The first time Uber Technologies Inc. Strategic Advisor David Plouffe saw Manila’s traffic-laden streets, he thought, “huge parking lots!”
Plouffe is in Manila to attend the Asia Pacific Economic Cooperation (APEC) CEO summit on Monday.
During an ‘insight’ session of the APEC summit in the Makati financial district on Monday, Plouffe said the new economic concept called “sharing economy” could be a solution to the Philippines’ economic challenges, particularly Manila’s traffic woes.
Sharing economy is an economic business model that allows peer-to-peer-based sharing of access to goods and services. It is most likely to be practiced when the price of a particular asset is high and the asset is not fully utilized all the time.
The US-based ride-sharing company, Uber, adopts the concept, allowing people to ride cars owned by others. At the same time, the ride-sharing company allows car-owners to earn extra by driving around other people for a fee, at a time convenient to them.
Plouffe said sharing economy is now changing consumer behavior in 58 countries, where the five-year-old ride-sharing company operates.
“This is the case in most cities. Our cities look like parking lots and they move in traffic jams,” said Plouffe.
He said ride-sharing, in particular, could help solve the problem of congested cities, especially Metro Manila.
In the next 10 years, he sees an unprecedented amount of urban mitigation unfolding.
“People are moving into cities at historic rates, that’s not going to change,” said Plouffe, an American political strategist, who was not only the vice president of Uber at the firm’s inception, but was also campaign manager for Barack Obama’s successful presidential bid in 2008, and later, the US President’s senior adviser in the White House, and long-time Democratic Party campaign consultant.
Plouffe noted that some cities have the ability to add new public transport lines and new roads, but most cities like the Philippines do not.
“You already have too much congestion, and more people are coming in. Something’s got to give,” Plouffe stressed.
He cited carpooling as a first-step solution to congestion problems experienced by most cities, the strategy would cut down the number of cars on the road.
Plouffe said 10 percent of people under 30 have given up their cars, based on an Uber study.
“This something that a shared economy business, such as Uber, is currently doing in the market—it is changing behavior,” Plouffe said.
He said Uber and its competitors alike are helping prevent drunk-driving accidents, as people can avail of a ride to get them home safely when intoxicated instead of driving themselves.
“In our research, people under 25 or 30, when they live in an urban area where a service like Uber or one of our competitors is available, they don’t even think about driving if they’re going to have a drink. It doesn’t even cross their mind anymore because they can press a button and get home safely,” he said.