22 ms·

Lyft’s Radical Experiment in Charging for Free Parking

148 points by victorvation 9y ago

noahmbarr 9y ago
This program isn't free for Lyft -- @ 1,000 employees and $375/space/month for each of the 53 spaces, the monthly program cost is $35K per month (with the subsidies net of revenue), or 420K a year in cash burn!!!! IMHO, they'd be better off shutting down the lot and using it as a picnic area / common area for everyone to enjoy.
- djrogers 9y ago
  I’m not sure I follow your numbers or your logic - Lyft charged their employees, where is the $35k/mo cost to Lyft coming from?
  - gwern 9y ago
    Presumably that's originally coming as part of the total cost of renting the building+mandatory parking lot. :)
Nav_Panel 9y ago
This is not a very radical idea. It is known that people are averse to losing things they already have (even in exchange for equal or greater benefit). I'm glad it worked out for Lyft without too many ruffled feathers, at least according to the comic. I'm glad this sort of idea continues to get media exposure. It needs it. An example, it is absurd to me (and most urbanist types) that Manhattan still has free street parking and that all the East River bridges are free. Congestion pricing in Lower Manhattan was on the table during the Bloomberg era, but never made it through. It should have.
- blacksqr 9y ago
  Congestion pricing proposals for publicly-owned infrastructure always run into the same problem: taxpayers paid for the building of the infrastructure, they already own it. Charging what the market will bear effectively turns the infrastructure over to the relatively wealthy to use. Making people watch as the rich get exclusive use of the infrastructure every taxpayer paid for never goes over well.
  - TulliusCicero 9y ago
    But what if charging what the market will bear means the rich are paying for the cost of the thing and then some? Anyway, my impression is that opposition to things like congestion fees come more from affluent commuting suburbanites than the poor (who probably already rely on transit anyway).
    - kaybe 9y ago
      Doesn't help if I don't get to use it..
      - TulliusCicero 9y ago
        But what if you don't need to because the money goes to fund alternative methods?
        blacksqr 9y ago
        Will those alternative methods also be congestion priced? Are you just setting up an infinite regression? If there's broad demand for increased capacity, why not just raise everybody's taxes to pay for it, and let everybody use it?
        Nav_Panel 9y ago
        No, because the point is that cars specifically are Pretty Bad for cities (noise, air quality, inefficient use of space, dangerous) and should be discouraged (and economic incentives work). Mass transit is generally far less bad and should be encouraged by economic means. NYC sort-of does this by not using zone fares, so long trips from far-away areas (read: poor parts of the city) cost as much as a brief trip through a rich area.
        TulliusCicero 9y ago
        Because of geometry: cars do not scale well in cities. Only so much land to go around, you want (need, really) people to use more space-efficient modes. Supporting cars is particularly expensive compared to other modes because of how much space cars take to move around and park.
mc32 9y ago
Doesn't the university down the peninsula charge everyone monthly/yearly parking fees to reduce driving and encourage people to take public transit/bike or live on campus? Most FinDi commuters have to pay for their spots. It's widely used and well known stick to get people to carpool or take alternative means to work.
- CaliforniaKarl 9y ago
  It's Stanford, and yes to most of that, but no to the "live on campus" part. 8-)
brwnll 9y ago
With so many companies offering employees public transportation passes for commuting, I'd love to see Lyft/Uber create the ability for employers to offer free/reduced fare office commutes (within a determined range). AFAIK the only option they have is to give blanket monthly credits.
- deleted 9y ago
  [deleted]
- misingnoglic 9y ago
  My girlfriend is starting a PhD at UCSF, and if they have to commute between 11pm and 6am the school will pay for the Uber/Lyft ride up to a certain amount. I'm not sure how it's facilitated but it's a good idea for sure.
tixocloud 9y ago
Tolls continue to represent an effective way of managing congestion in large cities but it's only if the community will be willing to accept it. Better transportation alternatives need to be provided in addition to the introduction of tolls to appease everyone.
noahmbarr 9y ago
You can't pay for that type of advertising.
rgbrenner 9y ago
The facebook character had the right answer. These companies have products that create more value than running a paid parking lot... why would you trade an employee on a product like that for a few dollars in parking fees.
- johnhess 9y ago
  The point of the article is that by making something scarce free, the company was in effect "rationing by the queue", an inefficient way to handle things. Those unwilling to get there early had a bad time. Instead they said, "Hey, we were giving the average employee $100/mo in parking. We're gonna keep doing that in the form of cash. But, to fund that extra 100 you're now getting in cash, anyone who wants to use the lot has to pay its market value." In short, instead of providing a "flakey parking availability" they provided cash. It's a lot (a lot... get it?) like selling the lot and giving the proceeds to employees. This isn't always the best idea (sometimes, similar schemes can be socially unjust), but from an efficiency standpoint, it's hard to beat. I hear what you're saying about pissing people off, but this should do the opposite. Sure, some folks might irrationally like jockeying for position or be early risers. But the company never intended to say "this benefit is for early risers". The intended it as a benefit to all employees and now it is.
  - rgbrenner 9y ago
    yes, I read the cartoon. There's nothing new in it -- these are all well known things (like 100 year old things). It's not clear that the companies they shopped the idea around to had a shortage of parking. Queuing costs are costs that the employees who are trying to park are imposing on themselves. A parking fee is a cost that is being imposed on the employees by the employer. It's reasonable for employees to react differently to those costs. If you're building a widely profitable business (like facebook), the better answer is to just build a larger parking lot. Just like lyft eventually did, and abandoned this bad idea.
    - throwaway91111 9y ago
      There's already too much damn parking. Stop driving to work. Live too far away? Convince your company to move to a place with sane housing costs. Facebook has the advantage of building in the burbs where there's already a glut of parking and people expect more.
obilgic 9y ago
What if experiment is conducted like this: 1. 53 top bidders pay and get their spot. 2. total money collected is shared between everyone who doesn't park
- ballenf 9y ago
  I was waiting for just that outcome and was also surprised that's not where it ended up. Would have addressed the income disparity complaint. Maybe it smells too capitalistic?
  - sowbug 9y ago
    I could see a concern that this would either look like a general partnership where the recipients of funds turned out to be liable if someone got hurt on the property, or else need to be a corporate entity of some kind with the recipients as dividend-eligible shareholders, with all the fun paperwork and tax-reporting requirements that come along with that. By the way I'm not sure about the capitalistic label. The recipients would do nothing to earn the money, did they?
