This paper explores a futuristic transit design concept enabled by modular autonomous vehicles (MAVs).   The goal is to explore the potential of jointly designing regular fixed-route transit service and paratransit.  The project was funded by CCAT, a US DOT Regional University Transportation Center headquartered at University of Michigan.  The leading author, Xiaoyu Yan, presented an earlier version of the paper at 2025 Transportation Research Board Annual meeting.   For preprint, please check SSRN.  The abstract follows.

Abstract  This study envisions a jointly designed transit system comprised of a fixed-route (FR) service and a paratransit (PT) service. The integration of the two services is inspired by the potential application of modular autonomous vehicles, or pods, in transit. Constrained by a fixed budget, the operator of the joint system aims to minimize the total user cost by optimally allocating pods between the two services. To formulate the operator’s design problem, we propose a stylized model, in which the FR service features a simple 2D grid route structure overlaying on a square city, and the PT service is designed as a general on-demand system that can be configured in different modes of operations. A case study is conducted using transit data from the Chicago region. We find that joint design helps prevent resource misallocation that could render a service dysfunctional under insufficient budgets, although its potential to reduce total user cost is limited. Enforcing the equal-access constraint—requiring that PT users incur no greater cost than FR users—tends to help PT users at the expense of FR users, though the overall impact on total user cost is insignificant. Modularity enables the formation of pod trains using small pods, which benefits FR operations, particularly when the design is not tightly constrained by budget. In contrast, automation delivers greater service improvements for PT users, whose more labor-intensive cost structure makes them more sensitive to efficiency gains, especially under tight budgets. Among the PT service modes, ridesharing is the most flexible, allowing for a wide range of service levels based on the available budget.