Vans Across America
SuperShuttle proves public transit isn't the only way to move the masses.
While city officials huddle with scores of ivory tower urban planners and professional environmentalists to come up with new things they can ban in the name of ending smog and traffic congestion, Mitchell Rouse is running an extremely successful private transportation business. "We get a million cars a year off the road," he estimates. If anything, that casual estimate is low, since customer polls indicate that most of the 400,000 passengers carried by his company each month formerly drove to the airport.
Rouse was running a taxi business seven years ago when a ski tour company asked if his taxis, at some discounted price, could transport its customers from Los Angeles–area beach communities to a chartered plane at the airport. "It became clear to us that this need wasn't isolated to this ski tour," says Rouse, "that this was going on 24 hours a day, seven days a week. We got a hold of some statistics from the airport that showed at any given hour of the day there were literally hundreds of people going from the South Bay neighborhoods to LAX, unbeknownst to each other. It wasn't hard to envision that if you could link these people together, you could provide a shared-ride service."
This simple idea became SuperShuttle International, Inc., a private company that has seen its annual revenue soar since 1984, according to Rouse, from $2 million to $50 million. Although there are now over 30 companies offering similar services, he figures his company carries about 5 percent of all airline passengers in L.A. In addition to serving five airports around Los Angeles, SuperShuttle now operates in San Francisco, Phoenix, Dallas/Fort Worth, and Miami. Soon the company hopes to serve Washington, D.C. and other cities. Rouse leans back on an L-shaped sofa in his four-car-garage-sized office near the airport and enjoys stating the obvious: "We're growing pretty fast."
SuperShuttle was not the first company to offer shared-ride airport service in Los Angeles, but it has succeeded famously because it is run well. Friendly, uniformed drivers in blue-and-yellow SuperShuttle vans pick up air travelers at their homes—making not more than three stops—and then whisk them to the airport. After dropping their passengers, the drivers, each assigned to a sector of the city, cruise around the airport until the command center tells them where to find passengers seeking rides into their sectors.
During peak hours, the SuperShuttle command center keeps almost 200 vans in play with the help of a sophisticated, tailor-made computer software program. Drivers no longer receive pick-up instructions from their radios. They simply read liquid-crystal display screens mounted on their dashboards. Although passengers must be ready an hour and a half before their flight leaves, SuperShuttle does get them to the airport on time. "The rap on L.A. is that nobody will use public transit," Rouse says. "That isn't true. They'll use it if it works."
While services such as SuperShuttle somewhat alleviate traffic problems, Angelenos by and large have not cured their addiction to the automobile. On an average day the streets of L.A. are best described as sclerotic. SuperShuttle drivers know this as well as anyone. On one wall of the driver training room is a map of the greater Los Angeles area that any commuter would give his or her car phone to see. Overlaid on the map is a red, spidery network of the fastest-moving streets between any two points, compiled from the collective experience of the drivers in dealing with L.A.'s notorious traffic. "We pretty much stay off the freeways," says Shift Manager Doug Thomson.
All kinds of ideas have been proposed as solutions to L.A.'s traffic problem: a special gas tax, double-deck freeways, converting to toll roads, limiting the number of cars per household, installing trains that will run down the center of existing freeways. Rouse shares the belief that something must be done to relieve congestion and air pollution. He resents, however, city planners' "general attitude of nonencouragement of privately provided shared-ride transportation while at the same time they are wringing their hands over how they can be doing more from the governmental side of it."
Rouse finds this attitude of nonencouragement reflected chiefly in taxes. As a "common carrier," SuperShuttle pays 1 percent of gross revenue to the state public utilities commission. Last year it paid $1 million to the city-owned airport (although this fee has come down slightly this year). And now city authorities may impose a business license tax that would cost SuperShuttle "several hundred thousand dollars a year," estimates Rouse.
"Everybody's got their hand out," he complains, "while at the same time, for publicly provided transportation, they're throwing money at it. They're highly subsidizing that." When taxes are raised, "we've got to pass this through," notes Rouse. But "they're going to make it so expensive there will be a disincentive to share rides."
He figures that wouldn't be very smart. "There aren't very many success stories for nonsubsidized shared-ride transportation. There have been a lot of attempts of people out there trying to create carpools and all these other things." But SuperShuttle and its competitors, "in spite of regulation, in spite of taxation, created a private enterprise that gets people of their own volition to leave their cars at home."
Craig M. Collins is assistant editor of REASON.