Posted on February 15, 2019
So, what did Southwest do about it? They offered super low fares. What this did was fill the empty seats, while at the same time raise the profitability of the overall flight. It increased the “load factor”.
Now, we know that Southwest did more than this. They subsequently aligned their operation so as to sustain low fare leadership. We believe there are those in the airport shuttle business at LAX that are up to the same challenge.
And the reward is so very large when they do! The LAX shuttle van industry has long known that, when they fulfill their promise of on-time service, shiny shuttle vans, professional drivers and sensible routes to and from LAX (in other words, taxi service doesn’t cut it!), they suck people right out of their private cars.
So, as we explored the possibilities further, we sought to calculate just how many private cars there are out there going to and from LAX each year. It turns out that it is a few million. That’s right, a few million! (We were shocked, too!) And not one or two million. Not even ten or twenty million. In the LAX market, the private car is responsible for the airport ground transportation of approximately 35 million passengers each year.
Just a couple of million would make all our dreams with this program come true. And it doesn’t stop at LAX. There’s all those other airports in Southern California. But, in our imagination this plan goes well beyond airports. Airport rideshare is just plan A.
You will find this jitney type of transportation in many third world countries, and here’s the thing about it … it represents the most efficient means of ground transportation, bar none. Now, we know this is a bold statement, but here’s a little rideshare theory for you. If you have a 40 passenger bus and a nine-passenger shuttle van running side by side from point A to point B, which is more efficient? The bus is, of course. However, the thing about a shuttle van is that it can take a left … and a right … and another left or right. It is in the shuttle van’s flexibility, if you follow us, that it gets its efficiency.
In a metropolis, and particularly in a megalopolis such as Southern California, shuttle van rideshare is the most efficient form of ground transportation, precisely because of its flexibility. Passengers are no longer going from point A to point B, but they are coming from everywhere and going to everywhere.
It doesn’t work in Los Angeles for the owner-operator to decorate their shuttle van as they wish, of course. In America, we are particularly fond of uniformity and, even better, franchise-like uniformity. It also doesn’t work to hail the shuttle with a wave or a whistle. However, for the first time in history, we have what does work, and this is the smartphone. Imagine, if you will, reaching down to your iPhone at your hip and “hailing” your shuttle van. Your request goes directly into the automation, comes right back to you with the closest time to your requested shuttle van pickup, and you’re on your way! The automation can accomplish this because of all the technology readily available and affordable at this point in time. The automation knows where the shuttle van is, by its onboard GPS. The automation knows where the phone is, and already has the other items pertaining to payment from the passenger having previously established a login.
Now imagine ubiquitous shiny shuttle vans throughout the city, with happy owner-operators just following the pickups all day—like one big video game—the automation not only indicating another real-time pickup for them but guiding their shuttle van to it. If we establish a flat fare to anywhere—twenty bucks to anywhere, for example—who wouldn’t use us from time to time? That is, everyone would if indeed you got an immaculate shuttle van, bright driver, safe and sensible route (which improves over time as the automation “learns”), every time.
Imagine this, if you will. However, it isn’t hard to see that this is indeed the right time in history for this and, if accomplished, would indeed be revolutionary. This is mass transportation that is personalized and hip; for the first time, true “hop-on, hop off” transportation, made possible by state-of-the-art technology, and with reclining seats and Wi-Fi onboard. At the same time, it’s good for society! Each shuttle van represents three cars off the road. When you use it, you’re reducing pollution, mitigating traffic, decreasing our reliance on foreign oil, and supporting a transportation system that doesn’t require huge governmental infrastructure outlays. Quite an advertising hook in this Going Greenage.
Okay, so let’s say that we’re just wild-eyed entrepreneurs, and that Plan C can never be accomplished. Here’s the thing, though … just in shooting for it, you accomplish Plans A and B, and that would be well worth the effort. In Plan A alone, the potential ridership is so high, it’s like the skyscraper above of which, for the life of you, you can’t see the top. Thirty-five million cars are so many it washes out the concerns of seasonality and threat of terrorist attack. The only concern is whether we can get people out of their cars, and the LAX shuttle van industry answered that question long ago. If you fill the quality gap, they will come, and they will come in droves.