Local transit agencies mimicking Uber and Lyft are seeing big ridership gains

This story is republished from Minnesota Reformer. Read the original article.

With fewer people commuting and ridership still climbing out of the pandemic-era hole, some local transit agencies are mimicking the success of Uber and Lyft, operating their own similar services in the hope of serving transit users in new and more convenient ways. 

Andrew Landon, who uses a wheelchair, recently spent a half an hour on his laptop at the Burnsville Transit Station waiting for a version of this service called Connect to take him home. Connect is Minnesota Valley Transit Authority’s Uber/Lyft-style service that takes riders from point A to point B, instead of using regular routes, in low-density areas. 

These services have recovered beyond their pre-pandemic ridership. Connect is so popular that it’s having trouble keeping up with demand, even as the Legislature allocated over $9 million last year to build out Connect and similar systems statewide. 

Landon prefers using Connect over Metro Mobility — the Metropolitan Council’s dial-a-ride service for the elderly and people with disabilities — because it allows him to live more spontaneously. “With Metro Mobility, I have to know a day in advance when I need to leave downtown. With the (MVTA Connect) buses, I don’t,” Landon said. Metro Mobility is hard to rely on because it is plagued with delays, he added. 

What is Microtransit?

Microtransit is much like Uber and Lyft. A driver, dispatched by a computer, shows up in minutes (or as long as an hour) to take riders where they want to go. (This is different from dial-a-ride services like Metro Mobility and Transit Link, which require users to call ahead days in advance to schedule a ride.) Southwest Transit debuted the first microtransit service in the region, called Prime, in 2015. 

But microtransit services differ from Uber and Lyft. Unlike those ride hailing apps, you can call a real live person to get a ride if you don’t have access to an app or a smartphone. And the ride that shows up won’t be a sedan. It’ll either be a big van or a bus grafted onto a truck. The vehicles are more likely to be wheelchair-accessible. In the case of Connect, you can board it without a reservation as it’s stopped to pick up or discharge a passenger, just like you would a regular bus. 

Microtransit services also tend to be cheaper than Uber and Lyft and offer more payment options. When you board, you can pay the $2.50 to $5 fare with a bank card, through the app, or give the driver cash directly. Two services, Prime and Metro Transit’s micro service serving north Minneapolis, accept the region’s low-income discount fare program. Some services offer transfers to regular buses. Though most microtransit services don’t accept the regional Go-To card, some of the providers are working to address that. 

Unlike Uber and Lyft, you may share a ride with others. The services also do not operate 24 hours a day and are restricted to a certain area. MVTA’s service, for example, operates two separate zones: one that just serves the Dakota County city of Eagan, the other serving Burnsville, Savage, Rosemount and Apple Valley. Both run seven days a week.

The microtransit drivers are not independent contractors. They are W-2 employees of a private company contracted to operate the service. They may also be paid better than rideshare drivers, as well as subject to more stringent background checks and random drug testing. Drivers who work the Southwest Prime and Plymouth Click-And-Ride services are unionized. 

Depending on where the service operates, transit agencies may have to spend more per mile to transport riders compared to regular bus routes. In north Minneapolis, Metro Transit’s micro service cost $8.80 per in-service mile to operate for the first seven months of 2023. In the pilot’s first year, it transported an average of 182 daily riders. Compare that to Route 14, which operates in the service area on West Broadway Avenue and Golden Valley Road. In 2021, Metro Transit spent $1.94 per mile to transport 3,219 average weekday riders. 

Public rideshare apps appear to be more cost-effective for transit agencies in the suburbs. Southwest’s Prime service cost $4.43 per in-service mile to operate and transported an average of 396 daily riders for the first seven months of this year. Compare that to their downtown Minneapolis express routes for the same period, which cost $7.17 per in-service mile to operate and transported an average of 668 weekday riders. 

The microtransit services are recovering faster than the region’s existing fixed-route services. Southwest Prime had 584 average daily riders in August 2023, about 146% more than average daily ridership in August of 2019. Plymouth’s Click-And-Ride service, which was converted from a dial-a-ride service to a microtransit service in 2019, recovered over 100% of its monthly pre-pandemic ridership for the first time in September 2021. September 2023 ridership for the service was 3,982, or 137% of its September 2019 ridership. Maple Grove’s My Ride service isn’t far behind, with 2022 ridership recovering to 99% of 2019 levels.

Meanwhile, just three weekend bus routes in the region, all of which are operated by Metro Transit, have recovered at least 100% of their pre-pandemic ridership with minimal route alignment changes. Metro Mobility and Transit Link are recovering slower. As of October, Transit Link, recovered 52% of its year-to-date 2019 ridership. Metro Mobility, on the other hand, has recovered 87% of their year-to-date 2019 ridership.  

A Met Council spokesperson says services like Metro Mobility has been slower to recover because ridership patterns have changed. Experts agree, as they’re seeing more workers who have previously used these services working from home.

Experts also believe people in urban and suburban areas may be less interested in scheduling a ride ahead of time. “When an ADA paratransit customer has a choice … the on-demand feature is pretty attractive,” said Will Rodman, research scientist at the Texas A&M Transportation Institute.

Keeping Up

Agencies, waiting for transportation sales tax proceeds, are struggling to keep up with increasing demand. To manage demand, MVTA only allows riders to book rides up to three hours ahead of time, while also cutting some regular bus service in September to ensure they have enough drivers to provide the service in their existing areas. (They’ve restored some of that service in December.) 

Both MVTA and Southwest Transit want to expand their service areas, but are struggling to hire enough drivers. The supply of microtransit buses is at the mercy of manufacturers, which have been focusing on building RVs and delivery vehicles. This coming year, Southwest Transit plans to replace the microtransit service serving I-494 between Eden Prairie and the Mall of America with a fixed-route service, a move that they expect will save them $80,000 annually. 

Metro Transit, meanwhile, increased fares on its micro service in December, owing to the fact that two-thirds of rides were completed faster than what regular buses could have offered. And for six months in 2023, Southwest allowed its riders to hail a Lyft through their app. Through August, close to 1,900 people took advantage of the service, where Southwest paid the first $10 of riders’ Lyft fare.

Partnering with transportation network companies such as Lyft is also something MVTA is looking into, Chief Operating Officer Matt Fyten said. But they don’t intend to use Lyft as an excuse to not hire more drivers. “If we want to expand MVTA Connect, we have a certain brand and level of service that we want to maintain. We feel we can best do that with our drivers that are part of the MVTA Connect service,” said Fyten, who implemented the Lyft program as chief operating officer at Southwest Transit shortly before he left to take on the role at MVTA last year. 

Microtransit’s record in greater Minnesota is mixed: A Grand Rapids service doubled ridership in its first year, while another in St. Cloud struggled to recover pre-pandemic ridership. 

Still, the Legislature last year gave outstate microtransit a key boost, allocating $250,000 over the next two years for the city of Rochester to deploy a microtransit program using electric vehicles. And the Minnesota Department of Transportation secured $1.9 million in federal grants for a one-year pilot to allow riders in greater Minnesota to plan, pay for, and ultimately summon rides through a mobile app.