Mobility Ownership Models Are Changing. How?
Changing habits and technology are enabling us to rethink how mobility solutions are sold, used and owned. And there are many options emerging. The private car is not obsolete, but the future of mobility will involve much more besides. Total expected market value estimates vary. A few estimators like IHS Markit think it can reach $400bn in revenues by 2030. KPMG estimates it at $1trn. Accenture calculates that revenues from mobility will hit $6.6trn by 2050.
COVID-19 has given the car an unexpected boost, as global citizens fear the infection risks associated with public transport. On another note, the appetite for cars in China, the biggest market, remains strong. In the first three months of the year Chinese car sales rebounded close to their pre-pandemic peak.
But car ownership models for people living in city centers are more complex. New modes of transport are emerging and there is increasing competition from upstart mobility providers that connect customers with a variety of different services. Didi, Uber, Lyft and others provide rides on demand. Companies like Zipcar enable people to rent cars by the hour, or even minute. Turo, a Californian firm, is one of several to provide longer-term peer-to-peer car-sharing. BlaBlaCar, a French company that has signed up 90m drivers in 22 countries, connects drivers with spare seats to travelers heading in the same direction. And bike-sharing schemes, electric scooters for hire, flying taxis, all have earned multibillion USD valuations.
All these modes of transport are being stitched together into seamless trips by specialist journey-planning apps. These apps enable commuters to take an eBike to the underground station, take the metro, then jump in on a shared platform for the last kilometer—or pick whatever other combination of price and travel time is most suitable, but for all convenient. Apps which will make the best combination are called aggregator apps. Some say that aggregator apps will generate revenues of $35bn within a decade.
Why is this interesting?
As the relationship between car brands and customers gets more continuous, replacing some one-off sales, it is becoming super direct. The trend has been accelerated by the pandemic, which has pushed more car buyers away from retailers and onto the internet (to stay). Selling vehicles directly forges a bond with buyers, which will only be stronger in the future.
At ADK Insights, we continue to monitor emerging mobility trends and translate their impact on consumer behaviours, providing insights to help businesses future-proof their innovation.