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Open Access Publications from the University of California

Peak Pricing and Transfer Discounts Can Make Microtransit More Efficient

Abstract

Microtransit offers flexible, on-demand rides that can fill gaps in public transit networks, especially for people who do not have access to a car and live in an area where fixed-route service is limited. However, operating these services is expensive. For example, LA Metro once reported a taxpayer subsidy of $43 per microtransit ride, and another California transit agency reported even higher costs. Additionally, because transit agencies offer low-cost, flat fares, demand for microtransit often exceeds service capacity during peak hours, leading to long wait times and unfulfilled trip requests.