“The new mobility services are essential to reduce congestion”

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This article was initially published in Public Transport Trends 2015.

Interview with Fabienne Herlaut on the new mobility services that have emerged in the last decade such as car-sharing or transaction platforms for ride-sharing.

Fabienne Herlaut

Mrs Herlaut advises companies on mobility 2.0 and is member of the strategic committee of Mov’eo, a competitiveness cluster focused on future mobility. She has launched two investment funds for eco-mobility and was head of corporate strategy at SNCF (France). In this interview, she advocates for the integration of the new mobility initiatives in the urban mobility landscape and for the development of a regulatory framework that would benefit users, cities and the different players.

Mrs Herlaut, in your view, what have been the main changes in urban mobility in recent years?

In the last seven years, we have seen new ways of using cars, thanks to smartphones, supported by the emerging trend for a collaborative economy and the involvement of investors. This formerly marginal trend is becoming a deep-rooted trend. All the world’s capital cities now offer bike-sharing services, car-pooling, car sharing services etc. This form of mobility is now becoming common almost everywhere.

What are the success factors for new services in urban mobility?

An operational service is one that offers ease-of-use, which offers competitive prices, meets the needs of customers especially in terms of availability, and is fun. To be successful, the service must innovate and stand out from the crowd on at least one of these criteria. However, the most difficult thing is to ensure that the service can operate in the real world and is highly reliable. For instance, behind the website where I’ve signed up, are there people and vehicles that will truly allow me to get around?

Mass transport is crucial for massive traffic flows, but the new mobility services are very useful for the last mile

What links can you draw between these new services and mass public transport?

Mass transport is crucial for “massive” traffic flows, but the new mobility services are very useful for the last mile and for areas that are less dense. These services are complementary to public transport and do not compete with it. That is because these services help to take the pressure off overloaded public transport at certain times of the day. They also cover areas and trips that are not covered by public transport. Public transport should encourage the emergence and development of these new services, by offering combined services. After all, these new mobility services are essential for reducing congestion and CO2 emissions.

What is the best way to ensure a viable economic model for these new mobility services? Are we likely to see consolidation among the players?

Good operators offer a leading technological platform with a top-class physical service on the ground (cars, parking, and drivers). As time passes, we see that it is getting harder to enter the market, since the cost of customer acquisition and technology are becoming more and more expensive. In 2008-2009, one could launch an initiative with €500,000. In 2012, it took between €2 and 3 million, and today the cost is even higher. So there will surely be consolidation, because these are ‘winner takes all’ markets: BlaBlaCar and Uber dominate their respective markets, and it will be almost impossible for a new comer to catch them up. The challenge for new entrants is to define their positioning at local level and to find a space to grow.
One solution is for these new players to forge a partnership with the large mobility groups, even if that solution means bringing together players with very different working methods and time horizons.
Large groups have the capacity to finance and support the growth of new players and to bring them to profitability. In return, these groups are positioning themselves in new services such as vehicle-sharing, real time and smart parking.

What role can public authorities play in this new urban mobility landscape?

We need to encourage the emergence of new mobility initiatives by facilitating access to data and funding, and by developing regulations in the interest of users, cities and the various different players. It makes no sense to ban Uber. But just how and where that company is established must be determined by looking at insurance issues as well as the professional status of its drivers.

How do you see all of this evolving over the next few years?

The next major advance will be linked to parking, both on and off street. We already have the payment systems to do this. As time passes, it is going to become easier to book empty spaces for parking by day or night: these spaces will be brought back into good use. Moreover, real-time route planning will help to smooth transport flows, by offering alternatives to traffic jams. With this information, people will find tailored solutions and movement around cities will be improved.

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