Piggyback on Idle Ride-Sourcing Drivers for Integrated On-Demand and Flexible Intracity Parcel Delivery Services

Abstract: This paper investigates the spatial pricing and fleet management strategies for an integrated platform that provides both ride-sourcing services and intracity parcel delivery services over a transportation network utilizing the idle time of ride-sourcing drivers. Specifically, the integrated platform simultaneously offers on-demand ride-sourcing services for passengers and multiple modes of parcel delivery services for customers, including: (1) on-demand delivery, where drivers immediately pick up and deliver parcels upon receiving a delivery request; and (2) flexible delivery, where drivers can pick up (or drop off) parcels only when they are idle and waiting for the next ride-sourcing request. A continuous-time Markov Chain (CTMC) model is proposed to characterize the status change of drivers under joint movement of passengers and parcels over the transportation network with limited vehicle capacity, where the service quality of ride-sourcing services, on-demand delivery services, and flexible delivery services are rigorously quantified. Building on the CTMC model, incentives for ride-sourcing passengers, delivery customers, drivers, and the platform are captured through an economic equilibrium model, and the optimal spatial pricing decisions of the platform are derived by solving a non-convex profit-maximizing problem. We prove the well-posedness of the model and develop a tailored algorithm to compute the optimal decisions of the platform. Furthermore, we validate the proposed model in a comprehensive case study for San Francisco, demonstrating that joint management of ride-sourcing services and intracity package delivery services can lead to a Pareto improvement that benefits all stakeholders in the integrated ride-sourcing and parcel delivery market under realistic parcel and passenger demand patterns.