    - Operyl 9y ago
      Well, could argue they had to do more to get to work? Unless of course they used Lyft to get a ride ..
  - Gaelan 9y ago
    That encourages driving up the price then dropping out to increase how much you get.
    - wyager 9y ago
      You can structure your auction in different ways to discourage this sort of bad behavior. For example: https://en.m.wikipedia.org/wiki/Vickrey–Clarke–Groves_auction https://en.m.wikipedia.org/wiki/Vickrey–Clarke–Groves_auctio... There's lots of auction theory describing good ways to sell things like parking spaces.
shahbaby 9y ago
It "worked" because people paid or found an alternative? Who's going to quit their job over parking? Seems like the standard formula for a business news article now is to repackage common sense ideas as something new and exciting. Charged for parking? Let's make a comic about how innovative that was.
- ajhurliman 9y ago
  Not really, if they're free and you just randomly give them out then it doesn't allow the power of the market to sort out who really wants a spot vs. who doesn't really care.
  - shahbaby 9y ago
    How is paying with money any more fair than paying with time? I'd personally prefer random distribution over selling to the highest bidder. Does every single thing really have to be for sale?
    - lmm 9y ago
      Money isn't consumed, the money paid can be passed out to other employees as raises. Whereas time spent waiting in line is a dead-weight loss. (Ok, it's not a 100% loss since you might be able to do something somewhat fun with that time, e.g. maybe you listen to a podcast while you're sitting in the parking lot. But it's not an ideal way to spend your time, and there's no way for anyone to get their time back)
- ghaff 9y ago
  >Who's going to quit their job over parking? Maybe not over just parking but because it's really inconvenient/expensive to go into the office--and you need to do so on a daily basis--absolutely. Which not being able to easily park at any time can be a component of.
AndyNemmity 9y ago
Demand is a fallacy because they compel you to come into the building. If they allowed everyone to choose to work from home, or from another location, then it would have something interesting to say about it. But the demand is artificial in that context, forcing people to exist at that office, and yet not allowing them the means to do so with their mode of travel of choice by not providing sufficient parking.
- revicon 9y ago
  I didn't see anything on the linked page that Lyft compelled employees to come into the office. Did I miss something that you read?
  - AndyNemmity 9y ago
    Most companies do by default, apologies if I'm incorrect, but does Lyft allow unlimited work from home?
- friedman23 9y ago
  Wow, you didn't even take econ 101 did you? Do you know what substitutes are? "Demand is a fallacy" Probably the dumbest thing I've ever read. Do you think there is no demand for food? Is demand for food a fallacy? Jesus.
- dbaupp 9y ago
  > yet not allowing them the means to do so with their mode of travel of choice by not providing sufficient parking They also don't provide a runway and hangar space, nor a marina, and probably not a SpaceX landing pad either! People can't commute with their mode of travel of choice! Jokes aside, even ignoring the broader impacts of more driving and just focusing within the company itself, providing limited free parking is "stealing" from those who don't drive (the company is spending resources/opportunity cost on something they don't use), and even on those who have to drive on certain days (they're pushed to getting to work at ridiculous hours to be able to park). With offices where it is actually feasible to commute by public transport (like Lyft's office which seemed to be ~0.5 mile from the nearest BART station and less from many bus routes) and when working at a transportation company, there are alternatives to driving one's own car, so putting a price on parking encourages people to treat it as the scarce resource it is.
brian-armstrong 9y ago
I think a big issue with parking is that people might not even consider that there are alternatives to driving. The car is just a little too comfy. But if everyone is so far from work that they need to drive to get there, that creates so many congestion and environmental issues. This seems like a real weak spot for our culture.
sfaruque 9y ago
Just an observation: Why aren't Lyft's employees using Lyft's ride-sharing service to get to work? I know that's not the point of the article, but if your company owns ~25% of the market share [1], wouldn't it make more sense to instead give your employees "Lyft credits" (or whatever it's called), and have them use the service on a near-daily basis. [1] https://www.usatoday.com/story/tech/news/2017/06/13/uber-market-share-customer-image-hit-string-scandals/102795024/ https://www.usatoday.com/story/tech/news/2017/06/13/uber-mar...
- yeukhon 9y ago
  Or a company bus or commute credit.
- mattnewton 9y ago
  They do, apparently, the comic states they get $100 credit if they have a parking place, or $150 credit if they do not.
  - giarc 9y ago
    That part wasn't quite clear. I thought it meant they received $100 in parking credits for some reason.
- deleted 9y ago
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- CaliforniaKarl 9y ago
  Personally, I think Lyft credits would be bad, for a number of reasons. First off, I'm pretty sure that the value of the credit would be taxable, in the same way that wages are taxable. Specifically, see IRS Publication 15B Section 2, the sub-section on Transportation (Commuting) Benefits (https://www.irs.gov/publications/p15b/ar02.html#en_US_2017_publink1000193740 https://www.irs.gov/publications/p15b/ar02.html#en_US_2017_p...). Lyft credits don't to me appear to be one of the four "Qualified Transportation Benefits" (although paid parking _is_). Nor would it be a de minimis benefit. (To be clear, I'm talking US tax law, as a US corporation.) So, if it's going to be taxed, then you (as the Lyft employee) now have something which you _have_ to use, or else you're going to lose money (in that you've paid taxes for a benefit you're not using). That's a pressure that I'd personally not want to be under. Similarly, I wonder if a permanent discount (all Lyft employees get 50% off) would also be taxable. Since this is all electronic, I don't think it would be that hard to track an employee's Lyft usage, so I don't think the de minimis exception would apply here. Then, come each paycheck, I'd have to remember "Oh, right, I have less money this pay period because I did all those extra Lyfts over the weekend." Continuing the thought experiment, if Lyft did do this, then I most definitely would _not_ want to work or live near Lyft's offices. The reason is, any time I'd want to use Lyft, I'd be competing with all of the Lyft employees who are also using the service. I could see that increasing the chances of surge pricing switching on. That could maybe be minimized by nudging drivers to congregate around Lyft's office, but that would then deprive other areas of drivers. So too many problems, in my opinion.
brianpan 9y ago
Obviously parking is not free. You can just look at the paid lots all around. Or look at the assessment of the headquarters purchase. You might as well "investigate" whether free work shuttles are actually free.
