3Q with Onésimo Flores
In areas of the world that rely upon privately operated and lightly-regulated public transport services, the rise and proliferation of ride-hailing apps - such as Uber or Cabify - are making available a higher-level of service for consumers. Consumers who can afford ride-hailing have access to a whole new level of information about their mobility choices: they know what to expect, whom will be held accountable if something goes wrong, the fare they will be charged and the crowdsourced assessment of the quality of their driver. Onésimo Flores, a visiting lecturer at DUSP, was curious if it was possible to promote wider public access to improved services by applying features available in ride hailing apps to other public transportation alternatives. His hypothesis, that he could scale the ride hailing model but use larger vehicles and data-driven route planning methods to provide a more sustainable and accessible model for mobility, led him to found Jetty.
Jetty, which operates in Mexico City, provides a network of shared taxis, vans and buses that prioritize rider experience and safety but is able to provide that service in a sustainable and affordable manner. Jetty has received numerous awards, most recently it was named a regional finalist for the 2019 MIT Inclusive Innovation Challenge. Flores, who earned his PHD from DUSP and a Masters in Public Policy from the Harvard Kennedy School, recently joined us to discuss the mobility ecosystem in Mexico City and his vision for the future of mobility.
Q1: What enticed you to pursue an entrepreneurial effort after you completed your PHD? How does your training for an academic career inform your views of Jetty?
Flores: In Mexico City, privately operated jitneys (“peseros”, “micros”, “colectivos”, “chimecos”, etc.) move the vast majority of passengers, offering citywide coverage, charging affordable fares without requiring a government subsidy. Any given weekday, these operators serve 11.5 million passenger trips, almost three times as many as the local subway! Yet they do this by compromising on passenger safety and comfort, delaying fleet renewal and maintenance, and exploiting drivers. On board jitneys, women are often sexually harassed, and muggings are frequent. Drivers are often underage, unlicensed, and work 10-12 hour shifts. Insurance policies are seen as a luxury. So we face a wicked problem: Mexico City is increasingly congested because of the lack of high quality alternatives to the private automobile. Passenger experience in jitneys is so bad, and coverage of the BRT and subway networks so limited, that anyone who can afford a car abandons public transit forever.
This problem peaked my interest throughout my years at Harvard and MIT. I studied informal jitney networks in Latin America as part of my dissertation research, and developed an understanding of how this industry functions. After graduation, I researched the emergence of ride hailing and other innovations in the developed world as part of the “Transforming Transport” initiative at Harvard. The field of transportation is clearly experiencing a technology enabled revolution, but so far, it has been mostly limited to the relatively few who can afford expensive rides, or who live in cities that can commit substantial government funds to run and maintain a world class mass transit. Along with Cristina Palacios, my cofounder, we wondered if technology could trigger radical improvement of jitneys.
In the case of Mexico City, an Uber ride costs 10 to 20 times more than a jitney. While transformative, ride hailing is creating a deeper divide between the haves and the have-nots, and likely increasing congestion. Jetty aims to close this gap and reduce the number of private autos in the road by “technifying” the jitney industry. We take over all passenger support functions, use data to improve scheduling and route-planning, and set driver training and compensation standards. Passengers download our app, search for rides, reserve seats and rate trips in a way similar to ride hailing. But they board a van or bus, and this allows us to charge a much reduced fare. So far it is working. We are close to selling our one-millionth seat!
Q2: How does Jetty work and are there unique circumstances that make it successful in Mexico City? Would its success be difficult to scale to a generalist model?
Flores: Mexico City is certainly not unique. Governments across the world are forced to set high fares or to commit significant subsidies to sustain mobility. In most cities of the global south, fiscal constraints and competing priorities usually lead to limited mass transit coverage, to the emergence of informal transport services, to increasing individual motorization rates. Yes, a solution to vehicular congestion in cities like Mexico City, Johannesburg or Bangkok should probably include building a transit network of the scale and quality of Tokyo or Vienna. But this is simply not realistic in many of these locations. Mexico City managed to build only one subway line in the past 20 years! Unsurprisingly, the number of cars on the road in this city doubled in that same period. If we truly want to solve congestion, we need a faster, cheaper way to improve transit.
We propose to improve the system we already have, namely jitneys. We identified challenges for service provided by jitneys because they are not properly incentivized, are scantily supervised, and lack network-level data to make quick, informed choices. Jetty partners with colectivo operators, offering them the possibility to increase their revenues, expand their ridership (and protect their market from other emerging services). We take advantage of the flexibility embedded in the jitney industry, periodically suggesting new pick up and drop off points, modifying pricing and right-sizing the vehicle used in each route to reflect demand. And we bring the passenger to the table. Their feedback is our most valuable tool to identify problems.
Can this work in other places? We think it can.
Q3: In many US cities there is tension between mobility disrupters and established models of transportation, such as taxi drivers and ridesharing apps. Is there a similar tension between the existing jitney networks and Jetty?
Flores: Yes. Change is difficult, and risky. Earning the trust of our transport operators has been challenging. The day we launched, two of our vehicles, with our whole team onboard, were kidnapped for an entire day. More recently, one of our buses was vandalized. But these episodes are becoming increasingly rare. Over time, more and more jitney operators are understanding that our aim is to partner, not to replace them. We have similar pushback from regulatory agencies. The positive and negative externalities of our service are still not completely assessed or understood, and we don’t easily “fit” in any of the existing regulatory categories, leading some authorities to act guarded towards us. However, we make passengers, drivers and jitney operators happy. We are taking private vehicles off the road and reducing vehicle miles traveled (VMT). And we are helping improve a much needed, but badly run system, at zero cost to government.