A novel repositioning approach and analysis for dynamic ride-hailing problems

Mobility-on-demand services continue to grow in popularity and could provide a cheap and resource-saving alternative to private vehicles. However, to be truly attractive to the general public, these services must be thoroughly optimized. In this paper, we consider a ride-hailing problem where available vehicles have to be assigned to dynamically arising customer requests and, furthermore, vacant vehicles have to be repositioned to other parts of the service area to balance supply and demand. We propose a novel repositioning strategy based on dynamically created, overlapping zones that addresses identified weaknesses of previous repositioning approaches. While most other ride-hailing studies only consider one specific setting for which a suitable ride-hailing strategy is developed, we further analyze which design decisions in the context of assignment and repositioning work best under different given problem characteristics. Our results show that the proposed repositioning approach outperforms the benchmark approaches in most of the relevant settings, independent of the underlying objective function. Additionally, we show that, especially for low-utilized fleets, the simple nearest-vehicle assignment strategy outperforms matching-based assignment approaches in many settings. The insights gained are analyzed and thoroughly discussed.