Surviving in a Changing Mobility Services World

Today municipalities and corporations demand mobility solutions that incorporate all their transit modes – not just specific manufacturers or specific vehicle types.

“Existing transportation systems are struggling to keep up with current, and future, travel demands owing to rapid urbanization and population growth,” said Simon Dixon, global transportation leader at Deloitte. He explains that there a several ways in which mobility is already evolving to meet demand and they include rapid advances connected, autonomous and electric vehicles.

“What’s more, younger generations are now preferring pay-per-use mobility, in place of owning a car,” he claims.  They are the generation that’s more likely to accept mobility-as-a-service over car ownership as shown by the emergence of car clubs across high population density areas.

Car ownership

Darren Jukes, leader of industry for industrial manufacturing and services at PwC explains: “Through this pay-to-use model, you can use a vehicle for an hour, half a day, or for whatever your needs are. If you look at how much you pay under an outright ownership of a vehicle versus your utilization, you will find these types of car clubs very competitive at a lower cost.”

He argues that car ownership has already moved much more towards this model, which is based on usage just as it is in the world of television and online services. “In the TV world, for example, we’ve moved to subscription services, paying a fixed amount, but getting more content rather than being prescribed what it looks like. The same applies with music, with services such as Spotify, giving you freedom about how and where you use that service.”

The belief is that mobility is evolving beyond car ownership, not just in the consumer markets but also in regard to offering employees fleet cars as an inventive, an asset that’s part of their pay and employment benefits packet.  Company cars were common 10 years ago and procured on a rolling three- to six-year cycle through structured leases but the prediction is that the future fleet is going to look much different. The vehicles won’t be owned because the mobility world is moving towards personal contract plans, which Jukes says are used for the purchase of 95% of new cars in the UK today.

Evolving mindsets

He adds: “The consumers’ mindset is rapidly moving from an ownership model to a pay-to-use model where the cost per month is lower as you’re not buying the car but paying to use the car. Your choice is, therefore, based on your needs and preferences at any given time. For the rest of the mobility vision to evolve there has to be a move from pay-to-own to pay-to-use.”

Iwan Parry, market development lead for new mobility at the Transport and Research Laboratory (TRL) , also reveals that: “TRL are currently working on a number of initiatives across the field of new mobility to develop on-road AV testing facilities, to undertake real world trials of new vehicle and enabling technologies (including automated systems) and to evaluate the costs, benefits and unintended consequences associated with their deployment.

“In many societies commercial, economic and political pressures have also shaped the evolution of mobility with these factors influencing investments in public transport and infrastructure for private vehicles. Today, multiple pressures of transport urban growth, congestion, environmental impact, access to mobility and safety are in the crosshairs of new mobility solutions. They tackle negative impacts while improving access and complementing existing mass transit.”

Parry says all of these solutions are enabled by data, computational resources, communications, cultural shifts “in attitudes to ownership and ultimately the technologies which will separate vehicles from their drivers through increasing automation.” He thinks we are increasingly challenging ourselves to make healthier choices about the ways in which travel and enjoyment will be among the factors that may increasingly influence our choices in the future.

APIs and multi-model platforms

So, with data and an increasing array of mobility choices likely to be available, how can mobility evolve by leveraging open application programmable interfaces (APIs) and multi-automaker mobility platforms? Jukes responds: “There is a version of the future whereby the mobility industry – particularly cars – grows to replicate what you see in the airline industry. In that industry you have Airbus and Boeing. Each airline tailors the aircraft as a platform, so if you get on Airline A, there will be differentiation in terms of look, feel and destinations.

“If you roll forward to an autonomous world in, say ten years, a key focus for mobility providers will be on the look and feel of the interior and what you can do during your journey, with people opting to pay a premium to gain more features or particular comforts and experiences.”

He, therefore, believes that the propensity of mobility providers to allow open APIs will increase.  He explains why: “It is impossible for one person to be the provider of all of the transportation systems and so without open APIs you can’t operate in a truly connected, multi-model connected mobility-as-a-service world. Its foundation demands open APIs, and we have seen companies becoming more comfortable with that type of approach and interaction.”

City-level approach

Parry adds that the best ways to support multi-modal transportation and the rapidly growing demand for last mile e-mobility require a city-level approach: “…to co-ordinate services, including micro-mobility”. He then claims that an electric scooter journey is around 100 times more efficient than an equivalent journey “by a conventionally powered taxi from an energy and air pollution perspective”.

However, there is a need to support micro-mobility as it has the potential “to shift the balance in cities from heavy inefficient vehicles to lighter highly efficient ones” and this requires current legislation to be updated in a measured and staged way “to avoid potentially negative consequences to road risk and micro-mobility user safety”. The aim of the legislation should be to permit the development and innovation to create more efficiency transportation and livability in cities.

Dixon adds: “To improve urban mobility, cities need a platform that promotes efficiencies across the transport network and create behavioral ‘nudges’ across the system.  A mobility operating system, for instance, is an intelligent data platform that combines advances in Internet of Things technologies, such as big data and cognitive analytics to optimize supply and demand across a transport network.

“The system solves mobility and transportation challenges by matching supply with demand, catering to individual preferences and optimizing transport resources.  The system would be operated by the city itself and match different modes of transport such as bikes, public transport and shared cars, to the travelers needs such as whether the person traveling is commuting, visiting the city, or travelling for business. It would offer seamless mobility services on demand in an inclusive manner, enabling services such as unified payment and insurance solutions to run side-by-side.”

Creating partnerships

Jukes says multi-model transportation relies on creating the right partnerships. “For one organization to be able to offer multi-model transport solutions is nigh-on impossible. Each part of the way the system is operated is hugely complex. The partnerships are being enabled through integrated technology platforms, involving a lot of connectivity and sharing and will operate behind the scenes.”

Mapping out these partnerships necessitates answering this question:  what role do you want to satisfy? He reveals that there is neither a wrong nor a right answer: “Different organizations are pursuing different strategies with partnerships enabling them to deliver each part of the ecosystem as required. Autonomous mobility also has some beneficial aspects, providing access to people who might otherwise be excluded.” One strategy may be about a platform for a range of providers or carmakers, which will require you to have partnerships with consumer-facing brands.

Evolve or die?

Parry concludes that there are many disruptive predications for the future of mobility. However, he advises that there is a need to strike a balance against the many factors involved in making decisions. This inevitably depends on the cultural evolution within society.

“Selling your car to use multi-modal mobility-as-a-service is not the same as buying an iPhone and joining the smartphone revolution. The extent to which economic rationality drives people’s choices may be overestimated in many models of mobility service adoption and growth.” So, the future is likely to be disruptive but not all visions of it believe it’s a case of evolve or die.

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