The Disrupters: The Mobility Game Post Pandemic

COVID-19 has presented fresh challenges to shared mobility companies.

Job cuts and a near-total absence of customers for various time periods in many cases, while cities face budget shortfalls along with the silver lining of a welcome break in traffic in many places. Yet, as metropolises and nations are steadily going back to daily routines and reopening economies to varying degrees, some mobility firms are proceeding with their expansion plans.

Renault’s Zity car-sharing service began offering its Zoe models in March just as the city was facing a complete coronavirus shutdown. The service works with the Ridecell platform and during the spring the service transformed from short-term, free-floating rentals into cars that could be borrowed free of charge for front-line healthcare workers.

“Rather than downtown zones for urban customers, (Zity) drew zones around seven metro hospitals and turned those into allowable legitimate parking spaces,” explained Mark Thomas, vice-president alliances and marketing, Ridecell, adding, “We changed the price to zero and authorized it through a mechanism to prove they were hospital workers so no one tried to arbitrage and ride for free.”

That goodwill made the best of a bad situation around launch but Zity, no doubt like most Parisians, is ready to get back to business. Zity CEO Javier Mateos told TU-Automotive the company is ready for relaunch: “After three weeks of service we foresee that the impact won’t be critical and business will be stable at the end of the year.”

Mateos noted that the company’s Madrid operation has made a speedy recovery. “Zity Madrid used to have an average of eight to 10 rentals per car per day, after COVID-19 and during phase two of de-escalation, we’ve already achieved 90% of average rentals.”

There are plenty of concerns predating and certainly post-COVID-19, raising issues around economic issues, a potentially less socially mobile society, and now sharing germs as well as mobility with respect to ride sharing to dockless scooters to car sharing. As a result, and unsurprisingly given the severity of the shutdown, many of these companies have cut jobs and reduced operations. Also, the worst probably is yet to come as evidenced by some US cities and states re-closing parts of their economies to stave off a second surge in the virus.

“The fact of the matter is that most mobility platforms will struggle during this crisis. A decrease in ride demand is expected to last sometime after the coronavirus restrictions are lifted,” Nicolas Inchaustegui, senior consultant for mobility, Frost & Sullivan told TU-Automotive, adding, “Even as all platforms change policy to assuage the fears of riders, many will be hesitant to use shared transit anytime soon. Mobility companies that do not have consistent revenue streams or the funding to endure this hardship are likely to fold or face buyouts.”

Still, Inchaustegui notes that some companies are better positioned to succeed despite the pandemic concerns and adds that all platforms face a heightened need to provide security and peace of mind to allay user worries. He said: “All platforms need to focus on creating positive user experiences that makes them feel safe in the short term.

Mateos remains bullish that his fleet can do just that, reassuring current customers and attracting new ones. “We have adapted our business to the new normal by increasing service areas, reducing fares, implementing longer-term rentals (up to three days) and improving cleaning and the hygiene protocols in the fleet,” he explained.  “These measures have allowed us to maintain the trust of users and they must be part of the strategy of each mobility company that wishes to remain active.”

Thomas sees urban commuters eschewing public transportation and driving demand for car-sharing firms: “Shared vehicles are most often used by people without vehicles. Those people’s alternative is public transit, and recent studies from IBM show that 20% of public transit riders that identified as regular riders said they won’t use it now because of sharing space with other individuals. Another 25% said they’ll use (public transit) less, they are concerned about being in the same space as other people (who may transmit the coronavirus).”

He added, “With car sharing the great thing is you are in the vehicle by yourself. You can bring a wipe and wipe it down yourself for an additional two minutes to clean the environment and then you have no droplets (from strangers) in the air. We think COVID-19 is turning into a renaissance for the car sharing industry, with packages for longer periods of time for people who want to use it Monday through Friday for commuting.”

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