I don't think that's true. I think if you expand the capacity of the subway more people will use it.In order for people to take transit it would have to be so frequent and plentiful there would never be more than a few people per vehicle.
Your argument applies more to remote areas away from subway lines that are serviced by busses or streetcars. There are solutions to that problem that, for whatever reason, the city refuses to contemplate (like jitney services).