of transportation, and they don’t have to worry about logistics like bringing a car seat,’ says Michalek.
While the researchers were able to identify trends across cities in their data analysis, they are also interested in investigating how these trends stack up in specific cities.
Larger increases of vehicle registrations in cities with Uber and Lyft were observed in car-dependent cities, those with a slower rate of population growth, more children or deemed lower income
Additionally, their analysis only accounts for pre-pandemic patterns that have certainly changed because of COVID-19.
‘Of course, the pandemic has caused enormous changes in ridesourcing, public transit, and transportation trends in general,’ said Michalek.
‘With many employees working from home, and many others opting to use personal vehicles for travel, ridesourcing services have seen a drop in riders.’
‘The question is, once the pandemic is behind us, do we return to the kinds of travel patterns and choices we saw before the pandemic, or are there systemic changes that won’t go back to normal because people have permanently changed their behavior? We won’t know for sure until it happens.’