Smart shared taxis: A bonus for urban transport?

09 May 2019

So why exactly would you want to sit alone in your car as you crawl through the streets, further exacerbating traffic and environmental problems, when you could be sharing the journey to your destination with others? It’s with this idea in mind that ride-sharing providers are seeking to make urban transport both more efficient and more sustainable. Shuttles of this sort are already on the road in Berlin, Hanover and Duisburg. VW subsidiary Moia has just launched in Hamburg with one hundred electric mini­buses and big ambitions. We took a closer look at these smart shared taxis.

On Hamburg’s Innenalster, there isn’t a taxi to be seen. And yet, you’re only one click away from the next way of getting from A to B. Simply touching your smart­phone display brings up the relevant app, and no sooner have you entered your actual location and destination than the ride on offer is confirmed. “Your Moia will arrive in 17 minutes. It will be setting off in 13 minutes,” the app says. And off we go.

Moia is the name of the shuttle service launched along with the VW subsidiary of the same name in Hamburg in mid-April - and it has big ambitions. As Moia boss Ole Harms put it at the first presentation at the end of 2016, the Volkswagen Group’s aspiration for Moia is to turn it into one of the world’s big three mobility providers. By 2025, a “substantial part of the Group’s revenue should be accounted for by the new business division,” Harms says. All this has been rendered possible by a concept which is variously referred to as “ride sharing” or “on-demand mobility”.

The idea behind it is actually nothing new: “On-demand” buses or shared taxis have for years been plying transport routes in rural areas with under­developed transport infrastructure, providing more flexible mobility and better use of capacity. Unlike their rural forebears, however, the Moias are to be found in the heart of the great metropolises and can be conveniently called by app rather than ordered by phone. And whereas in the latter case a human scheduler coordinates the transportation needs of Mrs. Smith and Mr. Jones, in the former it is an algorithm which links the transport requests of different people, thereby finding the nearest vehicle and best route for all of them. In this way, ride-sharing services aim to combine the convenience and flexibility of the private car with the efficiency of local public transport. At a price which, albeit more than you would pay for a bus ticket, is still noticeably less than the cost of a taxi ride. The principal ambition is this: anyone who can easily and conveniently get from A to B by shuttle will leave their own car on the drive, thereby easing both the traffic situation and the environmental crisis. The VW mobility firm aims to replace one million private cars in Europe and the US by 2025 - such, at any rate, is the promise given by Moia boss Harms. And, according to the calculations in a study conducted by the International Transport Forum (ITF) for Lisbon, if the smart shuttle buses should become self-driving, they could make anything up to nine out of ten ordinary cars redundant.

Moia launched in Hanover in July 2018, mainly to start with in the city centre. In the mean­time, some 80 shuttle buses are now patrolling the entire city, with the aim of motivating even commuters from outlying suburbs such as Vahrenheide, Misburg or Stöcken to leave their cars at home. Moia started operations in Hamburg with 100 shuttles, with the intention of increasing this count to 500 by the end of the year. Moia had originally applied for a fleet of 1000 vehicles. The supervisory body for the transport industry initially gave its permission for just half that number. This can clearly be seen, among other things, as a concession to the taxi industry, which fears that Moia could lure its customers away.

Unlike in Hanover, the vehicles in use in Hamburg are exclusively electric mini­buses, which were built by the company itself for this express purpose. With a range of over 300 kilo­metres, the Moia +6 minibus can negotiate an entire shift without recharging. One such vehicle is just turning onto Ferdinand­strasse, where we are waiting at the predetermined stop: for logistical reasons the vehicles don’t stop on every street corner or at every door but instead only at virtual bus stops, which passengers should never have to walk more than 250 metres to reach. And, sure enough, we have only had to walk for 150 metres to get to ours. As the name painted on the golden-yellow seven-seater reveals, our Moia answers to the name of Elisa. Another passenger is already on board, a laptop open on his knees with lines of code flickering on the screen – offering a handy real-live glossy advert for Moia in the process. Something else also becomes immediately apparent: this smart shared taxi service is seeking to put clear blue water between what it offers and the enforced communication you have to put up with on the overly-cosy rear seats of the cars run by BlaBlaCar and the like. The roomy interior has a wooden floor, and the look and leg room of the comfortable seats are reminiscent of what you would find in the first-class compartment of an InterCity express. Headrests with pronounced wings are intended to guarantee privacy, and free Wi-Fi and USB connections ensure that your digital devices won’t run out of juice or connectivity for the duration of the journey. And, just like in a train, a screen shows the route and the next stops. The identities of the passengers who need to disembark at the next stop are revealed by initials after the stop name. For us, there are another 10 minutes to go to Berliner Tor.