julienb_sea 9y ago
This is quite bizarre to me. In city centers, very few if any office buildings in any industry offer free parking. My company in Seattle will subsidize our ~280/mo parking by 100. I have never heard of a building in downtown Seattle charging under 200 a month for parking, even outdoor surface lots are around 200 monthly. Is it not a bit obvious that free parking dramatically encourages driving over public transit? Parking demand must grow as a company grows, while its parking structure generally is fixed. Increasing the cost is the only way to effectively manage the situation. The alternative from my company versus the parking subsidy is a free unlimited public transit card. Most people choose to take either light rail or bus, and choose their living situations so as to take advantage of those options.
- closeparen 9y ago
  The city center of San Francisco (for public transit purposes) is a small, eastern portion of the Market St corridor, several miles from the site being discussed.
ars 9y ago
Asking me to pay for parking is the same as saying "please don't come here unless you absolutely have to". And that's exactly what I do - I almost never go anywhere that makes you pay for parking. Downtown, or to visit congested cities for example. Or to small stores on roads with parking meters. Are those places happier without me? Maybe. Depends on if they value whatever economic activity I would produce over their poor traffic management. Would I use public transportation? After trying it for a while in a city that is widely considered among the top 5 in the world for public transport my answer is a resounding: NO! Public transport is horrible, even when it is the best humans are able to make it. I feel bad for those people who have no other choice, and I am determined to never live in a city that requires it.
- throwaway91111 9y ago
  Hey stay away, better for us pedestrians.
- wyager 9y ago
  The only city in the world that I've been to that has what I would consider "good" public transport is Hong Kong. In comparison, the NY subway system is dirty, beat up, hot, infrequent, slow, and full of aggressive panhandlers.
  - nradov 9y ago
    Vienna (Wien) also seems good.
  - rishabhparikh 9y ago
    I had a great time on Tokyo public transport (excluding rush hour on the busiest lines, but even that was fun in a way).
- Veratyr 9y ago
  > After trying it for a while in a city that is widely considered among the top 5 in the world for public transport my answer is a resounding: NO! Which city, out of curiosity? The cities widely considered to be among the top 5 are pretty universally a pain to get around in a car. Asia and Europe aren't exactly car friendly.
nsarafa 9y ago
Love the animated comic format of this post. Well done, Bloomberg
mahyarm 9y ago
You need about $250 minimum in credits to make a $12/day commute viable via lyft line. If they gave everyone $250/month in credits, I bet the parking issue would of reduced itself significantly.
deleted 9y ago
[deleted]
hazelnut 9y ago
The story telling and gifs are really outstanding. Congrats to Bloomberg. What's not so nice is ... it's completely not accessible. If you achieve that - hats off
- chubs 9y ago
  Would alt tags on the images solve that? I'm all for interesting new ways to tell the news (previously worked with the guy at news corp au who was in charge of trying that stuff out)
  - deleted 9y ago
    [deleted]
- dr_hooo 9y ago
  I liked the concise way the story was told - the text was short, to the point, without much fluff. On the other hand, I was actually a bit annoyed by the whole comic thing: why is a comic necessary to present a rather simple idea to an adult - tt felt kind of condescending. The drawings didn't really add anything to the story, and I found the animations distracting. ...now get off my lawn :)
  - kaybe 9y ago
    I wish the animations could be switched off. They're distracting and don't add anything. Didn't we just have that discussion on the compression thread?
- adam-fn 9y ago
  While I don't see the artist credited, there are strong similarities to the wonderful https://catandgirl.com/ https://catandgirl.com/ (c.f. the vampire in the car, the tongue on the guy reading the book).
sharkweek 9y ago
My wife's company just pays people bonuses to take the bus/ride a bike/walk/run/whathaveyou to work. Employees get a small bonus literally every day they utilize alternative transportation. It's not much for each commute, but over the course of a month, it ends up being a few hundred bucks for some people. My wife used to drive to work, but is now riding her bike. I am 99% sure she loves the bike commute so much now that she wouldn't revert back even if the small bonus got taken away.
- hycaria 9y ago
  It's great ! But it's also very saddening that people need incitation from companies to stop driving to work and can't make such healthy, environment-friendly decisions themselves.
  - tomjen3 9y ago
    Driving is awesome, I am way better protected in the event something goes wrong, and I don't have to care about the weather. This isn't popular here, but I have been indoctrinated by environmental bullshit as a kid and teen and I am done with that. I pay high gas taxes and if that can't more than offset the environmental impact whomever is in charge should be fired for incompetence.
    - epistasis 9y ago
      >I pay high gas taxes and if that can't more than offset the environmental impact whomever is in charge should be fired for incompetence. Edit: comment predicated on the assumption that this is in California, where Lyft is located No, you don't pay high taxes, and second, political forces are such that gas taxes can not be raised to what they should be to prevent your "firing for incompetence." The politics don't work that way.
    - 45h34jh53k4j 9y ago
      Friend, all the money is the world cannot undo environmental damage. Your tax dollars for gas are for revenue, not to offset environmental damage. Accepting this is very important. If you have any doubts, throw all your greenbacks into a volcano and let us know if it stops erupting.
FullMtlAlcoholc 9y ago
Am I crazy or is it ridiculous that a ride-sharing company didn't give their employees free Lyft credits to alleviate the situation? You would think that would be one of the perks of working for Lyft. I am also confused as to why it was called free parking. Is employee parking not considered as part of compensation? I've worked at offices before that used public lots and the employer purchased parking passes for everyone. Also, a bit off topic, but biking is not a panacea for everyone. I tried cycling my 18 mile commute along the PCH for 1.5 years. By the end of it, I was really turned off by biking. I like to play basketball, hike, and go open ocean swimming. I finally quit cycling to work because I had dead legs due to musclr fatigue and couldn't enjoynmy preferred recreational activities. Also, I sweat very easily. Luckily my office at the time had a shower.
- kelnos 9y ago
  > Am I crazy or is it ridiculous that a ride-sharing company didn't give their employees free Lyft credits to alleviate the situation? You would think that would be one of the perks of working for Lyft. I'm surprised that/if they didn't have that perk before the parking brouhaha, but even if they didn't, non-parkers got $150/mo just for not parking there, so they could certainly spend that on Lyft rides. Though considering that a month is around 23 working days, that means they only have a little over $3 per ride, which won't get them to and from work every day in the month... unless they take Line and live within walking distance anyway...
