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COVID-19: Boost & break for the development of mobility services

Will the risk of infection become the final stab in the back for shared mobility and thus the end of innovative mobility services? As mobility enthusiasts, we answered this question intuitively with a clear “no”. However, buses and trains are almost empty, kick scooters stand still as if they impersonate the virus, and cities worldwide face a huge increase in congestions because people prefer their driving alone instead of using public transport (“car-mageddon"). In order to differentiate our intuitive answer, we discussed the question of the future of mobility post-COVID with 25 international experts and derived five theses on mobility after COVID 19.

The mobility crisis - a screeching halt for mobility?

As of April, most mobility services are in crisis mode. Until a vaccine is available and the pandemic is dealt with sustainably, only a slight recovery is to be expected. Overall daily life and leisure travel activity post-COVID will probably increase again - but will no longer reach the original growth path.

The corona crisis has led to a surge in digitization and taught us that both remote meetings and home offices are more practical than expected. Therefore, even after the crisis, we assume that these concepts will continue to be used across the board, at a significantly higher level than before the crisis. For many of us, trips to the workplace and similar trips will not rise to the previous level even after the crisis and will lead to a lower travel volume. This mainly affects providers of mobility in cities and, of course, primarily public transport. In addition, it will take time for hygienic solutions to be found in shared mobility and for trust in a safe journey to return completely. The global travel volume grows as long as the world population grows - this was also the case in previous crises. The difference this time: we have learned how to sustainably replace everyday mobility - the correlation will be lower.

The accelerated consolidation phase

Even before the crisis, it was obvious that many of the innovative mobility providers founded in recent years were not working profitably enough to survive on the market in the long term.

OEMs are therefore shifting their focus back to their core business and are taking a more critical look at their mobility offerings. ShareNow has withdrawn from the American market, and Bosch discontinued the scooter service Coup. OEM-independent providers are also affected – scooter provider Circ has been taken over by the competition. In the current situation, these developments are increasing. Providers are also responding to the crisis with price cuts, free minutes, and new services to keep customers or lead them back to their services. Now it is not just a matter of finding hygienic solutions for securing infection-free journeys (e.g. minimum distances, disinfection lamps, etc.), but above all making the business models and operations fit for the recovery. Some overdue pivots now lead to more sustainable solutions: In New York, this is visible in the area of micro-mobility. Many delivery services for meals, food, and medical products use these offers to make important goods available to the population. The crisis is changing customer requirements - those who can quickly adapt will achieve a stronger market position in the long term.

Boost for flexible ownership models

The corona crisis will put many companies and individuals in a financially weaker position. And liquidity will also be an issue during the recovery phase. And yet: most of us already have the desire to be mobile again, or at the latest after the crisis - much earlier than the option of  buying a car might allow. Mobility providers and OEMs therefore have the great opportunity to win customers who are ready to pay again but shy away from long-term commitments and large purchases with flexible and individual vehicle and mobility offers. On the one hand, these are offers with time flexibility, such as leasing models with a variable or shorter term, without a commitment for several years, or subscription models that can be terminated at short notice. Vehicle rentals can also score points - here the contract term is only a few hours or days. Offers are also required that keep capital commitment as low as possible and therefore optimize cash flow. For example the elimination of the down payment in the leasing contract or a flexible installment are possible solutions. Corona will therefore accelerate the adoption of existing business models and further strengthen the already existing trend towards more flexible, individual ownership models.

The data emancipation

In a global comparison, Germany certainly has a conservative attitude towards data protection. The high number of downloads of the voluntary tracking apps for tracking those infected with Corona shows that many users now rate the benefits of data sharing positively and that these are no longer isolated cases. More shared mobility data enables more and better data-based services. This data is currently used, for example, to simulate the effects of various contact restrictions. In the future, connections for the competitive "last mile" will be analyzed and optimized in more detail. Individual travel routes could be completely covered by a mobility provider by integrating additional door-to-door modal forms. Thanks to data emancipation, users will experience services that significantly outperform mobility services "before Corona", such as more efficient, climate-friendly routes. Dynamic price models that are based on precisely predictable mobility demand increase profitability and thus create space for new business models.

Accelerated digitization of public transport

Distance rules and hygiene requirements pose challenges for public transport that will shape the transport sector even beyond the pandemic. A more hygiene-conscious society has higher demands on cleanliness and crowds that operators must adjust to.

Because crowded bus and train lines are being avoided, the interaction of all modal forms is more important than ever. Networking of public transport with car sharing and on-demand providers is moving back into focus. Already today, certain digital tickets can be used to combine bus trips with other mobility services. The corona crisis will, however, reinforce this trend and lead to networked public transport sooner than expected.

The requirements for hygiene in local transport will also accelerate existing trends. This makes cashless and contactless payment of tickets in public transport indispensable to minimize contact. This speeds up the path to innovative smart ticketing models. With apps that automatically or manually record when the passenger gets on and off the bus, driver contact is completely avoided - without installing new hardware.

Fedai, A. / Paetzel, F. / Römer, S.