Several Bay Area Transit agencies have recently experimented with offering on-demand bus services targeting suburban areas with traditionally low transit ridership. AC Transit, VTA, and SamTrans have each rolled out pilot programs providing “flex” services over the past year, primarily as a first/last mile connection to rail stations. Much like Uber or Lyft, passengers would call these on-demand services through a mobile app and be able to travel point to point within a given service area. On-demand service has traditionally performed poorly for ridership and cost compared to fixed-route services; however, these agencies have hoped that technology could provide the missing piece in serving areas with low demand for fixed-route service.
However, the Bay Area’s latest wave of on-demand services has largely failed to attract transit riders. Ridership on AC Transit’s Newark service and SamTrans’ San Carlos service has averaged only about two passengers per hour. For SamTrans, this translated to an operating cost of nearly $100 per passenger, significantly higher than its systemwide average cost of $6 per passenger. Like dial-a-ride services, the productivity of Flex services has been limited by a lack of demand density, frequency, and pubic awareness. As a result, both SamTrans and VTA have already discontinued some or all of their Flex service programs.
Few transit agencies are able to reach the necessary scale needed to serve a critical mass of passengers while keeping costs reasonable. For SamTrans, a typical fixed route bus picks up a passenger every two minutes, and it costs over $200 per hour to operate a bus (driver wages and benefits, as well as bus maintenance and fuel). It’s nearly impossible for on-demand services to match fixed-route services, especially when ridership potential is limited to begin with in suburban areas like Newark or Castro Valley – it’s no wonder that UberPool and LyftLine services are also less concentrated in such areas. Cities such as Centennial, Colorado are increasingly looking to collaborate with Uber and Lyft to develop flexible services with a higher concentration of service and lower costs, but it remains to be seen if such on-demand services can pencil out.