  - FullMtlAlcoholc 9y ago
    Even though it seemed to work out overall for the company, it seems like employee carpooling via Lyft Line would be a less risky solution, especially at the end of the day when you all can be picked up at the same location.
- CaliforniaKarl 9y ago
  >Am I crazy or is it ridiculous that a ride-sharing company didn't give their employees free Lyft credits to alleviate the situation? I can totally understand Lyft not offering in-app credits, for a number of reasons: 1: If a Lyft employee is unable to get a Lyft, for whatever reason (like, no drivers nearby, or whatever), then they're gonna be pissed, because they won't be able to use their Lyft credit for an alternate option (where another person could also check other options, like Uber, taxi, calling a friend, etc.). 2: Lyft would probably still have to deduct payroll taxes on the credit paid to the employee. That would really suck for Lyft employees who don't use Lyft enough to use up the credit (by, for example, taking public transit). See https://www.irs.gov/businesses/small-businesses-self-employed/employee-benefits https://www.irs.gov/businesses/small-businesses-self-employe...
chrissnell 9y ago
Had an idea while reading the story: if I worked for Lyft during that time, I would have created an app that made it simple to rent out your "owned" spot to fellow employees. It would be easier and faster than the Facebook group, with built-in payment. The cost for the app? Parking space owners have to let me use their space for one workday a year, with a prearranged date of my choice. If everybody signed up, I would have a space almost every day, free of charge.
- mfkp 9y ago
  Do you mean "let me use their space for a week"? There's only 53 parking spaces, and approximately 260 working days per year.
mreome 9y ago
Why not just treat the assigned parking a standard perk (considered in the overhead cost of an employee) and offer a cash bonus to those who elect to not have a spot? That would maintain the perception of the parking being free, while allowing for a reduction in usage based on the same value assessment described in the article.
- bradstewart 9y ago
  That's how a number of companies in Austin do it.
CaliforniaKarl 9y ago
I work at "the university down the peninsula" (https://news.ycombinator.com/item?id=14975881 https://news.ycombinator.com/item?id=14975881). Stanford—in my opinion—has a similar situation. We are affected by the "General Use Permit" (https://gup.stanford.edu/the-project/reference-documents https://gup.stanford.edu/the-project/reference-documents) which, among other things, limits the number of parking spaces that campus can have. As a result, Stanford has a number of programs to encourage people to commute: • Paying for a Caltrain Go Pass (https://transportation.stanford.edu/transit/free-transit-incentives/caltrain-go-pass https://transportation.stanford.edu/transit/free-transit-inc...) and VTA Eco Pass (https://transportation.stanford.edu/transit/free-transit-and-incentives/vta-eco-pass https://transportation.stanford.edu/transit/free-transit-and...). • Running the AE-F (https://transportation.stanford.edu/marguerite/aef https://transportation.stanford.edu/marguerite/aef) and EB (https://transportation.stanford.edu/marguerite/eb https://transportation.stanford.edu/marguerite/eb) lines to the East Bay. • Coordinating AC Transit for the two Dumbarton Express lines (https://dumbartonexpress.com https://dumbartonexpress.com), and the U line (https://transportation.stanford.edu/transit/free-transit-incentives/line-u https://transportation.stanford.edu/transit/free-transit-inc...) lines. • Various car- and van-pooling options (https://transportation.stanford.edu/rideshare https://transportation.stanford.edu/rideshare). And there's also the various Marguerite lines (X Express & Limited, Y Express and Limited, and S) that supplement normal service. There're also other things that I've forgotten about. All of those options are pretty well used, and it shows that for the main use cases, it is possible to "charge for free parking", but I think the important thing is that you do have to have some external constraint. In Lyft's case, it was a lack of spaces. In Stanford's case, it's a negotiated restriction. Either way, that avoids the "Facebook alternative", where you don't have any outside reason you can point to. The best example of this is the Stanford Research Park: If you're a Stanford employee who works off-campus (and the Stanford Research Park counts as off-campus), then you don't qualify for the $300 yearly credit, even if you use bus/train/vanpool all the time (see https://transportation.stanford.edu/commute-club/about-commute-club/are-you-eligible https://transportation.stanford.edu/commute-club/about-commu...). So I guess the lesson (or at least the correlation) is, you need some external restriction, or else "most" people will drive!
jacobr 9y ago
Gave me an idea of dynamic pricing for public parking, like the surge prices of ride sharing services. Maybe this already exists somewhere? If there are only a handful spots left, the price would be really high. If a parking lot is not that popular it will automatically be cheaper. Environmentally friendly cars could get a discount. Instead of reserved parking spots, the spot would know for instance if it's never used during working hours and the prices would adjust to optimize the fill rate of all spots. Residents would get a discount for spots close to home. I guess most cities have zones with different fees, and often free parking on weekends and nights. This would instead adjust it automatically, maybe even adjust for popularity of a particular group of spots.
- TulliusCicero 9y ago
  IIRC San Francisco has experimented successfully with dynamic pricing. The main problem with such initiatives is that most drivers reflexively despise them, and will create a big political stink.
ryan-allen 9y ago
In the City of Melbourne in Australia, most parking that you could use all day is not free. You can either get in by 10am and pay $20 per day, or pay around $100 per day if you arrive after that. There's still heaps of cars in the city.
pouetpouet 9y ago
some cities experiment with dynamic parking pricing http://sfpark.org/how-it-works/pricing/ http://sfpark.org/how-it-works/pricing/
CalRobert 9y ago
Relevant to a lot of people here - California's Parking Cashout law requires your employer to reimburse you what they would spend on your parking if you don't use it. This applies in the (somewhat narrow) situation where you not parking has a direct impact on what the company spends - i.e. they rent a spot in a garage. When I worked in Santa Monica it was a couple hundred bucks a month - cycling was nicer anyway, too. https://www.arb.ca.gov/planning/tsaq/cashout/cashout.htm https://www.arb.ca.gov/planning/tsaq/cashout/cashout.htm
- SilasX 9y ago
  So wait, employers have to track how you get to work each day? Or just classify you as "always" vs "never" parking?
  - CalRobert 9y ago
    You just don't get the spot. In my case I just didn't get the card that enabled access to the garage. It's not applicable where the employer just has one big lot and isn't paying per space, generally.
sickbeard 9y ago
Why did the price of the parking spots keep going up though? Why couldn't lyft keep them at 200$?

