Navigant Research Blog

Mobility Services Target Driving Less (or at Least More Efficiently)

— September 1, 2016

CarsharingThe problem of urban congestion includes both too many cars simultaneously on the road and too few places to park them. New mobility services from Ford and Lyft are using data analytics and last-mile ridesharing to solve these twin challenges.

Increasing urbanization (82% of people now live in urban areas in North America, according to the United Nations) is intensifying the pressure on city streets and roadways and encouraging more urban dwellers to forego owning a car because of the expense and hassle of finding a place to park. Realizing that vehicle sales to city residents may start to flatten, automakers (including Ford) are diversifying their revenue streams with mobility services.

The recently unveiled FordPass app enables any car owner to pre-book a parking space in garages in more than 160 cities. FordPass also includes phone access to humans to help customers get around in traffic or find other mobility options, and the company also opened its first FordHub mobility storefront in San Francisco. When you also consider the company’s FordPay payment service, it’s clear that the automaker isn’t afraid to borrow from a certain Cupertino company’s playbook. (What’s next, the iFordFone?)

Autonomous Future

Ford also continues to march toward releasing a fully autonomous vehicle. The automaker recently invested in lidar manufacturer Velodyne’s autonomous sensing technology. Ford also announced its intention to produce a fully autonomous car by 2021 for use in ridesharing services. Uber, Lyft, and many other companies see taking those pesky compensation-seeking drivers out of the equation as the future of ridesharing.

Navigant Research forecasts that annual mobility services revenue will reach $4.8 billion in 2020. Automakers will play a significant role in these services, which include carsharing and ridesharing services, congestion charging programs, EV charging services, intelligent traffic management, and smart parking systems.

Smart Urban Mobility End-User Services Revenue by Region, World Markets: 2015-2024

Mobility(Source: Navigant Research)

If an autonomous vehicle is electric, it would reduce urban emissions while also addressing the problem of limited parking. If used to get people to and from mass transit stations, ridesharing programs can reduce the overall vehicle miles traveled by removing trips into the city core. Such is the case in the Denver suburb of Centennial, where light rail customers can request a free Lyft ride if they live near the Dry Creek train station. While using tax dollars to put people in private cars may seem counterintuitive, if it increases the utilization of light rail, it can be viewed as a net positive in solving the last mile challenge and reduce the cost when compared to limited-use bus services. Employees who work for XOJET, which provides luxury rides above the clouds, can also now access Lyft to get to and from their hotels and airports while they are accommodating the jet-setter crowd.

 

Two and Four-Wheel EV Sharing Programs Growing Rapidly

— August 8, 2016

E-BikeConsumers around the world are increasingly searching for new products and services that will enable improved mobility in and around city centers. A key challenge for cities in the 21st century is how larger numbers of people can be incentivized to move away from personal cars for motorized transportation and toward cleaner mobility devices and services.

Shared EV programs reduce vehicle emissions and noise while simultaneously improving mobility in cities—something personal EV ownership cannot achieve on its own. As the EV industry continues to evolve and help address some of these concerns, vendors are experimenting with shared EV programs that utilize an array of vehicle types.

Increasing Interest from Automakers

In early August, BMW announced that it will be expanding its ReachNow carsharing program to cover Portland, Oregon after successfully deploying the service in Seattle, Washington in early 2016. The service attracted more than 13,000 members within its first month of operation. BMW temporarily matched Car2Go’s per-minute prices and eliminated its membership fee for increased competitiveness. The automaker uses a mix of vehicles for the program that includes MINI Coopers and the all-electric BMW i3.

Additionally, Nissan is collaborating with San Francisco-based electric scooter-share company Scoot Networks to deploy a fleet of 10 mobility concept cars (the Renault Twizy) in the Bay Area. Beginning August 2, new market entrant Green Commuter is launching a carshare and vanpool fleet in Los Angeles using entirely all-electric Tesla Model X SUVs.

E-PTWs Continue Broad Implementation

In the electric power two-wheel vehicle (e-PTW) market, Bosch is launching an electric scooter (e-scooter) sharing program in Berlin, Germany. The company is using 200 e-scooters from Taiwanese-based company Gogoro, which implemented a battery swapping network business model for its e-scooter deployment in Taipei. The battery swapping model from Gogoro is being adapted to be more of a traditional carshare model in Germany. E-scooter sharing services are expanding quickly across Europe, with iconic cities such as Paris, France and Barcelona, Spain having already implemented similar programs.

