No More 1-star Ubers: a New Model of Ride-share Is Here
| Publication year | 2020 |
No More 1-Star Ubers: A New Model of Ride-Share Is Here
Eric Craft
It is Monday morning in the year 2040, and you are on your way to yet another day of work. You went to sleep early and did not finish preparing a presentation for later this afternoon. You hop in your car, tell it to "go to work," and your car begins to drive itself. Before you owned a fully autonomous car, you dreaded the hour commute with traffic every morning. However, now, this hour is a great time to sit back, relax, and do work or maybe even take a nap if you did not sleep well. Everyone around you is doing the same thing. There is not a worry in the world right now because your car brakes every time the car in front of it is getting too close, as it constantly scans its surroundings. It does this through its various sensors and cameras that scan the environment around it.
Your workplace is about five miles off the highway, so your car exits the highway onto a three-lane local road surrounded by the forest. Your car is in the middle lane. To your left, there is a school bus full of children. To your right, there is an elderly couple driving their old 2018 Chevrolet. All of a sudden, multiple deer run in front of your car. Your car has three options because there is no time to stop before hitting the deer: (1) hit the deer; (2) swerve to your left to avoid the deer, hitting the school bus; or (3) swerve to your right to avoid the deer, hitting the elderly couple. A human driver, if aware of their surroundings, would probably choose option 1. However, does your car have the same ethical framework as you—valuing the life of human beings higher than an animal? What will your car do?
This Comment proposes a change in the ride-share business market toward embracing autonomous vehicles while also carefully leveraging practical concerns against state laws and technological limitations. Specifically, companies such as Lyft, through its partnership with Aptiv, have demonstrated the benefits of autonomous vehicle ride-share, but it has not been free of problems—both legal and practical.
While still a relatively new technology, autonomous vehicles have taken off in popularity in recent years. Major motor vehicle and technology companies, such as Ford and Google, have put money and time into developing them. After companies like Tesla have worked to make autonomous vehicles common in everyday life, the need for driverless technology in other areas, such as ride-share, became apparent.
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The ride-share industry has a lot to gain by embracing new driverless technology, and the potential to address and fix problems that plague human driving in general has a lot to lend to the ride-share industry. The need for change is clear considering increases in car crashes due to human error, the constant push for fuel efficiency, and the goal of reduced traffic congestion. Nonetheless, changes are needed not only for safety matters, but also for more practical concerns. The emergence of self-driving cars will allow people who were unable to drive cars because of a disability or age to have a reliable method of transportation without posing as a danger on the road to society. With the ride-share platform becoming more common across the country, autonomous vehicles will have the potential to change the face of the ride-share industry.
Driverless technology has improved and developed considerably in recent years. Improvements ranging from more complex GPS navigation systems to intricate laser sensors that detect other cars on the road and a vehicle's general surroundings have made it possible for companies like Tesla to manufacture and sell fully electric, self-driving cars to the general public.1
While driverless technology has developed considerably in recent years, it does not come without problems. Tesla systems have had many issues of recognition, resulting in numerous crashes. Further, as highlighted in the scenario above, the question of how self-driving cars will respond to ethical issues is a large unknown. Removing the human element will certainly reduce many dangers on the road, but it will also create dangers in themselves. We will never get rid of the human element entirely, because there may always be a child crossing a road when they are not supposed to, a dog chasing a ball onto the street, and many more scenarios that will force the car to make critical ethical decisions. Sometimes, this means choosing the best worst option.
Several states have enacted laws addressing the growing autonomous vehicle industry. At the forefront of those developments, Nevada was the first state to enact such laws and is widely regarded as the pioneer state for autonomous vehicle legislation.2 Such legislation makes Nevada a safe haven for many autonomous vehicle companies to develop and test technology.3 For example,
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Lyft has teamed up with Aptiv to provide autonomous vehicle ride-share options to riders in Las Vegas under the Nevada statutes.4
The burgeoning autonomous ride-share business model must adapt to the practical concerns and demands of autonomous vehicles while also operating within the confines of the law, which is largely state-specific. For instance, the traditional ride-share business model of depending on drivers as independent contractors who provide the car and perform the service—driving—will no longer be relevant in the future. Instead, ride-share companies will likely have higher overhead costs because they will have to purchase the autonomous vehicles or contract with an operator of autonomous vehicles, like Aptiv, and be exclusively responsible for ensuring their safety and efficiency. In addition, because there will no longer be a need for actual human drivers, the very heart of what we now know to be the face of ride-share, the drivers, will shift to a more corporate-focused image. While it is too early to tell whether that will be positive or negative, the fact of the matter is that the ride-share industry cannot embrace autonomous vehicle technology without essentially turning its entire business model upside down.
This Comment, in Sections II and III, discuss background matters relating to the ride-share industry as it currently operates and identifies the factors that demonstrate the need for change in light of advances in autonomous vehicle technology. Section IV discusses driverless technology, including its origins and where it is likely to go in the future. In Section V, this Comment outlines the benefits of the ride-share industry embracing driverless technology by explaining why ride-share companies should evolve their business model. Last, Section VI concludes by summarizing where the ride-share industry should evolve considering improvements in technology and proposed changes in law.
Ride-share companies have become more popular every year. They are so popular that some taxi companies have gone out of business.5 The ride-share business model consists of independent contractors as drivers. However, with fully-autonomous cars emerging, their business model could become even more
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efficient. The human element of ride-share has led to many problems, especially criminal activity and accidents. Technology is extremely advanced with fully-autonomous cars and is on the rise. While this does not come without new issues, there are many benefits to an increase in self-driving cars on the road. This section examines the business model of ride-share companies, looks further into the "human element" of ride-share, explains the need for driverless technology, and details current driverless technology.
A. The Ride-Share Business Model
Some of the biggest and most rapidly growing businesses are ride-share companies.6 With just Uber alone, there are fourteen million trips completed every single day on average.7 This adds up to over five billion trips per year.8 Lyft is smaller than Uber, occupying about 35% of the market share for ride-share companies.9 In 2017, Lyft operated about 375 million rides.10 Uber and Lyft are still fairly new: Uber was founded in 2009 and Lyft in 2012.11 This is all the more impressive because the ride-share business is becoming more popular every year and has already grown humongous in the small time frame they have been around.12
The typical modern ride-share business model is similar for most companies, including Uber and Lyft.13 Both feature on-demand service that connects riders with drivers who are independent contractors.14 Specifically, riders use a smartphone app to select their destinations and then "hail" a ride-share driver chosen by a formula.15 After a rider calls a vehicle, the connected driver has the
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option to either accept or reject the ride; if the driver accepts the ride, then the driver's details are displayed to the rider and the driver proceeds to pick up the rider.16 The touchstone of the ride-share business model, as it currently operates, is that the companies strive for for less ownership.17 The ride-share companies do not own the cars - the drivers do - thus cutting overhead costs significantly.18
As independent contractors, ride-share drivers are not employees, but instead are their "own bosses."19 This comes with several benefits, according to the Associate General Counsel at the National Labor Relations Board, Jayme Sophir:
Drivers' virtually complete control of their cars, work schedules, and log-in locations, together with their freedom to work for competitors of [ride-share companies], provide[] them with significant entrepreneurial opportunity. On any given day ... [ride-share] drivers [can] decide how best to serve their economic objectives: by fulfilling ride requests through the App, working for a competing ride-share service, or pursuing a different venture altogether.20
As to its drivers' status as independent contractors, Uber stands behind the practice...
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