Dynamic Pricing for User-Based Rebalancing in Free-Floating Vehicle Sharing: A Real-World Case

Nout Neijmeijer, Frederik Schulte, Kevin Tierney, Henk Polinder, Rudy R. Negenborn

Research output: Chapter in Book/Conference proceedings/Edited volumeConference contributionScientificpeer-review

Abstract

Dynamic pricing can be used for better fleet distribution in free-floating vehicle sharing (FFVS), and thus increase utilization and revenue for the provider by reducing supply-demand asymmetry. Supply-demand asymmetry refers to the existence of an undersupply of vehicles at some locations at the same time as underutilization of vehicles at other locations. We propose to use dynamic pricing as an instrument to incentivize users to rebalance these vehicles from low demand locations to high demand locations. Despite significant research in rebalancing vehicle sharing, the literature so far lacks experimental results on dynamic pricing in free-floating vehicle sharing. We propose to use an algorithm that minimizes the differences in the idle time of vehicles. The algorithm is tested in a real-life experiment that was conducted in cooperation with an FFVS provider. The results of the experiment are not statistically significant, but they clearly indicate that even slight differences in pricing and a simple algorithm can already influence user-behavior to counter supply-demand asymmetry. Improving the existing algorithm with more experimental research is advised to further uncover the potential of this strategy.

Original languageEnglish
Title of host publicationComputational Logistics
Subtitle of host publicationProceedings of the 11th International Conference, ICCL 2020
EditorsEduardo Lalla-Ruiz, Martijn Mes, Stefan Voß
Place of PublicationCham, Switzerland
PublisherSpringer
Pages443-456
ISBN (Electronic)978-3-030-59747-4
ISBN (Print)978-3-030-59746-7
DOIs
Publication statusPublished - 2020
Event11th International Conference on Computational Logistics, ICCL 2020 - Enschede, Netherlands
Duration: 28 Sep 202030 Sep 2020

Publication series

NameLecture Notes in Computer Science
Volume12433
ISSN (Print)0302-9743
ISSN (Electronic)1611-3349

Conference

Conference11th International Conference on Computational Logistics, ICCL 2020
CountryNetherlands
CityEnschede
Period28/09/2030/09/20

Keywords

  • Dynamic pricing
  • Free-floating vehicle sharing
  • Living lab
  • Price sensitivity
  • User-based operations
  • User-based rebalancing

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