148 points by victorvation 9y ago

This program isn't free for Lyft -- @ 1,000 employees and $375/space/month for each of the 53 spaces, the monthly program cost is $35K per month (with the subsidies net of revenue), or 420K a year in cash burn!!!! IMHO, they'd be better off shutting down the lot and using it as a picnic area / common area for everyone to enjoy.

djrogers 9y ago
I’m not sure I follow your numbers or your logic - Lyft charged their employees, where is the $35k/mo cost to Lyft coming from?
- gwern 9y ago
  Presumably that's originally coming as part of the total cost of renting the building+mandatory parking lot. :)

Nav_Panel 9y ago

This is not a very radical idea. It is known that people are averse to losing things they already have (even in exchange for equal or greater benefit). I'm glad it worked out for Lyft without too many ruffled feathers, at least according to the comic. I'm glad this sort of idea continues to get media exposure. It needs it. An example, it is absurd to me (and most urbanist types) that Manhattan still has free street parking and that all the East River bridges are free. Congestion pricing in Lower Manhattan was on the table during the Bloomberg era, but never made it through. It should have.

blacksqr 9y ago
Congestion pricing proposals for publicly-owned infrastructure always run into the same problem: taxpayers paid for the building of the infrastructure, they already own it. Charging what the market will bear effectively turns the infrastructure over to the relatively wealthy to use. Making people watch as the rich get exclusive use of the infrastructure every taxpayer paid for never goes over well.
- TulliusCicero 9y ago
  But what if charging what the market will bear means the rich are paying for the cost of the thing and then some? Anyway, my impression is that opposition to things like congestion fees come more from affluent commuting suburbanites than the poor (who probably already rely on transit anyway).
  - kaybe 9y ago
    Doesn't help if I don't get to use it..
    - TulliusCicero 9y ago
      But what if you don't need to because the money goes to fund alternative methods?
      - blacksqr 9y ago
        Will those alternative methods also be congestion priced? Are you just setting up an infinite regression? If there's broad demand for increased capacity, why not just raise everybody's taxes to pay for it, and let everybody use it?
        Nav_Panel 9y ago
        No, because the point is that cars specifically are Pretty Bad for cities (noise, air quality, inefficient use of space, dangerous) and should be discouraged (and economic incentives work). Mass transit is generally far less bad and should be encouraged by economic means. NYC sort-of does this by not using zone fares, so long trips from far-away areas (read: poor parts of the city) cost as much as a brief trip through a rich area.
        TulliusCicero 9y ago
        Because of geometry: cars do not scale well in cities. Only so much land to go around, you want (need, really) people to use more space-efficient modes. Supporting cars is particularly expensive compared to other modes because of how much space cars take to move around and park.

mc32 9y ago

Doesn't the university down the peninsula charge everyone monthly/yearly parking fees to reduce driving and encourage people to take public transit/bike or live on campus? Most FinDi commuters have to pay for their spots. It's widely used and well known stick to get people to carpool or take alternative means to work.

CaliforniaKarl 9y ago
It's Stanford, and yes to most of that, but no to the "live on campus" part. 8-)

brwnll 9y ago

With so many companies offering employees public transportation passes for commuting, I'd love to see Lyft/Uber create the ability for employers to offer free/reduced fare office commutes (within a determined range). AFAIK the only option they have is to give blanket monthly credits.

deleted 9y ago
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misingnoglic 9y ago
My girlfriend is starting a PhD at UCSF, and if they have to commute between 11pm and 6am the school will pay for the Uber/Lyft ride up to a certain amount. I'm not sure how it's facilitated but it's a good idea for sure.

tixocloud 9y ago

Tolls continue to represent an effective way of managing congestion in large cities but it's only if the community will be willing to accept it. Better transportation alternatives need to be provided in addition to the introduction of tolls to appease everyone.

noahmbarr 9y ago

You can't pay for that type of advertising.

rgbrenner 9y ago

The facebook character had the right answer. These companies have products that create more value than running a paid parking lot... why would you trade an employee on a product like that for a few dollars in parking fees.

johnhess 9y ago
The point of the article is that by making something scarce free, the company was in effect "rationing by the queue", an inefficient way to handle things. Those unwilling to get there early had a bad time. Instead they said, "Hey, we were giving the average employee $100/mo in parking. We're gonna keep doing that in the form of cash. But, to fund that extra 100 you're now getting in cash, anyone who wants to use the lot has to pay its market value." In short, instead of providing a "flakey parking availability" they provided cash. It's a lot (a lot... get it?) like selling the lot and giving the proceeds to employees. This isn't always the best idea (sometimes, similar schemes can be socially unjust), but from an efficiency standpoint, it's hard to beat. I hear what you're saying about pissing people off, but this should do the opposite. Sure, some folks might irrationally like jockeying for position or be early risers. But the company never intended to say "this benefit is for early risers". The intended it as a benefit to all employees and now it is.
- rgbrenner 9y ago
  yes, I read the cartoon. There's nothing new in it -- these are all well known things (like 100 year old things). It's not clear that the companies they shopped the idea around to had a shortage of parking. Queuing costs are costs that the employees who are trying to park are imposing on themselves. A parking fee is a cost that is being imposed on the employees by the employer. It's reasonable for employees to react differently to those costs. If you're building a widely profitable business (like facebook), the better answer is to just build a larger parking lot. Just like lyft eventually did, and abandoned this bad idea.
  - throwaway91111 9y ago
    There's already too much damn parking. Stop driving to work. Live too far away? Convince your company to move to a place with sane housing costs. Facebook has the advantage of building in the burbs where there's already a glut of parking and people expect more.

