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Do private high-tech commuter buses jibe with public transportation?

Published April 12, 2015 on CNET News

What sold Matt Lee on the latest transportation startup was the promise that he could sit down during his commute to work.

Lee, who works in downtown San Francisco, has about a three-mile ride from his home in the Haight-Ashbury neighborhood, which is roughly in the center of the city, to his office. Typically that trip takes about 30 minutes, and sometimes the buses are so full he has to wait for one or two to pass before he can squeeze on for standing room.

So Lee began using a new private shuttle service called Chariot, which launched in April 2014. Chariot hopes to provide an alternative to San Francisco’s municipal busing system, aka Muni, for a fee of about $2 more per ride. For Lee, the cost is worth it for the luxury of sitting.

“Basically it comes down to being able to sit,” Lee said. “Sometimes I like to work and I can use my laptop and not be all squished.”

That promise of a comfortable commute is powering some of the newest startups in the tech industry. In San Francisco, Chariot and another service called Leap have begun sending buses across the city, taking on customers who pay with via smartphones. In true Silicon Valley style, all buses come Wi-Fi enabled, and Leap’s buses even have a coffee bar and counters where riders can tap away on their laptops.

Unlike the buses for Google, Apple, Facebook and other high-tech firms, which shuttle employees from San Francisco to company offices about an hour’s drive away, Chariot and Leap focus on commuters traveling from various neighborhoods in the city to downtown. But like the corporate buses, which have become a symbol of gentrification and income inequality in San Francisco, Leap and Chariot have also been criticized. Some say the shuttles cater to affluent clientele and could unfairly compete with the city’s public transit system.

Many urban planners and the San Francisco Municipal Transportation Agency say, however, that these startups could actually complement the city’s crowded system and give people more alternatives to driving a car.

“How do we broaden the pie?” said Timothy Papandreou, director of strategic planning and policy for the SFMTA’s Sustainable Streets division. “As long as everything we’re doing — whether it’s car-sharing, bike-sharing, these services, public transit, walking, bicycling — is helping us provide better choices to people who get in a car and drive, then we’re on the right path.”

Taking a ride with Chariot and Leap

Chariot isn’t much more than a van service. It ferries customers to and from four neighborhoods and runs about every 10 minutes. The shuttles look like small tour vans, with a sliding door and about four rows of seats.

To use the service, passengers need to download the company’s app and buy tickets, which come in the form of an unlimited monthly pass for $93 or bundles of tickets. The cheapest bundle is two rides for $10. For comparison, a one-way Muni ride is $2.25 and a monthly pass is $68 — though Muni buses are heavily subsidized by city, state and federal funding.

When passengers board Chariot vans they scan their smartphones at a screen set up behind the driver and are offered a free bottle of water. Chariot co-founder and CEO Ali Vahabzadeh said the startup is now giving more than 4,000 rides per week.

Vahabzadeh founded Chariot after he moved to San Francisco from New York City and saw how certain neighborhoods were difficult to access on public transportation. City buses were slow and crowded, he said. So he set out to create a “superior commuter service that is very affordable, fast and reliable.”

Leap, which launched last month and is backed by the influential venture capital firm Andreessen Horowitz and Salesforce CEO Marc Benioff, also has the goal of being fast and reliable. But it’s not focusing on affordability — rides cost $6 apiece.

For that fee, passengers sit in a plush vehicle that feels more like a coffee shop on wheels than a bus. Each Leap shuttle has a concierge-like employee with the title of “experience manager,” who greets passengers and helps scan their smartphone tickets. People can use Leap’s app to order iced Blue Bottle coffee for $4.50, blueberry yogurt for $2.50 or $7 cold-pressed juices from a company called Happy Moose that come in flavors like kale or strawberry.

Leap’s shuttles have only 27 seats, while most buses have about 50. Along with the countertop bar for people working on their computers, the buses have U-shaped seating in the back that was designed to encourage socializing. For now, Leap runs only between San Francisco’s pricey Marina waterfront neighborhood and downtown.

Leap co-founder and CEO Kyle Kirchhoff said all of this was built to stop people from driving. “We want people who don’t use mass transit to use it,” he said. “We really look at this as complementary to the rest of the transit grid.”

Good for the rich, or good for everyone?

Private transportation for groups of people is nothing new. Super Shuttle, for example, has been offering rides to and from the airport for more than three decades; “dollar vans” have run up and down Flatbush Avenue in Brooklyn, New York, since the 1980s; and unlicensed vans called jitneys roamed San Francisco up through the 1970s.

“There’s a bit of a renaissance occurring with these jitney types of services being revived,” said Susan Shaheen, co-director of the Transportation Sustainability Research Center at the University of California at Berkeley.

Both Leap and Chariot have set up stops near the city’s bus lines and run similar routes. But unlike public transport, the shuttles run only during the morning and evening commute hours and don’t stop in neighborhoods besides their pickup and arrival destinations. Before launching, the two startups said they met with the city of San Francisco to work out licenses, routes and loading locations. So now they’re completely legal and aren’t using Muni bus stops like the corporate buses controversially did.

City planners say it’s too early to determine Leap and Chariot’s effect on public transport, but they say the shuttles could be helpful if they ease traffic on certain routes. Many key corridors in San Francisco are heavily congested, said SFMTA’s Papandreou, and if Leap and Chariot add seats to these overcrowded transit zones they could supplement Muni’s service.

“I think competition is good as long it’s fair,” Papandreou said.

Muni gets about 700,000 passenger boardings per day, which makes Leap and Chariot’s ridership look like a drop in the bucket. Both shuttle services focus on neighborhoods that have only bus transit and no rail lines, in part because rail service areas tend to be less congested. They’re also operating in some of the city’s wealthiest neighborhoods, because that’s where they see their core clientele.

Both Leap and Chariot say many of their passengers used to commute to work in cars, taxis or with ride-hailing services like Uber and Lyft. This gets to another reason why the SFMTA and some urban planners believe these shuttles could benefit the general public — because they can help take more automobiles off the road.

“In the Bay Area, the vast majority of trips are still made in single-occupant private vehicles,” said Gabriel Metcalf, president and CEO of nonprofit urban policy research organization Spur. “We have a long way to go to outcompete the private automobile and that needs to remain our focus.”

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