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

doi:10.1007/978-3-030-59747-4_29

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

^*Corresponding author for this work

Transport Engineering and Logistics

Research output: Chapter in Book/Conference proceedings/Edited volume › Conference contribution › Scientific › peer-review

8 Citations (Scopus)

120 Downloads (Pure)

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 language	English
Title of host publication	Computational Logistics
Subtitle of host publication	Proceedings of the 11th International Conference, ICCL 2020
Editors	Eduardo Lalla-Ruiz, Martijn Mes, Stefan Voß
Place of Publication	Cham, Switzerland
Publisher	Springer
Pages	443-456
ISBN (Electronic)	978-3-030-59747-4
ISBN (Print)	978-3-030-59746-7
DOIs	https://doi.org/10.1007/978-3-030-59747-4_29
Publication status	Published - 2020
Event	11th International Conference on Computational Logistics, ICCL 2020 - Enschede, Netherlands Duration: 28 Sept 2020 → 30 Sept 2020

Publication series

Name	Lecture Notes in Computer Science
Volume	12433
ISSN (Print)	0302-9743
ISSN (Electronic)	1611-3349

Conference

Conference	11th International Conference on Computational Logistics, ICCL 2020
Country/Territory	Netherlands
City	Enschede
Period	28/09/20 → 30/09/20

Bibliographical note

Green Open Access added to TU Delft Institutional Repository 'You share, we take care!' - Taverne project https://www.openaccess.nl/en/you-share-we-take-care

Otherwise as indicated in the copyright section: the publisher is the copyright holder of this work and the author uses the Dutch legislation to make this work public.

Keywords

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

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

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10.1007/978-3-030-59747-4_29

Neijmeijer2020_Chapter_DynamicPricingForUser-BasedRebFinal published version, 2.75 MB

Cite this

Neijmeijer, N., Schulte, F., Tierney, K., Polinder, H., & Negenborn, R. R. (2020). Dynamic Pricing for User-Based Rebalancing in Free-Floating Vehicle Sharing: A Real-World Case. In E. Lalla-Ruiz, M. Mes, & S. Voß (Eds.), Computational Logistics: Proceedings of the 11th International Conference, ICCL 2020 (pp. 443-456). (Lecture Notes in Computer Science; Vol. 12433 ). Springer. https://doi.org/10.1007/978-3-030-59747-4_29

Neijmeijer, Nout ; Schulte, Frederik ; Tierney, Kevin et al. / Dynamic Pricing for User-Based Rebalancing in Free-Floating Vehicle Sharing : A Real-World Case. Computational Logistics: Proceedings of the 11th International Conference, ICCL 2020. editor / Eduardo Lalla-Ruiz ; Martijn Mes ; Stefan Voß. Cham, Switzerland : Springer, 2020. pp. 443-456 (Lecture Notes in Computer Science).

@inproceedings{69e82aafaae8414d917b0ba08c307323,

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

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.",

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note = "Green Open Access added to TU Delft Institutional Repository 'You share, we take care!' - Taverne project https://www.openaccess.nl/en/you-share-we-take-care Otherwise as indicated in the copyright section: the publisher is the copyright holder of this work and the author uses the Dutch legislation to make this work public.; 11th International Conference on Computational Logistics, ICCL 2020 ; Conference date: 28-09-2020 Through 30-09-2020",

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Neijmeijer, N, Schulte, F, Tierney, K, Polinder, H & Negenborn, RR 2020, Dynamic Pricing for User-Based Rebalancing in Free-Floating Vehicle Sharing: A Real-World Case. in E Lalla-Ruiz, M Mes & S Voß (eds), Computational Logistics: Proceedings of the 11th International Conference, ICCL 2020. Lecture Notes in Computer Science, vol. 12433 , Springer, Cham, Switzerland, pp. 443-456, 11th International Conference on Computational Logistics, ICCL 2020, Enschede, Netherlands, 28/09/20. https://doi.org/10.1007/978-3-030-59747-4_29

Dynamic Pricing for User-Based Rebalancing in Free-Floating Vehicle Sharing: A Real-World Case. / Neijmeijer, Nout; Schulte, Frederik; Tierney, Kevin et al.
Computational Logistics: Proceedings of the 11th International Conference, ICCL 2020. ed. / Eduardo Lalla-Ruiz; Martijn Mes; Stefan Voß. Cham, Switzerland: Springer, 2020. p. 443-456 (Lecture Notes in Computer Science; Vol. 12433 ).

Research output: Chapter in Book/Conference proceedings/Edited volume › Conference contribution › Scientific › peer-review

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T1 - Dynamic Pricing for User-Based Rebalancing in Free-Floating Vehicle Sharing

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AU - Schulte, Frederik

AU - Tierney, Kevin

AU - Polinder, Henk

AU - Negenborn, Rudy R.

N1 - Green Open Access added to TU Delft Institutional Repository 'You share, we take care!' - Taverne project https://www.openaccess.nl/en/you-share-we-take-care Otherwise as indicated in the copyright section: the publisher is the copyright holder of this work and the author uses the Dutch legislation to make this work public.

PY - 2020

Y1 - 2020

N2 - 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.

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Neijmeijer N, Schulte F, Tierney K, Polinder H , Negenborn RR. Dynamic Pricing for User-Based Rebalancing in Free-Floating Vehicle Sharing: A Real-World Case. In Lalla-Ruiz E, Mes M, Voß S, editors, Computational Logistics: Proceedings of the 11th International Conference, ICCL 2020. Cham, Switzerland: Springer. 2020. p. 443-456. (Lecture Notes in Computer Science). doi: 10.1007/978-3-030-59747-4_29

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

Abstract

Publication series

Conference

Bibliographical note

Keywords

UN SDGs

Access to Document

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