Globally, an increasing number of bicycle sharing programs have also been turning toward electric-powered technology as of late. Most recently, it was announced that the largest electric bicycle (e-bike) share program in North America (roughly 200 e-bikes) will be implemented in Baltimore, Maryland in the fall of 2016.

Whether it’s on two wheels or four, the plethora of new on-demand mobility programs sprouting up across the globe indicates that transportation is moving toward a future that is both shared and electric. Vendors looking to capitalize on this rapidly evolving business will need to offer high levels of vehicle accessibility, affordable hourly usage rates, and differentiating product options. For more information on electric mobility devices and their impact on cities, look out for Navigant Research’s upcoming Electric Mobility in Smart Cities report.

 

How Will Wireless Connectivity, Vehicle Autonomy, and Electrification Converge with On-Demand Mobility?

— June 13, 2016

CarsharingIn the future, urban transportation is expected to be electric, autonomous, and on-demand. This is the vision that captures the major trends in mobility and is one that companies like Uber and Google already appear to be working toward. Navigant Research believes that on-demand shared transportation services—whether carsharing, ride-hailing, bikesharing, or even public transit—will converge with the major vehicle technology trends of electrification, wireless connectivity, and autonomous driving capability to create a low-carbon transportation system for cities over the next 25 years. Navigant Research has covered these trends in its recently published Transportation Outlook: 2025 to 2050 white paper and will discuss them further in a June 14 webinar, Changing Models for Urban Mobility.

Convergence Underway

This convergence is happening already. The first piece, wireless connectivity, is a key building block technology for a future where personal transportation transitions to mobility as a service. By 2025, Navigant Research forecasts that more than 1.2 billion vehicles globally are expected to be connected to their surroundings and/or to each other through either built-in or brought-in communications technology. At a baseline, these systems will provide real-time safety alerts and traffic notifications to drivers; the more mature and full-featured systems will support semi-autonomous driving systems. In this same timeframe, the number of vehicles equipped with some form of telematics will also grow rapidly. By 2025, most new vehicles in developed markets are likely to have telematics offering various types of services to the driver. Today, this type of connectivity is already central to electric vehicles (EVs), which have navigation systems that alert the driver to available charging stations and provide battery charge status updates.

The convergence is also already occurring between vehicle electrification and shared mobility. EVs are an increasingly popular option in carsharing schemes in cities. Indeed, city officials looking to control pollution in congested city centers are actively encouraging the use of EVs in carshare services. For example, officials in London pushed hard to bring to the city an electric carsharing scheme similar to the successful Autolib’ service in Paris; the new service opened in spring 2016. Carsharing services already see a greater percentage of EVs in their fleets than is found in the wider passenger car population. Navigant Research estimated that plug-in hybrids and battery EVs represented more than 15% of all vehicles in carshare services as of 2015. While these EVs are largely concentrated in a handful of services—such as the all-electric Autolib’, all-electric carshare companies in China, and in some of Daimler’s and BMW’s carshare services—EVs are expected to expand to many more carshare operations through 2025 and beyond. One reason for this is that carsharing will be a growing option for automakers to put certain types of cars into service—primarily fuel-efficient, electric-powered, and autonomous—and many OEMs are expected to operate these transportation services themselves as a way to offset reductions in revenue due to falling vehicle sales in urban areas.

Mobility as a Service

Carsharing is a key building block for the future of mobility as a service, and is now a well-established industry that feels familiar rather than new. But in fact, this business is at the early stages of major upheaval that will change the role it plays in urban mobility. First off, automakers are entering the market in earnest, and it is expected that almost all major automakers will be offering some type of shared vehicle service by 2025. A second disruptor is the rise of the one-way operational model. With drivers no longer required to return vehicles to the same parking spot where they picked it up, carsharing significantly expands its use case for city residents. Carsharing now can provide true on-demand mobility and be used for spur-of-the-moment travel needs and for shorter one-way trips than is typical for conventional round-trip carsharing. This new operational model makes carsharing more like the third major disruptor in the shared vehicle sector: the explosive popularity of ride-hailing apps like Uber and Lyft. While these two types of services can be seen as competing, they are better thought of as complementary, each offering a different type of experience for the customer. Carsharing acts as a replacement for owning a car, whereas ride-hailing is more directly a replacement for conventional taxi services. One-way carsharing and ride-hailing services may well compete for customers, but Navigant Research believes that the urban mobility model of the future will have both carsharing and ride-hailing.

