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Lyft and Uber serve low-income communities better than taxis, says study

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A major transportation equity study in LA reveals how far the taxi industry—once the only option for car access—has fallen

Taxis used to be the best option for car access in low-income communities, but ride-hailing companies are closing the gap.
AP Photo/Reed Saxon

For years, taxis have served as an affordable, reliable mobility option for people who don’t own cars. Now ride-hailing services like Lyft and Uber are providing better vehicle access to low-income communities, according to a new three-year study that looked at transportation equity in Los Angeles.

The same study also revealed discriminatory practices by the taxi industry, including dramatically increased wait times and ride cancellations for black riders in particular.

“For so many decades, taxis were the only way to get car access for people who didn’t have it,” says study author Anne Brown, who holds an urban planning doctorate from UCLA’s Institute for Transportation Studies. “A lot of people really want to make Uber and Lyft the bad guys in this, but my study finds that while there is still a gap between black and white riders, it’s so much better than the appalling state of our taxi industry.”

As part of her study—“Ridehail Revolution: Ridehail Travel and Equity in Los Angeles”—Brown recruited 18 of her fellow UCLA students to summon 1,704 trips using Uber, Lyft, and local taxi companies for two months in 2017. The students were aged 20 to 30 and represented a wide range of ethnicities. Brown even gave the students instructions on how to dress similarly so the only visible difference between riders was their race.

The number of trips cancelled in the study compared by service and rider characteristics.
Anne Brown

The taxi data was troubling. For all riders, regardless of ethnicity, 10 percent of taxis did not arrive within one hour. But taxi rides were 73 percent more likely to be cancelled for black riders, and black riders waited 52 percent longer to be picked up. A full 25 percent of black taxi-hailers—one in four—were never picked up at all.

Two black males reported being asked for cash up front by the taxi driver. “That’s illegal,” says Brown. “That’s the definition of discrimination.”

Comparatively, even though Uber and Lyft trips showed a slightly higher cancellation rate for black riders compared to white riders, as Brown notes, there was no effective difference because it was within the margin of error.

Since launching almost a decade ago, ride-hailing startups have settled multiple discrimination cases, including a class action suit brought against Uber by New York City riders with disabilities. A similar study conducted in Seattle and Boston in 2016 found wait times and cancellations were higher for black riders using Uber and Lyft compared to taxis. Both companies have since implemented zero-tolerance discrimination policies.

“We’re proud that Uber has improved access to transportation in historically underserved communities and reduced the potential for discrimination,” an Uber spokesperson tells Curbed. “While there’s more work to do, we are committed to serving all communities around the world.”

“We are proud of the advancements Lyft has made in expanding access to transportation for passengers from all walks of life, and particularly from historically underserved communities,” says a Lyft spokesperson. “However, no incident of discrimination is acceptable, and we are building systems to detect these incidents.”

One key to eliminating discrimination might be in the way rider information is delivered, says Brown. “I don’t know what goes on in driver minds, or the motivation behind cancelling rides,” she says. “But the drivers learn about rider information at different times of the trip.” Lyft provides name, location, star rating, and photo before the driver accepts the ride, while Uber only shows a location and star rating, then provides a name after the ride is accepted.

In comparison, taxi services may give the driver a name before accepting the ride, but because taxis are most often hailed by voice call, another person—the operator—is also making a separate decision about how and when to dispatch the ride, introducing a second opportunity to discriminate.

Plus, without in-app vehicle tracking to provide accountability, some taxis might drive away after visually spotting the rider, which at least one black rider in Brown’s study reported happening. (Although there are taxi apps available in LA County, only nine percent of taxi rides are hailed that way—plus the riders in Brown’s study said the apps didn’t work well enough to use them.)

Taxi riders in the study also felt they had no customer rights when things went wrong. Many reported credit card machines not working in cabs, so they were forced to pay cash. One rider tried to call the taxi company to file a complaint and was told that the person who handled complaints was not available. “Accountability mattered to them,” says Brown. “With Uber and Lyft, they could ping the companies and they’d give them their money back instantly.”