obilgic 9y ago

What if experiment is conducted like this: 1. 53 top bidders pay and get their spot. 2. total money collected is shared between everyone who doesn't park

ballenf 9y ago
I was waiting for just that outcome and was also surprised that's not where it ended up. Would have addressed the income disparity complaint. Maybe it smells too capitalistic?
- sowbug 9y ago
  I could see a concern that this would either look like a general partnership where the recipients of funds turned out to be liable if someone got hurt on the property, or else need to be a corporate entity of some kind with the recipients as dividend-eligible shareholders, with all the fun paperwork and tax-reporting requirements that come along with that. By the way I'm not sure about the capitalistic label. The recipients would do nothing to earn the money, did they?
  - Operyl 9y ago
    Well, could argue they had to do more to get to work? Unless of course they used Lyft to get a ride ..
- Gaelan 9y ago
  That encourages driving up the price then dropping out to increase how much you get.
  - wyager 9y ago
    You can structure your auction in different ways to discourage this sort of bad behavior. For example: https://en.m.wikipedia.org/wiki/Vickrey–Clarke–Groves_auction https://en.m.wikipedia.org/wiki/Vickrey–Clarke–Groves_auctio... There's lots of auction theory describing good ways to sell things like parking spaces.

shahbaby 9y ago

It "worked" because people paid or found an alternative? Who's going to quit their job over parking? Seems like the standard formula for a business news article now is to repackage common sense ideas as something new and exciting. Charged for parking? Let's make a comic about how innovative that was.

ajhurliman 9y ago
Not really, if they're free and you just randomly give them out then it doesn't allow the power of the market to sort out who really wants a spot vs. who doesn't really care.
- shahbaby 9y ago
  How is paying with money any more fair than paying with time? I'd personally prefer random distribution over selling to the highest bidder. Does every single thing really have to be for sale?
  - lmm 9y ago
    Money isn't consumed, the money paid can be passed out to other employees as raises. Whereas time spent waiting in line is a dead-weight loss. (Ok, it's not a 100% loss since you might be able to do something somewhat fun with that time, e.g. maybe you listen to a podcast while you're sitting in the parking lot. But it's not an ideal way to spend your time, and there's no way for anyone to get their time back)
ghaff 9y ago
>Who's going to quit their job over parking? Maybe not over just parking but because it's really inconvenient/expensive to go into the office--and you need to do so on a daily basis--absolutely. Which not being able to easily park at any time can be a component of.

AndyNemmity 9y ago

Demand is a fallacy because they compel you to come into the building. If they allowed everyone to choose to work from home, or from another location, then it would have something interesting to say about it. But the demand is artificial in that context, forcing people to exist at that office, and yet not allowing them the means to do so with their mode of travel of choice by not providing sufficient parking.

revicon 9y ago
I didn't see anything on the linked page that Lyft compelled employees to come into the office. Did I miss something that you read?
- AndyNemmity 9y ago
  Most companies do by default, apologies if I'm incorrect, but does Lyft allow unlimited work from home?
friedman23 9y ago
Wow, you didn't even take econ 101 did you? Do you know what substitutes are? "Demand is a fallacy" Probably the dumbest thing I've ever read. Do you think there is no demand for food? Is demand for food a fallacy? Jesus.
dbaupp 9y ago
> yet not allowing them the means to do so with their mode of travel of choice by not providing sufficient parking They also don't provide a runway and hangar space, nor a marina, and probably not a SpaceX landing pad either! People can't commute with their mode of travel of choice! Jokes aside, even ignoring the broader impacts of more driving and just focusing within the company itself, providing limited free parking is "stealing" from those who don't drive (the company is spending resources/opportunity cost on something they don't use), and even on those who have to drive on certain days (they're pushed to getting to work at ridiculous hours to be able to park). With offices where it is actually feasible to commute by public transport (like Lyft's office which seemed to be ~0.5 mile from the nearest BART station and less from many bus routes) and when working at a transportation company, there are alternatives to driving one's own car, so putting a price on parking encourages people to treat it as the scarce resource it is.

brian-armstrong 9y ago

I think a big issue with parking is that people might not even consider that there are alternatives to driving. The car is just a little too comfy. But if everyone is so far from work that they need to drive to get there, that creates so many congestion and environmental issues. This seems like a real weak spot for our culture.

sfaruque 9y ago

Just an observation: Why aren't Lyft's employees using Lyft's ride-sharing service to get to work? I know that's not the point of the article, but if your company owns ~25% of the market share [1], wouldn't it make more sense to instead give your employees "Lyft credits" (or whatever it's called), and have them use the service on a near-daily basis. [1] https://www.usatoday.com/story/tech/news/2017/06/13/uber-market-share-customer-image-hit-string-scandals/102795024/ https://www.usatoday.com/story/tech/news/2017/06/13/uber-mar...

yeukhon 9y ago
Or a company bus or commute credit.
mattnewton 9y ago
They do, apparently, the comic states they get $100 credit if they have a parking place, or $150 credit if they do not.
- giarc 9y ago
  That part wasn't quite clear. I thought it meant they received $100 in parking credits for some reason.
deleted 9y ago
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CaliforniaKarl 9y ago
Personally, I think Lyft credits would be bad, for a number of reasons. First off, I'm pretty sure that the value of the credit would be taxable, in the same way that wages are taxable. Specifically, see IRS Publication 15B Section 2, the sub-section on Transportation (Commuting) Benefits (https://www.irs.gov/publications/p15b/ar02.html#en_US_2017_publink1000193740 https://www.irs.gov/publications/p15b/ar02.html#en_US_2017_p...). Lyft credits don't to me appear to be one of the four "Qualified Transportation Benefits" (although paid parking _is_). Nor would it be a de minimis benefit. (To be clear, I'm talking US tax law, as a US corporation.) So, if it's going to be taxed, then you (as the Lyft employee) now have something which you _have_ to use, or else you're going to lose money (in that you've paid taxes for a benefit you're not using). That's a pressure that I'd personally not want to be under. Similarly, I wonder if a permanent discount (all Lyft employees get 50% off) would also be taxable. Since this is all electronic, I don't think it would be that hard to track an employee's Lyft usage, so I don't think the de minimis exception would apply here. Then, come each paycheck, I'd have to remember "Oh, right, I have less money this pay period because I did all those extra Lyfts over the weekend." Continuing the thought experiment, if Lyft did do this, then I most definitely would _not_ want to work or live near Lyft's offices. The reason is, any time I'd want to use Lyft, I'd be competing with all of the Lyft employees who are also using the service. I could see that increasing the chances of surge pricing switching on. That could maybe be minimized by nudging drivers to congregate around Lyft's office, but that would then deprive other areas of drivers. So too many problems, in my opinion.

brianpan 9y ago

Obviously parking is not free. You can just look at the paid lots all around. Or look at the assessment of the headquarters purchase. You might as well "investigate" whether free work shuttles are actually free.

