Navigant Research Blog

Do Shared Vehicles Need Standard User Interfaces?

— May 14, 2015

Personal mobility is in the early stages of the most significant transformation since the birth of the Ford Model T more than a century ago. A shift from personal ownership to shared use of vehicles is expected to accelerate as an important means of enabling mobility while alleviating the negative aspects our transportation ecosystem. Navigant Research’s report, Alternative Revenue Streams for Automakers, projects that there were will be more than 26 million members of carsharing services by 2023. Automakers recognize the threat this change represents to their business model, and they are scrambling to adapt, but what about the drivers constantly exposed to changing user interfaces every time they use a different vehicle?

As thousands of engineers from across the globe gathered in Detroit recently for the SAE 2015 World Congress, one of the more surprising topics of discussion was whether vehicles should adopt a common human-machine interface. While politicians like to point at the rise of cellphone use in vehicles as a cause of driver distraction, more fundamental design issues can be just as problematic. As more functionality comes to vehicles, controls are needed. Anyone using a new vehicle for the first time is likely to be overwhelmed trying to figure out basic functions like climate control. Manufacturer’s desire to differentiate their products just makes things worse.

Taking Action against Distraction

When Apple introduced the iPad in January 2010, late-CEO Steve Jobs said that anyone that knew how to use an iPhone already knew how to use an iPad. A big part of Apple’s success over the years has been the consistency of its user interfaces. They evolve over time, but they stay consistent enough that users can migrate from one product to another. The same cannot be said for most automobile features, which often vary widely within an individual brand’s lineup.

David Acton, managing principal of P3 North America, suggested at the congress that all vehicles should have a common user interface to help avoid the distraction. This may actually be a step too far considering the technologies available now and in the near future. For example, the Tesla Model S already features a 17-inch touch screen display in the center console for the various controls and displays with another reconfigurable display screen in the traditional instrument location ahead of the driver. As a virtual control interface, these displays can be reprogrammed to suit a driver’s needs.

Google’s Chrome browser and ChromeOS automatically save a user’s settings to the cloud, reloading bookmarks and extensions whenever that user logs in from any computer. Logging out can delete those settings from the machine. If every manufacturer were to include reconfigurable control and display surfaces in their vehicles, a driver could set preferences and then immediately save them either to a cloud account or locally on a phone they connect to the vehicle. From then on, every time they get behind the wheel of a new vehicle, they could connect their phone or log in to instantly retrieve their preferred control layout. Preferences could even include physical settings like the seat and mirror positions.

Best of all, these virtual control surfaces could be integrated into surroundings that still leave flexibility for designers to differentiate their products. The combination of virtual controls and connectivity could enable a blend of personalization and familiarity that reduces complexity for drivers as we make the transition toward a more shared transportation ecosystem that reduces urban congestion and energy use.

 

Helsinki’s Plan to Make Private Cars Obsolete

— August 12, 2014

Helsinki, Finland, has proposed a strikingly ambitious mobility on demand system that presents the logical extension of current innovations in passenger travel.  The city plans to create a subscriber service that would let users choose from, and pay for, a range of transportation options through their smartphones.  The options will include conventional public transit, carsharing, bikesharing, ferries, and an on-demand minibus service that the city’s transit authority launched in 2013.

The major innovation that makes this work will be an integrated payment system.  This part of the scheme may prove the most complicated to implement, but it is the final piece of the puzzle that makes this scheme truly transformative.  No longer forced to choose between the on-demand capability of private car ownership versus the eco-friendliness of shared transit, Helsinki residents will be able to easily get where they want to go, when they want to get there, without needing a car.

I’ve been using the phrase mobility as a service for this phenomenon, but it looks like the mobile phone companies may have claimed that moniker already.  Whatever the name, the concept is the transportation version of other businesses that are moving from selling a product to selling the service or utility the consumer wants from that product.  Planned obsolescence no longer makes good business sense, and consumers can benefit from constant improvements in technology.  This is most common in information technology (in cloud computing and storage, for instance), but it’s also happening in the energy sector – especially for clean technologies like solar, where leasing programs offer a way to overcome the upfront price premium barrier.

Share, Don’t Buy

Globally, carsharing membership has grown around 28% since 2010, with Europe as the leader in this sector.  Navigant Research’s report, Carsharing Programs, forecasts that global carsharing members will surpass 12 million in 2020.  The rise of on-demand ride services, such as Uber, Lyft, and Sidecar, are also transforming the way city dwellers use taxi services.  Taking on the highly regulated taxi business, these companies face considerable opposition, but at this point, it will be hard to put the genie back into the bottle. Bikesharing and even scooter share services are also spreading.  Today’s young urban dwellers expect to be able to use an array of transportation options to suit an array of needs, at the touch of an app.

Helsinki’s program has the potential to tie into other transportation innovations, such as the rise of electric vehicles (EVs) – more carsharing programs are deploying EVs as a selling point for their service – and autonomous vehicle technology.  Wireless charging would also support schemes like Helsinki’s by ensuring that shared EVs are recharging when parked, rather than relying on the driver to remember to plug in.

Faced with dwindling demand in mature markets like North America and Western Europe, automakers are exploring a range of new services to offset lower demand and to gain a competitive edge.  Farsighted companies will look to begin selling mobility as well as vehicles, changing transportation as much as the IT and energy sectors have changed.

 

Brickyard City Hosts Carsharing Experiment

— June 10, 2014

Indianapolis, Indiana, is set to become the site of one of the biggest electric vehicle (EV) carsharing programs in the United States.  The Bolloré Group kicked off the “BlueIndy” carshare program, the company’s first in the United States, in May.  The Bolloré Group is large French conglomerate that, among other things, produces electrical components for capacitors and lithium polymer batteries.

