Autonomous public transport: more frequent services, smaller vehicles, reduced fare and reduced subsidy

Abstract

Driverless vehicles will eliminate one of the main elements that cause economics of scale in public transport: drivers’ wages. Therefore, the cost advantage of placing many travellers in large buses will be reduced; thus mobility services with smaller vehicles are expected to play a larger role in the future. In this paper, the effect of automation on shared or public mobility services is addressed with a supply optimisation model that takes into account both users and operator costs. We extend current cost models for autonomous vehicles that focus on operator costs only. Vehicle frequency and size are optimised to minimise total (user plus operator) costs; optimal fare and subsidy is also derived. The model can be solved for increasing levels of demand. We show that the benefits of the reduction in vehicle operating cost due to automation benefit three parties: (i) operators, through a reduction of operator costs; (ii) public transport users, through a reduction on waiting times and on the fare to be paid for the service, and (iii) the public sector, through a reduction on the optimal subsidy to be allocated to the public transport system. The size of these savings in some cases are straightforwardly estimated and in others depends on the parameters of the problem.