Transportation Innovation Newsletter #2
For the past two years, I have published an internal Arup newsletter on the latest news and research in transportation innovation. So while this newsletter is technically #51, this is the second public-facing issue.
This week’s super summary:
- Didi shutters free carpooling
- Walmart.com encounters logistics challenges
- Tesla AV ridesharing receives relatively low valuation
1 — China’s Didi suspends carpooling service after another female passenger is murdered, Aug 26 (TechCrunch)
As the title suggests, a disturbing story has shaken Zhejiang, China, and indeed all users of the Didi Chuxing service (China’s Uber equivalent). Last week, a driver raped and murdered a female passenger who was riding in his car via Hitch, Didi’s free carpooling service. The incident is the second murder in which a Hitch driver attacked a female passenger. After the first murder, Didi suspended Hitch for a week during the investigation. Now only four months later, the ridehailing company has permanently suspended the carpooling service.
Before the first murder, Hitch seemed to be a wild success. Didi claimed the service hosted more than a billion rides over three years. As a free carpooling service, Hitch likely reduced congestion and greenhouse gas emissions while introducing users to the Didi platform — a win-win for cities and for Didi. However, these two murders reveal fundamental security failures in Didi’s service. First, the female passenger murdered last week had messaged her friend for help. Was there no other more effective way for the woman to escape or call for help? Second, the day before the murder a different passenger had flagged the driver, accusing him of following her for blocks after dropping her off. Didi had not started an investigation immediately as the company claims to be protocol.
In response, Didi has permanently suspended the service throughout China, although the company continues to operate its monetized carpooling and ridesharing services.
This incident is harrowing for everyone involved in providing and promoting shared mobility. In the US, the average vehicle occupancy has hovered just above 1.7 people per vehicle across all vehicle types for the last twenty or so years, despite a typical automobile having a minimum five seats. So even while our streets and freeways are clogged with congestion, massive inefficiencies in vehicle occupancy remains a challenge. Motivating travelers to share rides is exceedingly difficult.
Shared mobility services such as Hitch seem to be an ideal solution to vehicle occupancy inefficiency. However, shared mobility can only succeed if passengers are safe. It is imperative that regulators require new mobility service providers to prioritize safety and security, particularly as autonomous services become widely available. Service providers have multiple considerations in addition to trust such as user experience, profitability, scalability; regulators should be concerned first and foremost with trust earned through security. But how do regulators uphold such standards? Specifically what could have prevented this incident?
Most importantly, safety data must be measured and publicly reported, creating transparency and motivating companies to improve. Second, service providers should require in-vehicle alarms and mechanisms for escape. Third, incident investigations should be required, with results made public (while protecting the accused who have been found innocent).
Without such reforms, shared mobility — true shared mobility in which multiple people are sharing a ride — will fail.
2 — Walmart’s new fulfillment strategy causing out-of-stocks, Sept 4 (Business Insider)
Amazingly, despite having huge stores across the United States, Walmart is encountering a major logistics and delivery challenge with its e-commerce services. The company’s latest attempt at cutting logistics cost is threatening both suppliers and customers. Since at least August, Walmart has been showing items as out-of-stock that are too far away to ship cheaply within a 2-day window. Instead, the website recommends replacement items that are stocked in closer warehouses. Of course, this strategy risks irritating customers while hurting suppliers. Other strategies have also failed, including confusing online shoppers by showing an online price and a lower in-store price and and trying to negotiate with supplies to provide more or more expensive items.
Even though Walmart.com remains one of the largest online retailers, Internet natives such as Amazon and Alibaba continue to dominate, particularly in prioritizing user experience above all else, including logistics costs.

3 — Tesla’s RoboTaxi Worth a Fraction of Waymo, Morgan Stanley Says, Sept 4 (Bloomberg)
Market valuations for non-existent services should be taken with a fairly hefty grain of salt. Yet such pronouncements do offer a key perspective on industry and front runner status. In its latest autonomous vehicle industry valuation, Morgan Stanley has valued Tesla’s autonomous ridesharing service at one tenth of Waymo’s value. While it’s not surprising that Morgan Stanley puts Waymo ahead of Tesla, since Waymo continues to be the indisputable industry leader (despite recent bad press), it is significant how very low Tesla’s autonomous ridesharing prospects have dropped to investment experts. So while Tesla initially seemed to jump in front by propelling Autopilot into all new Teslas, the company has failed to maintain an advantage in AV development.
Thank you for providing articles Chris Lentini, David Levinson, Jon Russell, Thomas Bamonte