Indianapolis is an odd choice for an EV carshare service location compared to a city like Paris, where Bolloré’s Autolib one-way EV service has been a huge success since its launch in December 2011.  Autolib was one of the first carshare programs to combine EV technology with the one-way carshare model, which allows users to drop cars off at any of the service’s designated parking spots.  The Autolib program has expanded beyond Paris and now has around 140,000 users across France.  According to Hervé Muller, the president of BlueIndy and vice president of Bolloré subsidiary IER, the cars in the Paris Autolib program are used an average of 7 times per day and the program is set to become profitable just 3 years after its launch. The company is now targeting the United States.

Charge Here

So why Indianapolis?   The city has limited public transportation, and its downtown, although quite suitable for hosting the Super Bowl, lacks the concentration of residential living that successful carsharing cities like Paris, Boston, and San Francisco have.  What it does have, though, is a mayor who made the carshare program one of his major priorities and an electric utility that stepped in to pay for charging equipment.

Setting up a public charging network fulfilled a key goal for Indianapolis Mayor Greg Ballard.  Indeed, this program demonstrates a creative way for a city to rapidly establish a charging network.  Bolloré will let other EV drivers use the stations, thus adding an additional revenue stream.

Bolloré has committed to bringing 500 Bluecar EVs and 1,000 public charging stations to Indianapolis. This represents a $35 million commitment from the company.  Indianapolis Power & Light (IPL) has also partnered to support the charging deployment, although there is some question about whether IPL can secure a rate hike to pay for it.  In my conversation with him, Muller said Bolloré expects the BlueIndy service could take up to 6 years to reach profitability and noted that the company is taking a long-term view of developing its U.S. carshare business.

Students and Tourists

It will be instructive to track how this service is used.  Typically, public transportation can be a key ingredient for successful carsharing services, because it allows city residents to get around easily, with the carshare filling in the transit gaps.  In Indianapolis, BlueIndy may essentially take the place of a widespread public transit network.  This is an advantage of the one-way model, with cars being easily used for short trips across town, for example.

The Bolloré Group is also looking to draw membership from the city’s large student population, travelers using the Indianapolis airport, and local businesses that could use the carshare program in place of fleet vehicles.  It’s an ambitious plan. Bolloré has yet to deliver its first U.S.-approved EVs and the program could take several years to reach viability. But if it works, the Indy experiment could serve as a model for other similar U.S. cities.

 

Automakers Look to Stay Relevant in Rapidly Changing Mobility Landscape

— April 15, 2014

How fast is the urban mobility landscape changing?  Last year, when Navigant Research published its Carsharing Programs report, San Francisco, California-based rideshare company Lyft operated in around four U.S. cities and touted 30,000 members.  A year later, Lyft operates in 30 U.S. cities and, in April, the company raised $250 million in a Series D investment round.  Lyft immediately began making moves to secure greater market share by lowering its prices in all cities by up to 20%.  Meanwhile, Uber, the U.S. leader in app-based car services, continues to add new UberX service locations, including one in Singapore, after raising $258 million in funding in August 2013.

Granted, Uber and Lyft are not carsharing companies exactly.  They are mainly alternatives to taxi or livery services.  But they do share DNA with carsharing.  These companies operate somewhat like peer-to-peer (P2P) carsharing services, such as Relay Rides, which also serve as a way for non-professional drivers and those in need of a car to connect, as well as to maximize the utility of someone’s underutilized car.  And, P2P car services could compete with one-way carsharing, a business model that has taken off in the past few years thanks to companies like Autolib’, car2go, and DriveNow.  These services are all part of the new collaborative economy, which depends on a radically new attitude toward car ownership and the ubiquity of smart devices, apps, and software that makes the collaboration as seamless as possible.

Changing Times

The dramatic growth of P2P car services is just one example of how dramatically the transportation landscape is changing, with a clear shift away from the privately owned car as a primary transportation mode.  Yes, this change is still largely concentrated in major urban areas and in developed countries.  Meanwhile, rising car markets (like China) continue to show increases in sales to first-time car buyers, even as the pace of auto sales growth has slowed somewhat.  Still, in a world that is becoming increasingly urbanized, and with the rise of megacities (cities with populations of 10 million or more), this mobility transformation is going to spread.  In the world’s large cities, automakers will find their businesses increasingly squeezed by a range of other transportation options, including the P2P car services and carsharing.

How much of a threat will these options be to car companies?  Carsharing will cut into car sales to some degree, but based on Navigant Research’s forecasts, vehicle sales reductions directly related to carsharing will be tiny compared to the total passenger car market, which globally reached around 82 million in 2013.  But the broader transformation of urban mobility will have an impact on auto sales, as the many options for personal mobility make it easy to forgo buying a car during the time that fuel costs will be rising, along with the indirect costs of driving such as parking and traffic congestion.

This helps explain automakers’ interest in offering carsharing, which has the potential to provide substantial revenue.  BMW and Daimler in particular each came roaring into this market in the last 18 months, capturing significant market share in the European cities where they operate.  Daimler reports having 600,000 members in its car2go service, while BMW reports 215,000 members in DriveNow.  In the Navigant Research report Alternative Revenue Streams for Automakers, revenue from original equipment manufacturer (OEM)-owned carsharing services is forecast to be in the billions as overall demand for collaborative car ownership grows and more OEMs enter this market.  Carsharing represents a prime opportunity for automakers to ensure they play a central role in the changing mobility landscape.

 

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