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Armed with a fleet of Teslas, Shift takes aim at Uber, public transit

Shift wants to change the way we get around cities. (Shift)

A new transportation start-up, Shift, is creating its own intelligent mass private transit system. Moving around a city would be far less complicated if every bike, car, and bus was connected to an intelligent system that could automatically decide which mode of transit was the quickest for pedestrians to get from point A to point B. But upgrading every piece of transit equipment is too ambitious for a city government.

So, with $13 million in funding and legal playground in the tiny metro of downtown Las Vegas, Shift is creating a 21st century transit system from the ground up. The company made headlines after it purchased 100 Teslas for the core of its fleet, but has since been silent about how exactly the company planned to tackle both Uber and public transit. For the first time, Shift has provided the Washington Post with a demo of how it will work.

The Basics and a demo

Shift’s guiding philosophy is that most city dwellers don’t care much about the vehicle that gets them from point A to point B, as long as they can get to their destination cheaply and quickly.

To that end, Shift has designed to take the thinking out of transit. A fleet of private bicycles, tiny smart cars, Teslas, shuttles and on-call valets are scattered throughout a city’s downtown “urban core.” The company guarantees that users can be on their way with the most efficient transportation means within five minutes of summoning the app.

In the demo video above at their downtown Vegas headquarters, Jamie Schieber, customer service director, shows us what happens when I tell Shift that I want to go the local watering hole, the Golden Nugget, a few miles away.

Shift’s algorithm searches through its inventory of transit options and eventually selects a Tesla; an electric car was chosen because the company has a few reserved parking spots near the bar and it’s far enough away that an car is quicker than a bike.

“It’s basically a math calculation. Where you are + where you want to go + how you want to go (drive/ride/bike) = the mode we match you to,” explains chief executive Zach Ware in an e-mail. “That decision is based on factors including the distance we predict your trip to be, your past patterns of movement or our predictions on what the system balance needs might be during your trip.”

After a decision is made, an electronic key reader automatically opens up the car, and the user is asked to answer a few basic questions about the condition of the car before they zip off.

At the moment, Shift is just piloting in the small downtown Vegas core and prices aren’t public. Ware tells me that he wants it to be affordable, with lowest tier as low around $25 for bike-only access; pricing gets more expensive at $250 for 20-30 trips, and $500 for frequent travelers.

Each package will contain a set of self-driving and valet options. If a user never wanted to drive a car again, they could splurge for an unlimited set of Shift “Valet+” drivers, but the company expects that most users will want to use a health mix of all transportation options.

Shift: We’re not Uber.

“Our biggest competitor is your car,” says Ware, who adamantly argues that he’s not trying to tackle the rising car-sharing behemoth, Uber. Instead, Shift has two missions: eliminate the need to own a car and make it easier for commuters to live outside of downtown metros.

Still, even if everyone took an Uber to work, cities would still be crowded with noise and air-polluting cars. “I was a huge Uber fan when it launched,” says Ware. However, “long term, when we look at platform plays like Lyft and Uber, they’re encouraging more cars to be on the road.” Uber has an incentive to pack as many cars on the road as possible to minimize wait times for each pickup request.

In fairness, Uber has added a carpooling feature to ease congestion, but Ware doubts carpooling can ever truly solve the problem of less cars on the road.

Users don’t want to be bothered with deciding whether it’s worth $15 to take an Uber or dealing with the erratic schedule of public buses. The subscription takes the hassle out of deciding, and users can just focus on what they want to do at a location, rather than dealing with how to get there.

Unlike Uber, Shift is a membership company; everyday the company has to impress its customers if it wants them moving up the tiered pricing structure. It’s partly why it splurged on Teslas.

“It’s the primary vehicle behind our Valet+ program. We wanted to provide a premium ride experience for our members but needed a vehicle with range similar to a gas powered car,” explains Ware.

And, perhaps most importantly, all Valet+ chauffeurs are full-time employees. In contrast, Uber employes an army of contract workers, who have to service and buy their own vehicle. Uber’s hands-off approach has seen strikes around the country, with picketing drivers angry over lack of benefits, a stable income, and abrupt pricing changes.

Shift employees, instead, perform every function within the company, from cleaning cars to chauffeuring users. If a car breaks down, an employee is immediately dispatched to pick up the wayward consumer and whisk them off to their location. It’s a white-glove approach to a car service that aims for deepening relationships with its user base. It also believes that happier employees will treat consumers better than a disinterested taxi driver.

Shift is even constructing a “drunk bus” for busy weekend nights to pick up the hoards of inebriated users stumbling around downtown Vegas. But it’s more of a party bus than a shuttle. Ware imagines that the bus will greet tipsy users with a cocktail as music blares in the background.

If more than one bus is needed, Shift could connect to users Facebook graph and construct an entire drunk bus of friends, so that they are officially the most fun transit option in the area.

Shift has set an ambitious goal of attempting to “relieve the pressure” on overcrowded cities, where residents would rather pay sky-high rents for a tin-can apartment than commuting every day from a cheaper outlying suburb. To accomplish this Shift plans on expanding parked vehicles into multi-family housing units and around the suburbs ringing city cores. Eventually it wants “dynamically routed” shuttles that pick up commuters in the most efficient way possible. Kind of like a UPS truck delivering human commuters.

If Shift is successful, company executives imagine solving the plague of sky-high city rents by allowing residents a quick and comfortable commute from the spacious suburban real-estate outside overcrowded cities.

For now, Shift has its eye on medium-size cities, which are experiencing the same pocket-busting rent spikes as New York or San Francisco, but with a population small enough that a successful start-up could significantly influence enough residents to move to orbiting suburbs.

Is Shift an Uber Killer?

Over the long-haul, it’s difficult to imagine a world where both Uber and Shift co-exist in peaceful capitalistic harmony. Shift’s subscription service seems like a delightfully convenient alternative for young urban dwellers who want to ditch their car. Indeed, I sold my car when I first moved to San Francisco, in large part because I knew I could rely on Uber when I really needed to get somewhere quick.

In practice, I often find myself taking public transportation more than expected, because I’m more fickle in the moment when I have a choice between a $2 bus and a $15 chauffeur experience. For San Franciscans who don’t like public transit, Shift may be the very excuse people need to finally get rid of their cars.

In the short-term, Uber may be compelled to copy Shift’s membership model, just as it adopted UberX from Lyft, the companies primary ride-sharing competitor, who originally popularized drivers who use their own cars as taxis.

Since Shift is aiming to fundamentally change transportation behavior, it’s hard to say what will happen. Already in their downtown pilot, Ware tells me that “the average trip length is a lot shorter than we anticipated. People are moving a lot and they are moving quickly.” Unlike Uber, Shift is giving pedestrians a completely new set of options to move around a city. If it continues to discover latent desires, the entire ridesharing industry could adapt to their findings.

“If mobility were completely frictionless and free of cost per use, your psychology of what you could do in a day could fundamentally change,” Ware said.