Last Mile Solutions - The pitch

Mass transit not convenient enough but hate driving in traffic? Try Last Mile Solutions.

Last Mile Solutions - The fun part

There is a fun combination of demand estimation and resource routing in this idea. What will the commuter demands be tomorrow and where are the best places to locate the cars throughout the day?

Last Mile Solutions - The growth potential

There are over 400,000 daily mass transit riders only counting BART. The roads likely bring another 200,000 people into San Francisco per day. If LMS were able to get 10% of the total commuters, that would be a profit of $60,000 per day or roughly $15 million per year. Expanding to other cities, this could grow by 10x to over $100 million a year.

Last Mile Solutions - The monetization

The pricing would be $12 per day (or $3 per day for self-driving cars) for cars where the longest trip is 1.5 miles, e.g., a 1.0 mile drive to the metro, ride the metro, and a 0.5 mile drive to work (and the reverse in the evening). For bikes, the cost would be $6 per day.

The car costs

Driving costs At a cost of $0.25 per mile for gas and wear and tear, and an average 4 miles per day per user, the total cost would be $1 per commuter per day.

Parking costs (city) In many cities it costs $15 per day for parking. It would only cost one fifth of that for the smart cars because of their size and that they can be perfectly packed with no need for isles. The result is $3 per day per car in a garage designed for Last Mile Solutions (LMS). LMS would also lease 2-4 spaces near most mass transit stops adding another $3 per day per car. (suburbs) Parking is the suburbs would be at least three times cheaper than in cities, so I expect the cost to be $1 per day per car. I think each car could serve 7 commuters per day. So the cost per commuter would be $1 per commuter per day.

Relocation costs (city) I expect city elves to use bikes to move cars around. I expect it to take 15 minutes to move a car from where it was left to where it is needed and get to another car. If each biker is paid $12 per hour, that’s $6 per commuter for the city-side of their commute. (suburbs) In the suburbs, it’s more realistic to use large trucks to move the cars around. That reduces the labor costs significantly. Being able to pick up and drop off four cars at a time helps to amortize the costs to $1.25 per car or $3 per commuter for the suburb-side of the commute.

Those costs add up to $11 per commuter per day, $9 of which is labor. Wow, that’s a lot. So, really for this idea to be viable, we need self-driving cars. With self-driving cars, the labor cost goes to zero, and the parking costs are reduced (just drive around to park further away where it’s cheaper, or even better, work as a taxi during the day). With self-driving car technology, the cost per commuter per day could be as low as $2.

Things look slightly less bleak for bikes, as there would be very little parking fees and bikes could be picked up and moved much more easily than cars, cutting the labor costs in half. So the total cost per commuter per day using bikes would be $5.  

Last Mile Solutions - The idea

The goal of Last Mile Solutions is to be the connection between the start and end of a journey and the mass transit system(s) that do the bulk of the transportation. There are two flavors of this idea: self-powered and motor-powered.

Self-powered

Each night before going to bed Alex schedules a bicycle to be waiting at his door when he leaves for work. The bike is dropped off the night before by an “elf.” The bike is unlocked from its mobile bike locker by Alex’s smartphone. He then bikes to a subway station, where he can lock up the bike. At the end of the subway ride, he unlocks another bike with his phone and bikes the last bit to work and locks it up outside.

Motor-powered

Like Alex, Alicia schedules transportation to be waiting for her in the morning (a smart car). Alicia drops the smart car off at the bus, which she takes the rest of the way to work.

The magic behind this idea is the Last Mile Solution Elves that move all the bikes and vehicles around town. For bikes, the Elves move bikes from people’s houses and their other destinations to the start points of other people’s trips. The bikes are dropped off with a heavy, but mobile, bike locker, which is unlocked via wifi when a user needs it. If a bike is dropped off near where someone will need it in the next few hours, then it’ll be left there. Also, elves will need to move bikes from one mass transit stop to another as needed by commuters. The bikes are moved by loading them into trunks and driving them to their destination. The elves will know where to distribute the bikes from a combination of the day’s user requests and previous user request patterns.

The same pattern would happen for the cars. The other difference is that the cars would need to be moved by elves who use bikes to get to the cars and then put the bike on the car or use a large truck that could hold 4 smart cars.

Last Mile Solutions - The motivation

Mass transportation systems have scales at which they operate efficiently, e.g., planes are best when traveling 400+ miles and subways and trains are best for 2-100 miles. There is a hole in this system at the shortest distances: transportation of 2 miles or less.