Preparing for the Mobility Revolution

The Blurring Line between new Mobility Services and Public Transit
April 2017

The development of alternative mobility solutions, in particular ride-sharing, ride-hailing and car-sharing, continues to deeply transform the urban transportation landscape, well beyond simply taxi operators. The forthcoming emergence of driverless vehicles will further rattle the status quo. Yet, the deployment of such solutions will likely be quite different depending on the region, as outlined below. In most cases, the line between new mobility solutions — mostly private — and public transit will become blurry. What do we observe today? What can we expect for tomorrow?

 

Public transit is of a very different nature depending on whether you live in European, American or Chinese cities. European urbanites enjoy dense networks of metros, tramways and buses which are safe and clean for the most part, and used by people of all social origins. By contrast, Americans cities suffer from limited investment in public transportation over the past decades, as individual cars have been the dominant force. The few metro and city bus lines are by and large antiquated and used by poor people. China offers a different situation; the huge growth in urban population has forced cities to make massive investment in metro lines over the past 15 years. Yet, traffic congestion and air quality remain major issues, which drives a massive push for electric vehicles.

 

City governments, regardless of location, create policies aimed at improving their constituents’ quality of life, today and tomorrow. Practical objectives include ease of movement for all, air quality and safety. To this end, public transit agencies are progressively embracing solutions that increase network capillarity (e.g. new routes with smaller vehicles) and reduce traffic congestion (e.g. pooling), all the while taking care not to destroy their economic model.

 

In the U.S., where public transit is scarce, there is much space for private operators to offer new mobility services. The necessity for new solutions is fueled by the decline in the percentage of young people who obtain a driver’s license (also a trend in in Europe). Uber and Lyft provide user-friendly, cheaper alternatives to taxis. Pooling services reduce ride cost further and limit congestion for everyone’s benefit. Competing issues can arise when new solutions duplicate public transit services, funneling passengers from the latter and therefore jeopardizing the transit agencies’ fragile economic balance. After Uber, Lyft is currently testing such a service in San Francisco: “Lyft Shuttle” operates on fixed routes with preset stops, using privately owned vehicles. Similarly, Ford is testing Chariot, a startup it acquired in 2016 which operates company-owned passenger vans on fixed routes. Such new services must be properly coordinated with transit agencies with the objective to maximize short and long term benefits for all citizens. The solution will eventually be based on services that are complementary in space and operating time. The public and private lines will blur.

 

In Europe, shared bikes and electric cars have already become integral parts of the transit landscape. Recently arrived ride-hailing solutions are disrupting taxi operations and are often rejected by city governments…for now. However, their emergence has indirectly benefited customers with a clear improvement in taxi service quality. Transit authorities are now testing autonomous shuttles as a way to increase network capillarity — and probably reduce operating costs. RATP, Paris’ transit agency, is testing such shuttles made by France-based EasyMile and Navya. This takes place in the city center where regular buses may offer too much capacity or are  too large size. Similar experiments are taking place in Switzerland where public transit is excellent, as well as in several other countries (including the U.S.). It is interesting to note that investors in EasyMile and Navya respectively include Alstom (a global leader in metros, tramways and trains) and Keolis (a private operator that transports 3 billion passengers annually). The lines are blurring.

 

Carmakers, both in Europe and the U.S., are accelerating a shift from making cars to providing mobility. Daimler and Ford were the early movers back in the late 2000s. Most competitors are now following, including Volkswagen which has announced that its first mobility offering will be an electric shuttle operating between scheduled buses and ride-hailing services.

 

In order to complete the future urban mobility landscape, one should add bikes as well as electric two- and four-wheelers offered as a shared service, further increasing network capillarity. All theses modes of transportation will have to operate seamlessly to provide a truly user-friendly experience. Startups like Moovit and Swiftly offer platforms that bring together various modes in order for travelers to combine them in the most effective way. Ultimately, city governments will have to strike the right balance between public and private mobility solutions to reach their goals and provide ease of movement for all, as well as clean air and safety for their constituents.

Marc Amblard

Also published on LinkedIn (https://goo.gl/VFlCZd)

Photo credit: Urban Hub

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