Uber Express Pool

Uber Express Pool offers the cheapest fares yet in exchange for a little walking

Uber’s first new product in three years

By Andrew J. Hawkins@andyjayhawk  

Photo by Amelia Holowaty Krales / The Verge

UberPool has long occupied a weird place in the ride-hailing company’s lineup of services. Riders love it because its so cheap, but drivers hate it because of the stress of ferrying multiple passengers to a variety of destinations. And the company’s executives are torn between the belief that UberPool best personifies their long-term mission of reducing the number of vehicles on the road and the millions of dollars in subsidies they need to spend in order to keep it running.


This week, Uber is formally launching a new type of carpooling service that aims to address many of these issues. It’s called Express Pool and it’s Uber’s first new product in three years. And for a company that’s built its entire business model on unsustainable and unprofitable levels of convenience, its unique in that, well, it’s kind of a schlep.

IT’S KIND OF A SCHLEP

Here’s how it works: riders who select Express Pool will be asked to wait a minute or two longer than usual to be matched with a driver. The idea is that during this additional time, Uber’s algorithm is blasting through hundreds of different drivers, routes, pickup and dropoff locations, and additional riders looking for the optimal match. After the match, riders will be directed to walk a few extra blocks to their pickup location, where (if Uber’s algorithm worked the way its supposed to) they’ll hopefully meet one or two additional riders who’ve also been matched with the same driver.

Ideally, these people are headed to the same general area as the original rider. At the end of the ride, passengers will be dropped off within walking distance to their final destination. And their reward for all this extra waiting and walking? Dirt-cheap fares, up to 50 percent cheaper than UberPool and 75 percent less expensive than UberX.

Uber isn’t the first service to offer ridiculously low prices for less convenient, shared rides. Ride-sharing service Via, in which short trips can cost as low as $5, operates in New York City, Chicago, and Washington, DC. Lyft’s carpooling service, Lyft Line, often is cheaper than UberPool, thanks to subsidies and discounts. So it makes sense that Uber would be getting more aggressive in this space.

Uber has been piloting Express Pool in San Francisco and Boston since last November. (TechCrunch was the first to catch wind.) And before that, Uber’s team in New York City was experimenting with asking UberPool riders to walk to pickups and destinations in Manhattan. So pleased are they with the results, that they’re now rolling it out to a bunch more cities: Washington, DC, Los Angeles, Miami, Philadelphia, San Diego, and Denver, with more cities on the way.

“We think carpooling is very much the way of the future,” Ethan Stock, director of product for shared rides at Uber, tells The Verge. “Not only for our service, but we think the transformation of car ownership towards carpooling is going to be tremendously beneficial for cities, for the environment, for all the reasons that we’re very familiar with — congestion, pollution, etc.”

“WE THINK CARPOOLING IS VERY MUCH THE WAY OF THE FUTURE.”

Carpooling may be the way of the future, but it’s had a rocky start at Uber. Since its launch in San Francisco in 2014, UberPool has grown to 36 cities worldwide: 16 in the US, and 20 internationally. In the cities in which it operates, UberPool accounts for around 20 percent of all rides, Stock says. And the service is rapidly approaching its 1 billionth trip.

But UberPool has also been an expensive bet for the company. In a heavily subsidized effort to attract users, the ride-hailing giant dropped $6 million between 2014 and 2015 to get UberPool running right, reports BuzzFeed. During that period, Uber sometimes burned over $1 million a week to subsidize Pool in San Francisco alone.

When it started UberPool, it had a low match rate — only 3,600 of the 35,000 trips taken in its first week carried matched riders, according to BuzzFeed. Nine months later, it had an improved match rate of 60 percent. However, Uber found that when it tried to make the service profitable and got rid of the subsidies, ridership plunged. People switched to other, cheaper services like Lyft Line or Via. This has always been Uber’s main challenge: with so much competition, riders will always gravitate to the cheapest option.

Carpooling is tricky for everyone. The service continues to be a source of frustration for many riders. Last weekend, Wall Street Journal tech reporter Greg Bensinger’s tweets complaining about Lyft Line prompted Uber CEO Dara Khosrowshahi to respond by teasing the improved experience of Express Pool.

It was with these issues in mind that Stock and his team took on the task of completely rebuilding the backend of UberPool. It took them almost a year to get it exactly right, but even then he’s left wondering whether they can truly achieve the ideal carpooling service.

“What we call a ‘perfect pool’ is when three individuals get into the car at the same place, and get out of the car at the same place,” says Stock. “In that ideal scenario, they’d each pay four bucks, and the driver and Uber’s earnings would be unaffected by that. That is a very, very difficult thing to achieve because there’s an enormous amount of logistical complexity, and what we’re always striving toward is to get as close to that optimal point.”

One unique thing that Uber did in preparation for the launch of Express Pool was to send teams of employees to walk the streets on scouting missions for ideal pickup and dropoff locations. Uber didn’t send its people out to scour every single street corner, but it did direct them to “spot check” certain locations to ensure they didn’t conflict with regulations or transit hubs. “I think it’s a tremendous superpower we have as a company,” Stock says, “if we can actually say, ‘hey, here’s 150 question-mark spots that we need to go check out in the city to make sure that they’re ok for riders and drivers, let’s go check them out and have the answer by the end of day.”

At such a low price point, it begs the question whether Uber was increasing its level of subsidies for Express Pool. But Stock says that was not the case, citing better matching algorithms, a straighter route, and a more efficient trip as “the reason why we can offer it at these lower prices.” With UberPool, efficiently matching the first passenger (formerly known internally as “master” but now referred to as “primary”) with a second and third passenger (formerly “minions,” now “secondary”) was the key to a low burn rate.

“When we’re trying to get the best possible matches, we’ve gone to an extreme non-committal state in the app that we’re not even telling you where your walking spot is going to be until after you’ve waited the one to two minutes upfront,” Stock says. “That level of dynamism is what allows us to get these most optimal matches.”

(An Uber spokesperson later clarified, “Introduction of Express Pool is allowing us to reduce our overall subsidies to shared rides because it’s more efficient.”)

“WE’VE GONE TO AN EXTREME NON-COMMITTAL STATE IN THE APP”

Express Pool isn’t as bus-like as some previous Uber experiments, like Smart Routes (in which San Francisco residents were offered discounts on rides if they were willing to be picked up and dropped off along popular roads) and UberHop (a short-lived experiment in Seattle which was designed around fixed pickup and drop-off points). “There are clearly corridors and routes where it makes sense to put a 60-passenger on that and drive it back and forth in a straight line,” Stock says. “And that is very much what we’re not trying to do here.”

That said, at such a low price point, Express Pool will certainly stand accused of trying to compete with public transportation. Recent studies have shown that as people use these ride-hailing apps more, they are using public transportation less. Many trips that could be made by foot, bicycle, or via public transit are now made by ride-hailing services. If Express Pool scales up, those numbers are likely to rise.

Uber is on a quest for the perfect ride. Back in 2015, then-CEO Travis Kalanick described it to employees as “a perpetual trip — the driver picks up one customer, then picks up another, then drops one of them off, then picks up another.” Uber’s big bet on carpooling is seen by many as a prelude to its even bigger bet on self-driving cars. But before that can happen, UberPool needs to get exponentially more efficient. And that’s where Express Pool comes in.