“The first week was crazily busy,” the driver tells us. “We were literally out around the clock.” Moia’s official statistics speak of 15,000 bookings in the first ten days - more than could possibly be catered for with just 100 vehicles. One reason - along with its desire to expand its operative territory - why the company is seeking to quickly increase its fleet. The aim is for the buses to be covering pretty much the entire city, from Volksdorf to Blankenese and from Langenhorn to Hafencity, by September; the number of drivers is set to increase from its current level of 400 to 1000.

The calculation behind these growth plans isn’t rocket science: The more vehicles are on the streets, the better able they will be to accommodate all the journey requirements and the less time the individual customers will need to wait - due to the fact that either a shuttle or a customer with a similar destination will be close at hand. And the more the journeys are shared, the better the capacity of the minibuses will be utilised, meaning that it will be worth the provider’s while to run them. Although the procurement costs for the shuttles may be lower than those of a classic city bus, any one driver can carry only six passengers at a time instead of 100. And, because the drivers are employed by Moia, unlike in the taxi trade, it doesn’t make financial sense for the company for them to ferry one single passenger to his or her destination. Our driver lets us out at Berliner Tor after just a slight delay. Between the two of us, we have paid just five Euro for the 2.3-kilometre trip. An introductory offer with which Moia is seeking to target customers. During normal operations, the average cost of one journey per person will range from five to ten Euro. If you book other people on at the same time, it will cost them less.

Moia is not the first and only provider to have taken this idea out onto the road. Transport providers Uber and Lyft have been running such services in places like New York and London for quite a while. In the Hamburg suburbs of Lurup and Ohlsdorf, for the price of a standard public transport ticket plus a small surcharge you can get into any one of the 20 electric taxis run by ioki and be taken to your next stop. ioki is a subsidiary of Deutsche Bahn. DB also owns a majority stake in the ride-sharing start-up known as CleverShuttle, which operates 50 electric and hydrogen-fuelled vehicles in Hamburg. Alongside Hamburg, CleverShuttle also operates in six other German cities, including Munich, Leipzig and Frankfurt am Main. The start-up launched in Berlin in 2016 with just ten vehicles: it now has 30, with short-term plans for five times that number. The authorities in Berlin gave the go-ahead in March for CleverShuttle to increase its fleet to 150 vehicles, a target which the company intends to achieve by October.

CleverShuttle is also responding to the new kid on the block, BerlKönig - the smart taxi service launched in the capital in September 2018 by Berlin’s public transport company, BVG, in concert with Daimler subsidiary ViaVan. Successfully, it seems: anyone out and about on the streets of Prenzlauer Berg will get the impression that the black vans with the BVG camouflage paintjob are always heaving into view. And where potential passengers initially had to wait 20 minutes for the next lift and would sometimes not get a lift at all if it was raining, they often now find themselves getting into the next shuttle after just a few minutes.

According to the Senate administration, the minibuses get booked nearly 2000 times a day. Translating into a total of 340,000 trips in the first six months. According to figures released by the Senate, the BVG is operating 132 vehicles, 68 of which are fully electric; the target total is 300 shuttles. However, there’s still potential to utilise the capacity even better: the minibuses drive around empty for about 40 per cent of their operating hours. And yet, in January 69 per cent of the trips were shared between two or more passengers.

However, the smart taxi services haven’t always met with joy unconfined. In Berlin, criticisms have been forthcoming from the taxi industry and political circles. As Tino Schopf, transport spokesman for Berlin’s SPD party, put it in a damning indictment in an interview with local broadcaster RBB, BerlKönig in its present form was “the cannibalisation of public transport and Berlin’s taxi trade”. Instead of filling in transport black holes in the outlying districts as originally announced, he went on, BerlKönig was operating solely in the centre of the city. A further problem seized on by the SPD politician was that some 60 per cent of the passengers would take buses or trains or go by bike if the service were not available. These are positions not shared by the BVG, which sees BerlKönig in the first instance as an experiment and a way of filling the gap between buses and taxis that will not tread on the toes of either. BVG spokeswoman Petra Nelken told the TAZ newspaper that taxis operate in another segment. “If I’m all dressed up for the opera or need to get to the airport quickly, of course I’m going to take a cab rather than go by BerlKönig,” Nelken said. The smart taxi services are indeed largely unsuitable for urgent journeys. Because the shuttles take detours to pick up or drop off other passengers, you do in some cases have to wait longer for them and be ready to put up with a longer journey time than you would in a taxi. Nor does the BVG deem the digital on-demand buses to be a threat to its own services; on the contrary, it considers them to be complementary. “We’re of the view that BerlKönig will make public transport more attractive to people,” BVG spokeswomen Nelken explained.

