Balancing Fares and Demand: Exploring Pricing Strategies for Microtransit and Fixed-Route Transit

Research Lead: Michael Hyland

Research Team: Michael Hyland (lead)

UC Campus(es): UC Irvine

Problem Statement: Fares for both conventional fixed-route transit (FRT) and microtransit significantly impact demand, traveler costs, and transit agency revenues. While crowding is typically not an issue for most FRT systems in California, microtransit’s smaller vehicles make it more prone to “crowding,” where demand temporarily exceeds service capacity. This can result in long wait times or service rejections, especially during peak periods. Fares can help manage peak demand, but fare increases can be controversial, as many users rely on transit for essential travel.

Project Description: This study will explore the effects and trade-offs of various fare levels (e.g., $2, $5, $10) and fare structures (e.g., flat, distance-based, time-of-day-based, or means-tested discounts) on microtransit and integrated systems combining microtransit with FRT. The research team will evaluate factors such as transit revenues, ridership by mode, subsidies per trip, traveler costs, wait times, rejection rates, travel times, mode share, vehicle miles traveled, and other key metrics.

Status: In Progress

Budget: $99,000