ABSTRACT
To elucidate the impact of online car-hailing (OCH) on traditional taxi services and in producing structural changes to urban taxi markets in China, we propose a model based on the market access rules and business models of the two modes that analyzes their interactions in the following arenas: fleet size, passenger waiting time, service level, and driver income. Then, we build a nested logit model to predict the modal splits and market shares for four travel modes (online car-hailing, traditional taxi, metro, and bus). Taking Ningbo as an example, we estimate the changes in the number of OCH vehicles, the modal splits of the four travel modes, and the new equilibrium in urban taxi service markets. We show that OCH puts significant pressure on the traditional taxi market due to the positive feedback between OCH fleet size and its service quality.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Authors’ contributions
Xu YI: Formulating the model, data collection and processing, solution calculation, and manuscript writing. Kang CHEN: Troubleshooting, modeling, implication analysis, English writing and editing. Zhongzhen YANG: Posing the research question, structuring the model, and manuscript writing.
Notes
1 For the relevant parameters in Step 1, please refer to in Section 4.1.