Whether ride-sharing services are actually easing traffic problems or instead making the roads even busier is still the subject of heated debate. No reliable studies have yet been published - the services are simply too new. Studies which prophesy an increase in road traffic refer primarily to taxi-like platforms such as Uber, which offer sharing only as a by-product. And yet, the conclusions for Germany of the “Report Mainz” programme make, if anything, for sobering reading. Reporters from TV channel ARD took cameras on board Moia shuttles in Hanover and their allygator equivalents in Berlin. Nearly all the passengers told them that they would otherwise take buses or trains. This is, of course, hardly representative. And ioki arrives at somewhat different conclusions in Hamburg. The project was scrutinised by scientists from the Technical University of Hamburg (TUHH) for a period of three months. What the transport experts found was that, if it hadn’t been for the service, over 15 per cent of the customers would have taken their own cars. According to ioki, every electric taxi carries an average of 1.74 persons. By way of contrast, the figure for private cars is 1.47. “Our plan to come to the aid of local public transport has been vindicated: half of our passengers want to be taken to bigger public transport stops,” says ioki CEO Michael Barillère-Scholz.

This is a promising interim result, albeit one which can’t simply be applied to other ride-sharing providers. After all, unlike ioki, these have to date tended to focus on city centres, where the density of public transport is uneven, encouraging the emergence of competition. But BerlKönig and Moia are not just being left to their own devices. The on-demand service in Berlin and its role in the transport mix are subject to regular evaluation and the findings shared with the Senate. And Moia’s impact on traffic and mobility patterns in Hamburg is being scientifically documented. After two years, an interim evaluation will be published. The results of this assessment will be crucial in determining whether Moia will be permitted to increase the size of its fleet.

After all, every single ride-sharing provider is still in a trial phase. Germany’s public transport law does not allow for the operation of such transport services. Hire cars - which they are currently classed as - may not be shared with other users and must return to base if no follow-up trip has been booked. The ride-sharing services may operate only by the grace of the experimentation clause. This permits a test phase of no more than four years which requires the consent of the local authority and cannot currently be extended. Federal minister of transport Andreas Scheuer (CSU) has announced a review of the law by 2021. The amendment is intended to make it easier to gain consent for the shuttle services and to put them on a proper legal footing.

But this is a plan to which the taxi industry has intensified its opposition. At the beginning of April, hundreds of taxi drivers staged go-slows in several German cities, thereby bringing the traffic to a standstill. And the industry has also turned to the law in its efforts to see off its ride-sharing competitors: one taxi company succeeded in rushing a suit through the Administrative Court in Hamburg to provisionally bar Moia from operating more than 200 buses in the city. No definitive ruling has been forthcoming, and the process could drag on for several months. Moia and the Hamburg transport authorities intend to file an appeal with the Higher Administrative Court against the provisional ruling of the lower court. However, an emergency petition against CleverShuttle was rejected by the Administrative Court. The court found that the 50 CleverShuttle buses did not represent a significant threat to the revenue of the taxi company.

Some local authorities, too, however, are increasingly imposing limits on the providers’ growth plans. In Stuttgart, for instance, CleverShuttle was forced to accept a setback. The city rejected its application to increase its fleet from 15 to 100 on the grounds that it would jeopardise the city’s public transport and taxi businesses. In Berlin, Moia’s application to launch with 1000 vehicles was flatly rejected. According to the Senate Administration, the emergence of a third provider alongside BerlKönig and CleverShuttle would threaten the fundamental pre-eminence of buses, bikes and pedestrian traffic. The Senate added that it was seeking to work with the existing providers to come up with “reliable findings concerning the impact on private car use, public transport and the taxi trade”. Meaning that Moia was forced in the first instance to put its golden-yellow buses on the road in other cities. How things progress with smart taxi sharing and how it will change the transport landscape in the metropolises will come to light in the next two years.