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Illustration: Sarah Grillo/Axios

Uber, Lyft and transportation agencies across the U.S. are encouraging customers to combine ride-hailing with public transit, ultimately to try to streamline travel options and payment.

Why it matters: These partnerships could fill in gaps in public transportation without worsening congestion. But they could also expose public transit riders to data privacy risks, and upend transit's business model.

What's happening: Aside from displaying transit schedules in their apps, Uber and Lyft also give discounts to customers who hail rides to and from public transit hubs.

The impact: The convenience is a huge selling point, but there could be unforeseen consequences.

  • Critics are concerned that private companies could control access to transit.
    • Ride-hailing companies could end up divvying up which services are available within their respective apps, creating parallel transportation systems.
  • Regulations around data sharing and customer data privacy have yet to be set.
    • It's unclear if Uber or Lyft could access public transit data and how it would be protected — and how much of their proprietary data would be shared with transportation agencies.
  • Pricing models could shift.
    • Ride-hailing prices in one case increased after a discount was offered.
    • It's eventually possible that transit riders could be siphoned off by ride hailing — or that companies could charge to offset discounted miles, or to feature transit within their apps.

Between the lines:

  • Neither Uber nor Lyft are profitable. Pivoting to become a multi-model platform could offer a sustainable business model.
  • Public transit agencies could develop their own next-generation apps to compete, but doing so is expensive and requires software expertise.

What we're watching: As partnerships between ride-hailing companies and public transit evolve, cities will need to create enforceable rules and regulations to make sure services remain accessible and affordable.

Raphael Gindrat is co-founder and CEO of Bestmile, which has developed a fleet-management platform.

Go deeper

Updated 2 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Annelise Capossela/Axios

  1. Health: Several states report zero COVID deaths for the first time in months — CDC says schools should still universally require masks and physical distancing.
  2. Politics: New York to lift mask mandate for vaccinated people — CDC director says politics didn't play a role in abrupt mask policy shift.
  3. Vaccines: Sanofi, GSK COVID vaccine shows strong immune response in phase 2 trials — Vaccine-hesitant Americans cite inaccurate side effects — 600,000 kids between 12 and 15 have received Pfizer dose since FDA authorization.
  4. Business: How retailers are responding to the latest CDC guidance — Delta to require all new employees be vaccinated — Target, CVS and other stores ease mask requirements after CDC guidance.
  5. World: World's largest vaccine maker expects to resume exports by end of 2021 — Biden administration to send 20 million U.S.-authorized vaccine doses abroad.
  6. Variant tracker: Where different strains are spreading.
3 hours ago - World

Scoop: Biden to waive sanctions on company in charge of Nord Stream 2

Angela Merkel (left) with Vladimir Putin. Photo: Adam Berry/Getty Images

The Biden administration will waive sanctions on the corporate entity and CEO overseeing the construction of Russia’s Nord Stream 2 pipeline into Germany, according to two sources briefed on the decision.

Why it matters: The decision indicates the Biden administration is not willing to compromise its relationship with Germany over this pipeline, and underscores the difficulties President Biden faces in matching actions to rhetoric on a tougher approach to Russia.

Prosecutor: Fatal police shooting of Andrew Brown Jr. was "justified"

Khalil Ferebee (C), the son of Andrew Brown Jr., and attorneys Bakari Sellers (L) and Harry Daniel (R) at a May 11 news conference in Elizabeth City, North Carolina. Photo: Sean Rayford/Getty Images

A North Carolina prosecutor said Tuesday that the death of Andrew Brown Jr., a Black man fatally shot by sheriff's deputies last month, was "tragic" but "justified," due to the immediate threat officers believed Brown posed.

Why it matters: The FBI has opened a civil rights investigation into Brown's death. Police in Elizabeth City shot him five times, including in the back of his head, according to an independent autopsy report released by family attorneys last month.