DEC. 12, 20194:34 PM
SuperShuttle, the shared van ride that has served passengers heading to and from airports worldwide, including Los Angeles International Airport, will cease operations at the end of the year.
The company — which was founded in 1983 to serve LAX and expanded nationwide as well as to Latin America, Canada, Europe and Asia — has been plagued by competition from Uber and Lyft. In recent weeks it has pulled out of airports serving many cities, including Burbank, Sacramento, Phoenix, Baltimore and Minneapolis.
A Tuesday letter from the company to a Los Angeles-area franchisee, obtained by The Times, says: “SuperShuttle plans to honor all reservations and walk-up requests for service” through Dec. 31.
Attempts to reach Mark Friedman, identified as general manager in the letter’s signature line, were unsuccessful Thursday. SuperShuttle executives could not be reached for official comment. But two SuperShuttle reservations agents reached by telephone confirmed that the company was going out of business, as did a company executive who was not authorized to speak publicly.
SuperShuttle is one of the few services that can still pick up riders curbside at LAX after the airport’s recent changes to help ease congestion. In November, Lyft, Uber and taxis were relegated to a pickup lot next to Terminal 1; travelers can either walk there or wait for an airport shuttle to ferry them.
But shared van services such as SuperShuttle have been hit hard since the advent of ride-hailing services. At LAX, shared van rides plunged by two-thirds in the first half of this year compared with the first half of 2016, the first full year that Uber and Lyft operated there, according to city data. Trips on LAX’s FlyAway buses also sank by two-thirds during that time; taxi trips fell 39%; and courtesy shuttles to car rental facilities, parking lots and hotels saw a 20% decline. The number of Uber and Lyft trips, meanwhile, more than doubled.
The letter to the franchisee cited “a variety of factors” for the company’s closure, “including increasing costs and changes in the competitive and regulatory landscape” that “have called into question the economic and operational viability of the company’s operations.”
The shutdown will leave franchisees in the lurch — hundreds of them in California alone.
“A lot of us own our vans, and now we don’t have jobs,” Mohammad Baraei said Thursday afternoon in between shuttling people to and from LAX, adding that he still owes about half the payments on his $66,000 vehicle. “I can’t even file for unemployment. I don’t know what I’m going to do.”
SuperShuttle is also laying off employees. Customer service representative Ricky Heredia, who is stationed at the airport to help travelers connect with their rides, said he learned about the shutdown shortly before his lunch break Thursday: His manager handed him a letter saying his job would end Dec. 31.
Merih Tuncay, waiting to be picked up at LAX on Thursday, said he has been a loyal SuperShuttle customer for the last five years as he splits his time between his homes in Turkey and Fontana. The 45-year-old said he has enjoyed reserving a ride in advance and knowing the price far ahead of time — benefits that Uber and Lyft don’t provide.
Tuncay said that for rides between LAX and Fontana, he used to rely on a taxi driver he’d befriended — until that driver’s fare rose to $500 for a round trip. SuperShuttle charges him $286, he said. Asked what he’d do without SuperShuttle, Tuncay said: “Maybe I’ll have to start renting a car.”
Other travelers at the airport similarly said they appreciated SuperShuttle’s comparatively low prices and the fact that a large family plus luggage could fit into the van.
But the vans’ high capacity also can mean inconveniently long, winding trips as riders are dropped off one by one. “In honor of the death of SuperShuttle, on your way home tonight make a random stop at 7 different addresses before finally heading home,” Twitter user @jehawks joked.
Signs of the company’s shakiness appeared shortly before the Thanksgiving holidays: In addition to withdrawing from several other airports, SuperShuttle suspended its operations at LAX because of an issue with insurance. The California Public Utilities Commission said the service was out of compliance with state regulations. The issue was resolved Nov. 21.
SuperShuttle is owned by an affiliate of Blackstreet Capital Holdings, a private investment firm in Bethesda, Md., court documents show. Blackstreet describes itself as specializing in acquiring small or midsize companies “that are in out-of-favor industries or are undergoing some form of transition.”
Blackstreet acquired SuperShuttle in September from Transdev on Demand Inc., which is part of the Transdev Group of France, according to a lawsuit Transdev filed against Blackstreet this month in Delaware Chancery Court in a dispute over some terms of the transaction.
Officials at Blackstreet could not immediately be reached for comment on SuperShuttle’s suspended services or on how SuperShuttle’s services are divided between company-owned operators and franchisees.
SuperShuttle’s website shows that the company provided service to more than 80 airports worldwide, including those in Southern California, before it began suspending services in many locations.
The company’s demise comes less than a year after it won a labor victory that made it easier to classify its drivers as independent contractors rather than employees. In January, the National Labor Relations Board ruled against SuperShuttle drivers at Dallas-Fort Worth airport who were looking to unionize.
Times staff writers James F. Peltz and Laura J. Nelson contributed to this report.