While technological fixes might address some of these concerns, LA’s taxi industry in general faces much greater challenges, says Eric Spiegelman, president of LA’s taxicab commission, who learned of the study’s results as part of a presentation Brown made to the commission.

“Ride-hailing services have always averaged much shorter wait times than Los Angeles taxicabs. This is no secret,” says Spiegelman. “There are also far, far more ride-hailing vehicles serving Los Angeles than there are taxicabs. This means there’s a much greater chance that an Uber or Lyft is nearer to you than a taxi at any given moment.” The only place this isn’t true is at airports, he notes, which is a policy choice—taxis are allocated space to queue within each terminal while Uber and Lyft’s vehicles must wait off-property until they are summoned.

While LA’s Department of Transportation regulations establish service guidelines, including having credit card machines in cabs, says Spiegelman, “at the end of the day it’s up to the taxi companies to provide a positive user experience for their customers.”

Brown’s insight about the taxi app experience was especially startling, says Spiegelman. “The word she used to describe them was ‘unusable.’ The apps either crashed, or showed that no cabs were available, or caused taxis to drop passengers off in the wrong place, or overcharged the passengers.”

Spiegelman says the commission has proposed ways to make taxis more competitive on price or increase the number of cabs on the road, but drivers have objected. “If they embraced innovation in a truly meaningful way, I think you’d see this city rally around them,” he says. “They still provide an essential service to Angelenos who don’t have cell phones or bank accounts, who are excluded from the Uber and Lyft experience. But if the local taxi industry wants to achieve mass appeal in this new world, nothing short of radical change will do.”

While several high-profile taxi driver suicides blamed on the taxi industry’s financial instability have spurred advocates to call for stricter regulation of ride-hailing services, Brown says the better solution would be to appropriately charge owners of private cars to use—and park on—city streets by introducing solutions like congestion pricing. “One thing we often forget is how inexpensive it is to drive.”

But Brown would like to see ride-hailing companies be more forthcoming about their own operations—especially since ride-hailing has been cited as a factor in declining transit ridership and increasing numbers of vehicles on roads.

Brown was the first scholar in the country to get access to Lyft’s trip data, which is not made public for privacy reasons. Research institutions are now working as neutral entities between ride-hailing companies and cities to keep the data confidential and share findings with policymakers. This dataset in particular uncovered some valuable information about who Lyft’s rides are serving.

A full one-third of the 6.3 million Lyft trips taken in LA during 2016 were pooled Lyft Line trips, which, in addition to being cheaper for riders than taxis, theoretically help reduce congestion and emissions. Brown also observed that these shared rides were much more popular in low-income neighborhoods. “Certainly these more price-sensitive groups are finding more value in these affordable trips,” she says. Taxis don’t offer a similar way to pool rides besides passengers simply splitting a fare.

This data also showed that Lyft provided service to virtually all LA’s neighborhoods—serving 99.8 percent of Los Angeles County’s population—while several other studies have shown how taxi drivers avoid low-income neighborhoods. “This raises the question of whether ride-hailing services can improve car access, and do so equitability, where taxis have failed,” says Brown. “This research suggests that at both the neighborhood and individual level, the answer is ‘yes.’”

This news was especially promising after a recent UCLA study pinned the region’s declining transit ridership and growing vehicular congestion on an increase in car ownership—including among lower-income groups that previously relied on transit. Providing affordable, equitable car-access like this study demonstrates could become a good alternative to expensive, congestion-inducing car ownership.

Recent changes to Uber and Lyft’s apps that allow potential riders to see multimodal options like transit and bike-sharing services alongside vehicle-hailing could also help riders save more money.

Brown believes ride-hailing companies can be used as a tool to improve transportation equity as well as reduce congestion by matching low-income riders with more shared rides. The use of prepaid, subsidized passes could serve riders who don’t have credit cards, and ride-hailing could be integrated as part of an on-demand service to help people get to and from transit.

Although the study is specific to LA, it does illustrate a big opportunity for all cities. If ride-hailing services can be nimble enough to offer equitable, affordable car-access to all residents as needed, it may help prevent the purchase, extra mileage, and negative environmental impacts of more vehicles, says Brown. “These services do have the potential, in the long run, to reduce car ownership.”