Autonomous Opportunity

Both services probably will be early markets for autonomous driving technology, the final piece of this low-carbon mobility as a service model. It is likely that autonomous vehicles will initially be integrated into shared fleets in a controlled and regulated setting. Sites like central London, Paris, and Singapore are anticipated to be among the first. From 2025 on, a number of entities—including carsharing companies, taxi fleets, ride-hailing companies, and automakers—are expected to be operating autonomous fleets. In particular, automakers likely will embrace the autonomous fleet idea as an extension of their current involvement in carsharing schemes and will seek to incorporate them into their EV models. GM has announced it will begin offering autonomous Chevrolet Volts for its employees to drive at its Technical Center in Warren, Michigan in late 2016.

According to the United Nations, by 2050, as much as 66% of the world’s population is expected to live in urban areas, and the individually owned vehicle will probably become a rarity in most large cities. The possibility that shared mobility may lead to less use of public transit has been an oft-cited concern among city officials and sustainable transportation advocates. A 2016 report by the Shared-Use Mobility Center found that services like carsharing and ride-hailing are actually complementary to public transit. The report, which focused on users in seven U.S. cities, noted that the people that use shared modes of transportation the most were the most likely to use public transit and to own fewer cars. Navigant Research also believes that, from 2025 onward, public transportation itself will become more of an on-demand service, which will use buses much more efficiently. Connectivity and data analysis will enable the efficient dispatch of vehicles to where passengers need them, keeping idle time to a minimum. These services can be fully integrated with the other types of on-demand options in the city, making multi-modal travel more robust and seamless.

 

Fuel Cell Vehicles Join the Carsharing World

— May 19, 2016

CarsharingGerman hydrogen company Linde is experimenting with a solution to the infrastructure problem for fuel cell cars. This summer, the company will launch an all-fuel cell vehicle (FCV) carsharing service in Munich. For this trial program, Linde is partnering with Hyundai to provide the fleet of FCVs. The service, called BeeZero, will have 50 fuel cell-powered ix35 crossover SUVs (known as the Tucson in North America), Hyundai’s current entry into the fuel cell market and one of only two FCVs commercially available today.

Linde is in good company in offering a carsharing service with zero tailpipe emissions, as a number of carshare programs around the world specialize in battery electric vehicle (BEV) fleets. In its 2015 Carsharing Programs report, Navigant Research estimated that around 20% of all carsharing vehicles in use globally were plug-in electric vehicles (PEVs)—mostly pure BEVs. Most of these EVs are in a handful of programs where the EV is a part of the service’s brand identity. The most famous is probably Autolib’ in Paris, run by Bollore. The Kandi carshare service in China also uses a fleet of micro EVs. Both Daimler and BMW’s carsharing services have deployed the automakers’ EVs, but not exclusively. Daimler recently switched out all EVs for gas cars in its San Diego carsharing service; the reason given was a lack of charging stations. (It will be interesting to see if the cars are reinstated once utility San Diego Gas & Electric launches its EV charging pilot program.)

The Challenge of Charging

Charging is one of the challenges for battery-powered carsharing vehicles, and likely explains at least in part why few carsharing companies integrate BEVs into their larger fleet of gas cars. Even if chargers are available, there can be problems with ensuring they are properly plugged in and that the charge stays full.

FCVs operating in fixed areas have the advantage of requiring a relatively small number of strategically located refueling stations in a city while offering longer ranges than EVs. Navigant Research predicted the introduction of fuel cell carsharing services for this reason in our recent white paper on the future of transportation. This makes an easier pathway to market for FCVs than having to build a network of refueling stations to service private car ownership.

Longer Ranges

Linde is also promoting the advantages of the longer driving ranges offered by FCVs. The Hyundai ix35 has a range of over 350 miles on a tank of hydrogen. While this is indeed a key benefit of fuel cell cars, it will be useful to see how much of a benefit this is for a carshare user. Carsharing services have a few typical use cases: short inner-city trips (the kind being served by one-way carsharing operations); planned trips with slightly longer range needs; and long-distance trips, typically on weekends. The BeeZero service would presumably be used for the latter two cases, but long-distance travel might require use of a hydrogen fueling station at the destination.

Linde has said it will use BeeZero to gather information on “day-to-day fleet operations” of fuel cells and hydrogen that can be fed back into its hydrogen development efforts. BeeZero presumably also offers Hyundai not only with an avenue to deploy more of its fleet of fuel cell ix35s, which have seen limited uptake to date, but also a chance to take lessons learned into its FCV development efforts. In the long-term, it is possible to envision FCVs being deployed in carshare services sponsored by automakers and infrastructure providers in cities where only low carbon or even zero emission vehicles are permitted.

 

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