Business & Tech

SCOTT KIRSNER | INNOVATION ECONOMY

Can these companies make taking a bus cool?

Mark Fields, chief executive of Ford, spoke about the Chariot transit service — which was recently purchased by Ford — earlier this year at the North American International Auto Show in Detroit.
Scott Olson/Getty Images/File
Mark Fields, chief executive of Ford, spoke about the Chariot transit service — which was recently purchased by Ford — earlier this year at the North American International Auto Show in Detroit.

The entrepreneurs launching private bus service in cities like Boston, San Francisco, and Austin like to talk about “pop-up urban infrastructure,” “on demand” transportation, and, in the words of Ali Vahabzadeh, chief executive of Chariot, “reinventing mass transit.” They also don’t mind being dubbed “Uber for buses” by the media.

But for companies like Chariot, acquired last September by Ford Motor Co., and Bridj, a startup headquartered in Back Bay, the comparison to Uber only goes so far. Yes, you use an app to access the service, and each ride gets billed to a credit card. Like Uber and rival Lyft, the two bus companies might soon be dueling for riders on the streets of Boston and other US cities.

There are, however, many ways in which even app-enabled bus ridership still feels like riding the bus: You need to tromp to a stop and wait for the vehicle to arrive. Once onboard, you’re still very much a victim of Boston traffic; a scheduled 12-minute Bridj trip from Coolidge Corner to MIT on Thursday stretched to 26 minutes. Even though the seats are leather, you still might be shoulder-to-shoulder with your seatmate.

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And unlike public buses, startups like Bridj and Chariot operate only during rush hours and not on weekends. There also are plenty of routes they don’t serve. It can be a frustrating experience to punch in destinations to an app or website to get the reply, “Sorry — we don’t go there yet.” Pricing ranges from $3.50 to $5 per ride, though Chariot does sell unlimited monthly passes.

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Bridj and Chariot both launched in 2014, in Boston and San Francisco, respectively. Neither has raised anywhere near the billions of dollars that have poured into popular car services. Bridj has raised just north of $6 million, according to chief executive Matthew George, and Chariot collected $3 million before it was bought by Ford for an undisclosed amount.

As a result of the limited capital, expansion has been slow. Chariot is active only in San Francisco and Austin, Texas, though Vahabzadeh says the company will launch in six other cities this year. (Chariot recently posted a job opening for a general manager in Boston, but Vahabzadeh wouldn’t confirm plans for any specific cities.)

Bridj expanded to Washington, D.C., in 2015 but discontinued service there a year later. (Bridj’s George now calls that a test of the economics of serving neighborhoods with “a lower average income by far than the rest of the city.”) A plan to begin service last summer in Austin never got out of the garage. “We chose to focus on a different project,” George says.

Bridj now runs service in Kansas City, in partnership with a public transit agency. George dubs it “a massive success,” with riders rating the service 4.82 out of 5 stars. But only about 600 people rode the Bridj buses over their first six months of operation, according to the Kansas City Area Transportation Authority.

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Aside from that data point, it’s hard to get concrete numbers about how many people are using these new bus services. Vahabzadeh says “tens of thousands of users” take Chariot on a regular basis. Without supplying numbers for 2015, George says Bridj “grew by 550 percent, in terms of rides and revenue, in 2016,” and that the company plans to add more service to Cambridge and, “hopefully,” Somerville this year.

There’s also limited information about whether the services are pulling riders from public transit or from private vehicles. A 2016 Ford-funded study conducted by KPMG suggested that each bus that Chariot deploys could result in up to 25 fewer cars on the road. Vahabzadeh says about 20 percent of Chariot users are taking the bus to a commuter rail, subway, bus, or ferry terminal, which suggests they’re still using public transit for part of their journey. A survey of 18 Bridj customers in Kansas City, conducted by researchers from the University of California, Berkeley, found approximately equal amounts of riders who said driving alone or using a city bus was their primary mode of commuting. (Just one respondent in that survey said Bridj had become his or her primary mode of commuting.)

“The data may be coming in slowly,” says Jim Aloisi, who served as transportation secretary under former governor Deval Patrick, “but it worries me that companies like Uber, Bridj, Lyft, and Chariot will begin to erode the use of the public transportation system. Rather than bemoan it, we have to recognize the reality of the situation and then respond to it.”

Vahabzadeh makes the case that services like Chariot can “expand the mass transit pie, bringing people back who may have given up on the bus because they could never find a seat, or people who didn’t have public mass transit in their neighborhood to begin with.”

A big question is whether these services can actually make money one day. (Two bus startups in California, Leap Transit and Nightschool, have already vanished.) Part of the equation might be whether cities provide funding to help bring new transit options to underserved areas; Kansas City ponied up $1.3 million for a one-year test of Bridj service that concludes this month. Vahabzadeh of Chariot says, “Our goal is to produce a profitable mass transit service without the help of taxpayer subsidies, and we think we can do it.” He adds, though, that he isn’t opposed to cities subsidizing the initial launch of Chariot service “so we can get it up and running.”

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The other part of the profitability picture might be whether these companies can operate without drivers in a few years’ time. George says Bridj is “actively working with a number of auto manufacturers” to explore self-driving electric vehicles. Testing could begin later this year or early next.

For Bridj, Chariot, and other bus startups, survival and expansion might hinge on attracting more riders — and having fewer drivers on the payroll.

Scott Kirsner can be reached at kirsner@pobox.com. Follow him on Twitter @ScottKirsner.