You may think of services like Lyft, Uber, and Bolt as taxi companies of the modern age, but they are actually ridesharing services, and this is an important distinction. Furthermore, they are not the only major companies in the industry, as there are dozens of other successful ridesharing services with an international presence. If you are still confused about the whole concept of ridesharing, fear not, as we will provide some insights into the practice.
What is ridesharing?
Ridesharing is the commercial successor to carpool. In carpool, a group of people would agree to travel a route together in one vehicle for the sake of convenience and saving cost. In most cases, carpoolers know each other well and travel together to work or social events. On the other hand, ridesharing is not focused on friendships or familial ties but strives for the same purpose – transporting a group of people together to one or more locations.
Unlike taxis, rideshare drivers are rarely directly employed by a company, but rather act as independent contractors fulfilling the company’s services. Thus, users looking for a ride can order a car through an app or web interface, so that the driver takes them to a destination for a set price, having the choice beforehand on whether to take an order in their vicinity.
Benefits of ridesharing
Ridesharing has become quite popular over the past 10 years due to the number of benefits it provides. First and foremost, it is generally less expensive than a taxi service, and the payment can be conducted by a credit card. Secondly, it is superior to traditional carpooling because rides can be ordered at any time of the day when there are drivers available in the vicinity. Instead of wondering where your driver is and what time you will set off, ridesharing services usually let you see the location of the driver in real-time as they head towards your location.
One of the biggest benefits of ridesharing is its environmental impact. As there are multiple people headed towards a single destination in one car, carbon emissions are reduced. There are fewer cars needed to make the trip for the group, and fewer cars on the roads in general. In large cities with traffic congestion issues, ridesharing services are becoming a game-changer in allowing for easier and faster travel.
Challenges of ridesharing
While taxis have been around for over a century, ridesharing is a relatively new service, so it has faced some hurdles throughout the world. One of the biggest challenges is legislative: taxi companies and governments of different levels have pushed back on ridesharing as an unregulated business, or even criticized it as an unofficial form of taxi. Despite the pushback, ridesharing continues to grow in popularity and eat into the market share of the taxi industry.
Another major challenge of ridesharing is its small presence in rural areas. Given that densely populated areas like cities have plenty of people in need of driving arrangements, it is only natural that they serve as the center of ridesharing business activity, leaving rural areas with a smaller share of drivers. Still, as the services grow in popularity, so too can their presence in more sparsely populated areas.