The Lyft Future

A couple of months ago John Zimmer, the co-founder of rideshare company Lyft, wrote a white paper titled “The Third Transportation Revolution” (medium.com/@johnzimmer/the-third-transportation-revolution-27860f05fa91#.1zymdbpvn). The vision is an indictment of the century-old car ownership model and suggests most Americans will no longer own cars 10 years from now—an amazing statement by itself, but also because General Motors invested $500-million in Lyft. 

Zimmer’s partner, Logan Green, the CEO of Lyft, actually has a background in transportation, while Zimmer studied hospitality in college, but took some urban planning classes. Both have more experience in transportation together than Travis Kalanick, the founder and CEO of rival Uber, but it doesn’t seem to have mattered as Uber is way in front of them.

In the paper, Zimmer makes three main points. The first says autonomous vehicle fleets will account for the majority of Lyft rides within five years. That’s exciting if not a bit hard to believe. Then, after mentioning the high cost of car ownership, inefficient use of land in our cities for cars, and the massive coming cost to fix our nation’s roads, Zimmer states, “by 2025, private car ownership will all but end in the U.S. cities.” Wow! That’s only eight years from now!! 

How many cars actually are going to be traded in for shared autonomous “taxi” services? Are we talking about 30 percent of American’s cars? If so, that would be roughly 27-million cars that need to be destroyed, turned into housing for the homeless, or otherwise deployed. But the paper suggests it’s going to be most all of our cars. I have no idea what we are going to do with so many end-of-life cars.

Uber and Lyft currently have a small portion of the U.S. consumer transportation market. They are strong in our city centers. But out in the suburban areas, they carry party goers, do airport runs, and are beginning to link-up with public transit networks. I don’t doubt autonomous Uber and Lyft rides are going to be highly disruptive. But I wonder if this conversion of car owners into mobility users isn’t far more complicated than Zimmer indicates?

GM was an interesting choice for a partner. Zimmer’s estimates indicate all of GM’s U.S. dealer network will be wiped out in the not-too-distant future, unless they will convert in some manner to serve some new role for GM. Reading between the lines, it seems GM president Daniel Ammann is the champion of the Lyft deal. He comes from Wall Street and has worked directly in the automotive business for only six years. I wonder if a more seasoned automotive executive would have made the same large investment in Lyft.

I find it interesting every rideshare leader who describes the future of mobility mainly describes a world comprised of autonomous cars all the same size as our cars of today. We have over one-billion cars, they are pretty much all the same size, and it’s a monoculture. This made sense in the ownership era, but no longer for the Mobility-as-a-Service (MaaS) future. For example, why would all the vehicles operating in the center of Chicago all be designed for high-speed freeway travel like today? How can vehicles be optimized through design for this future?

I agree America will look a lot different when we destroy 50-million cars. But for Zimmer and Lyft to really get Americans to fall out of love with their cars, I expect they will need to form a collation of some sort to re-educate American transportation consumers, and should focus on how much cars today really cost a household would be a good place to start. (The AAA average cost of car ownership for a household with two cars equals $50/day. I think few consumers understand it’s that high).

“The Third Transportation Revolution” is a good paper. But for me, what we are heading into is not a “Transportation Revolution.” It’s the future of transportation for sure, but also what Google, Facebook and other massive tech companies are about: connectivity. The world of mobility (physical movement) and connectivity (virtual connection) are all about one thing mainly, and that’s ACCESS. We are heading into a new Access Revolution!

I remember seeing a big newsflash come over my computer in 2012. General Motors’ OnStar had invested in peer-to-peer start-up RelayRides. The press release talked about how all the General Motors cars would now support carsharing. I thought to myself that the problem with that is that too few Americans knew what carsharing is, to say nothing of actually knowing how to do it. It reminded me of a company that built swimming pools overnight across some country where nobody knows how to swim, or has swim suits. Fortunately, times have changed and I have no doubt Lyft and GM are poised to finally get real traction in the intelligent mobility space.