julienb_sea 9y ago

This is quite bizarre to me. In city centers, very few if any office buildings in any industry offer free parking. My company in Seattle will subsidize our ~280/mo parking by 100. I have never heard of a building in downtown Seattle charging under 200 a month for parking, even outdoor surface lots are around 200 monthly. Is it not a bit obvious that free parking dramatically encourages driving over public transit? Parking demand must grow as a company grows, while its parking structure generally is fixed. Increasing the cost is the only way to effectively manage the situation. The alternative from my company versus the parking subsidy is a free unlimited public transit card. Most people choose to take either light rail or bus, and choose their living situations so as to take advantage of those options.

closeparen 9y ago
The city center of San Francisco (for public transit purposes) is a small, eastern portion of the Market St corridor, several miles from the site being discussed.

ars 9y ago

Asking me to pay for parking is the same as saying "please don't come here unless you absolutely have to". And that's exactly what I do - I almost never go anywhere that makes you pay for parking. Downtown, or to visit congested cities for example. Or to small stores on roads with parking meters. Are those places happier without me? Maybe. Depends on if they value whatever economic activity I would produce over their poor traffic management. Would I use public transportation? After trying it for a while in a city that is widely considered among the top 5 in the world for public transport my answer is a resounding: NO! Public transport is horrible, even when it is the best humans are able to make it. I feel bad for those people who have no other choice, and I am determined to never live in a city that requires it.

throwaway91111 9y ago
Hey stay away, better for us pedestrians.
wyager 9y ago
The only city in the world that I've been to that has what I would consider "good" public transport is Hong Kong. In comparison, the NY subway system is dirty, beat up, hot, infrequent, slow, and full of aggressive panhandlers.
- nradov 9y ago
  Vienna (Wien) also seems good.
- rishabhparikh 9y ago
  I had a great time on Tokyo public transport (excluding rush hour on the busiest lines, but even that was fun in a way).
Veratyr 9y ago
> After trying it for a while in a city that is widely considered among the top 5 in the world for public transport my answer is a resounding: NO! Which city, out of curiosity? The cities widely considered to be among the top 5 are pretty universally a pain to get around in a car. Asia and Europe aren't exactly car friendly.

nsarafa 9y ago

Love the animated comic format of this post. Well done, Bloomberg

mahyarm 9y ago

You need about $250 minimum in credits to make a $12/day commute viable via lyft line. If they gave everyone $250/month in credits, I bet the parking issue would of reduced itself significantly.

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hazelnut 9y ago

The story telling and gifs are really outstanding. Congrats to Bloomberg. What's not so nice is ... it's completely not accessible. If you achieve that - hats off

chubs 9y ago
Would alt tags on the images solve that? I'm all for interesting new ways to tell the news (previously worked with the guy at news corp au who was in charge of trying that stuff out)
- deleted 9y ago
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dr_hooo 9y ago
I liked the concise way the story was told - the text was short, to the point, without much fluff. On the other hand, I was actually a bit annoyed by the whole comic thing: why is a comic necessary to present a rather simple idea to an adult - tt felt kind of condescending. The drawings didn't really add anything to the story, and I found the animations distracting. ...now get off my lawn :)
- kaybe 9y ago
  I wish the animations could be switched off. They're distracting and don't add anything. Didn't we just have that discussion on the compression thread?
adam-fn 9y ago
While I don't see the artist credited, there are strong similarities to the wonderful https://catandgirl.com/ https://catandgirl.com/ (c.f. the vampire in the car, the tongue on the guy reading the book).

sharkweek 9y ago

My wife's company just pays people bonuses to take the bus/ride a bike/walk/run/whathaveyou to work. Employees get a small bonus literally every day they utilize alternative transportation. It's not much for each commute, but over the course of a month, it ends up being a few hundred bucks for some people. My wife used to drive to work, but is now riding her bike. I am 99% sure she loves the bike commute so much now that she wouldn't revert back even if the small bonus got taken away.

hycaria 9y ago
It's great ! But it's also very saddening that people need incitation from companies to stop driving to work and can't make such healthy, environment-friendly decisions themselves.
- tomjen3 9y ago
  Driving is awesome, I am way better protected in the event something goes wrong, and I don't have to care about the weather. This isn't popular here, but I have been indoctrinated by environmental bullshit as a kid and teen and I am done with that. I pay high gas taxes and if that can't more than offset the environmental impact whomever is in charge should be fired for incompetence.
  - epistasis 9y ago
    >I pay high gas taxes and if that can't more than offset the environmental impact whomever is in charge should be fired for incompetence. Edit: comment predicated on the assumption that this is in California, where Lyft is located No, you don't pay high taxes, and second, political forces are such that gas taxes can not be raised to what they should be to prevent your "firing for incompetence." The politics don't work that way.
  - 45h34jh53k4j 9y ago
    Friend, all the money is the world cannot undo environmental damage. Your tax dollars for gas are for revenue, not to offset environmental damage. Accepting this is very important. If you have any doubts, throw all your greenbacks into a volcano and let us know if it stops erupting.

FullMtlAlcoholc 9y ago

Am I crazy or is it ridiculous that a ride-sharing company didn't give their employees free Lyft credits to alleviate the situation? You would think that would be one of the perks of working for Lyft. I am also confused as to why it was called free parking. Is employee parking not considered as part of compensation? I've worked at offices before that used public lots and the employer purchased parking passes for everyone. Also, a bit off topic, but biking is not a panacea for everyone. I tried cycling my 18 mile commute along the PCH for 1.5 years. By the end of it, I was really turned off by biking. I like to play basketball, hike, and go open ocean swimming. I finally quit cycling to work because I had dead legs due to musclr fatigue and couldn't enjoynmy preferred recreational activities. Also, I sweat very easily. Luckily my office at the time had a shower.

