Insights for Sep-24

1. The Mobility Landscape: Shifting Attitudes to Travel?

Take a deep dive into the detailed analysis from our 8th annual Global Mobility Study, hear from our thought leaders and learn more about the 2050 vision for urban mobility – all in one place.

We examine the changing travel and mobility perspectives that have been impacted by global trends, including:

• Tech advancements: Innovations like electric vehicles and shared mobility are changing transportation use.???

• Environmental concerns: Increased awareness of climate change drives demand for sustainable travel options.???

• Urbanisation and infrastructure: Cities must adapt to new mobility forms amidst rising population densities.???

• Consumer preferences: Shifts towards convenience and personalisation characterise modern travel choices.???

• Economic factors: Economic conditions, such as fuel prices and incentives, significantly influence travel behaviour.???

Find more here: The Future of Mobility?

Connect with Becrom Basu

2. The Impact of Punitive Tariffs on the European Automotive Market

With the EU planning to announce tariffs on Chinese-made cars and uncertainty as to whether the UK will follow, the impact of this on European OEMs, dealers and our energy transition journey remains to be seen.?

When it comes to tariffs on Chinese-made cars, it’s important to avoid viewing this as a ‘them’ vs ‘us’ issue. Alongside exports of European-produced vehicles to China which may now experience retaliatory tariffs, many European or US brands manufacture cars in China that are destined for European markets. These will also be impacted by tariffs (although they are proposed at different levels for different manufacturers). This includes those with Chinese ownership like Geely-owned Volvo, Polestar, Lotus or Smart, but also Tesla and certain models from stalwart European brands like BMW and Citro?n.?

For dealers, Chinese OEMs like BYD, MG, and Chery-owned Omoda and Jaecoo (which has signed up nearly 100 dealers this year) present a potential for rapid sales growth with cars at an attractive price point in a soft new car market. ?

Even with tariffs, Chinese OEMs will have compelling propositions to European drivers. There is likely room for Chinese OEMs to absorb some of the tariffs and remain very price competitive. The prices Chinese OEMs are selling their cars for in China are well below that of Europe; as an illustration, the entry-level BYD Dolphin in the UK has a starting price of ￡25k ($32k), whereas the same model in China starts at less than $14k. Although there are additional distribution costs of selling in the European market, this price differential suggests potential for Chinese OEMs to absorb a large part of the tariffs placed on them and still be competitive. ?

Low prices, combined with lower consumer loyalty to specific brands when transitioning to EVs, means that Chinese OEMs will gain share, tariffs or not. ??

The impact on net zero goals?

The UK and the EU's aim to end sales of new ICE vehicles by 2035 already looks ambitious. EV uptake has stalled, with the share of new vehicles that are battery electric flatlining or falling in many European countries.???

One of the key barriers to adoption is the cost of new EVs. Our annual survey at the start of 2024 found that this remains the top concern for European consumers with regards to buying or leasing an EV. The placement of tariffs on the potentially large volume of lower-cost Chinese EVs will undoubtedly delay the transition.??

Ultimately, tariffs on Chinese-produced cars will only prolong the problem. Whilst their production may have benefitted from below-market-value battery supplies, advantageous land use and tax reductions, the cost advantage still appears to be material, and European OEMs need to invest in efficient production to close the enormous gap in production costs.??

For a further discussion, connect with Will Chamberlain

3. What are the Key Trends Shaping the Future of Mobility?

In today’s capital-constrained environment, it's crucial to rethink how we invest in transport and mobility. Leveraging technology is essential to ensure long-term sustainability and success.??

In this two-part video series, L.E.K.’s Australian partner, Natasha Santha, explores five key trends that are set to impact the future of mobility and the ‘no-regret’ steps we can take today to prepare for tomorrow.

Watch now

Connect with Natasha Santha

4. Fleet and Mobility Live 2024 – 8-9 October 2024, NEC, Birmingham??

Heading to Fleet & Mobility Live???

L.E.K. Partner and Disruptive Analytics Lead, Stuart Robertson, will be speaking at a panel session: ‘How AI & ChatGPT Can Revolutionise Fleet Management and Travel and Boost Your Productivity and Efficiency’.?

The session will cover the many potential benefits of artificial intelligence to fleets.??

Find out more about the event here.??

Connect with Stuart Robertson

L.E.K. Transport & Logistics Senior Team

Connect with our thought leaders

Becrom Basu Andrew Allum William Tite Stuart Robertson

John Goddard Jonathan Simmons Will Chamberlain Chiraag Dattani

The L.E.K. transport and logistics team helps?corporates, investors, shareholders, and leaders?develop fact-based, practical, winning strategies?to navigate today’s mobility and logistics landscape. ?

Find out more??