kelnos 9y ago
> Am I crazy or is it ridiculous that a ride-sharing company didn't give their employees free Lyft credits to alleviate the situation? You would think that would be one of the perks of working for Lyft. I'm surprised that/if they didn't have that perk before the parking brouhaha, but even if they didn't, non-parkers got $150/mo just for not parking there, so they could certainly spend that on Lyft rides. Though considering that a month is around 23 working days, that means they only have a little over $3 per ride, which won't get them to and from work every day in the month... unless they take Line and live within walking distance anyway...
- FullMtlAlcoholc 9y ago
  Even though it seemed to work out overall for the company, it seems like employee carpooling via Lyft Line would be a less risky solution, especially at the end of the day when you all can be picked up at the same location.
CaliforniaKarl 9y ago
>Am I crazy or is it ridiculous that a ride-sharing company didn't give their employees free Lyft credits to alleviate the situation? I can totally understand Lyft not offering in-app credits, for a number of reasons: 1: If a Lyft employee is unable to get a Lyft, for whatever reason (like, no drivers nearby, or whatever), then they're gonna be pissed, because they won't be able to use their Lyft credit for an alternate option (where another person could also check other options, like Uber, taxi, calling a friend, etc.). 2: Lyft would probably still have to deduct payroll taxes on the credit paid to the employee. That would really suck for Lyft employees who don't use Lyft enough to use up the credit (by, for example, taking public transit). See https://www.irs.gov/businesses/small-businesses-self-employed/employee-benefits https://www.irs.gov/businesses/small-businesses-self-employe...

chrissnell 9y ago

Had an idea while reading the story: if I worked for Lyft during that time, I would have created an app that made it simple to rent out your "owned" spot to fellow employees. It would be easier and faster than the Facebook group, with built-in payment. The cost for the app? Parking space owners have to let me use their space for one workday a year, with a prearranged date of my choice. If everybody signed up, I would have a space almost every day, free of charge.

mfkp 9y ago
Do you mean "let me use their space for a week"? There's only 53 parking spaces, and approximately 260 working days per year.

mreome 9y ago

Why not just treat the assigned parking a standard perk (considered in the overhead cost of an employee) and offer a cash bonus to those who elect to not have a spot? That would maintain the perception of the parking being free, while allowing for a reduction in usage based on the same value assessment described in the article.

bradstewart 9y ago
That's how a number of companies in Austin do it.

CaliforniaKarl 9y ago

I work at "the university down the peninsula" (https://news.ycombinator.com/item?id=14975881 https://news.ycombinator.com/item?id=14975881). Stanford—in my opinion—has a similar situation. We are affected by the "General Use Permit" (https://gup.stanford.edu/the-project/reference-documents https://gup.stanford.edu/the-project/reference-documents) which, among other things, limits the number of parking spaces that campus can have. As a result, Stanford has a number of programs to encourage people to commute: • Paying for a Caltrain Go Pass (https://transportation.stanford.edu/transit/free-transit-incentives/caltrain-go-pass https://transportation.stanford.edu/transit/free-transit-inc...) and VTA Eco Pass (https://transportation.stanford.edu/transit/free-transit-and-incentives/vta-eco-pass https://transportation.stanford.edu/transit/free-transit-and...). • Running the AE-F (https://transportation.stanford.edu/marguerite/aef https://transportation.stanford.edu/marguerite/aef) and EB (https://transportation.stanford.edu/marguerite/eb https://transportation.stanford.edu/marguerite/eb) lines to the East Bay. • Coordinating AC Transit for the two Dumbarton Express lines (https://dumbartonexpress.com https://dumbartonexpress.com), and the U line (https://transportation.stanford.edu/transit/free-transit-incentives/line-u https://transportation.stanford.edu/transit/free-transit-inc...) lines. • Various car- and van-pooling options (https://transportation.stanford.edu/rideshare https://transportation.stanford.edu/rideshare). And there's also the various Marguerite lines (X Express & Limited, Y Express and Limited, and S) that supplement normal service. There're also other things that I've forgotten about. All of those options are pretty well used, and it shows that for the main use cases, it is possible to "charge for free parking", but I think the important thing is that you do have to have some external constraint. In Lyft's case, it was a lack of spaces. In Stanford's case, it's a negotiated restriction. Either way, that avoids the "Facebook alternative", where you don't have any outside reason you can point to. The best example of this is the Stanford Research Park: If you're a Stanford employee who works off-campus (and the Stanford Research Park counts as off-campus), then you don't qualify for the $300 yearly credit, even if you use bus/train/vanpool all the time (see https://transportation.stanford.edu/commute-club/about-commute-club/are-you-eligible https://transportation.stanford.edu/commute-club/about-commu...). So I guess the lesson (or at least the correlation) is, you need some external restriction, or else "most" people will drive!

jacobr 9y ago

Gave me an idea of dynamic pricing for public parking, like the surge prices of ride sharing services. Maybe this already exists somewhere? If there are only a handful spots left, the price would be really high. If a parking lot is not that popular it will automatically be cheaper. Environmentally friendly cars could get a discount. Instead of reserved parking spots, the spot would know for instance if it's never used during working hours and the prices would adjust to optimize the fill rate of all spots. Residents would get a discount for spots close to home. I guess most cities have zones with different fees, and often free parking on weekends and nights. This would instead adjust it automatically, maybe even adjust for popularity of a particular group of spots.

TulliusCicero 9y ago
IIRC San Francisco has experimented successfully with dynamic pricing. The main problem with such initiatives is that most drivers reflexively despise them, and will create a big political stink.

ryan-allen 9y ago

In the City of Melbourne in Australia, most parking that you could use all day is not free. You can either get in by 10am and pay $20 per day, or pay around $100 per day if you arrive after that. There's still heaps of cars in the city.

pouetpouet 9y ago

some cities experiment with dynamic parking pricing http://sfpark.org/how-it-works/pricing/ http://sfpark.org/how-it-works/pricing/

CalRobert 9y ago

Relevant to a lot of people here - California's Parking Cashout law requires your employer to reimburse you what they would spend on your parking if you don't use it. This applies in the (somewhat narrow) situation where you not parking has a direct impact on what the company spends - i.e. they rent a spot in a garage. When I worked in Santa Monica it was a couple hundred bucks a month - cycling was nicer anyway, too. https://www.arb.ca.gov/planning/tsaq/cashout/cashout.htm https://www.arb.ca.gov/planning/tsaq/cashout/cashout.htm

SilasX 9y ago
So wait, employers have to track how you get to work each day? Or just classify you as "always" vs "never" parking?
- CalRobert 9y ago
  You just don't get the spot. In my case I just didn't get the card that enabled access to the garage. It's not applicable where the employer just has one big lot and isn't paying per space, generally.

sickbeard 9y ago

Why did the price of the parking spots keep going up though? Why couldn't lyft keep them at 200$?