Are We Asking Too Much of MaaS?

These days it seems as if attending mobility events is more popular than mobility itself. Every week brings news of a mobility service provider retrenching, exiting a market, resetting its strategy, or seeking new investors - while every month brings news of a new mobility-centric event.

The latest mobility development came in the late summer of this year as autonomous shuttle maker Navya’s new CEO noted headwinds from the slower than anticipated development of autonomous vehicle tech resulting in a shift in strategy. “We have decided to adapt our business model: thus, we will now provide our technology to industrials who (sic) want to make their vehicles autonomous,” said CEO Etienne Hermite.

Hermite blamed the lack of a regulatory framework and still-evolving business models for the shift at Navya. Industry observers saw the announcement as jeopardizing the North American prospects for Navya’s newly-minted plant in Saline, Mich. After all, if Navya is going to focus on developing autonomy for others’ vehicles – that would mean it is no longer focused on making and outfitting its own.

This, in a nutshell, is the challenge facing all mobility operators – from shuttles to scooters to “ubers.” How to scale. How to make money.

I moderated a panel discussion at CoMotionLA this fall (an event that was renamed to foster a brand extension to CoMotionMiami ad infinitum) and led a conversation coordinated by mobility operator Bestmile to get at the core issues animating mobility.

Four visions of mobility emerged from the discussion. A Bestmile executive shared ride hail operator Alto’s vision of ride hailing built around full time drivers driving company-owned cars. A Beep executive described the sort of increasingly familiar low-speed, fixed-route autonomous vehicle operation associated with college or company campuses and retirement villages. (Beep, in partnership with Navya and Bestmile launched the first autonomous shuttle service in Florida this fall.)

A representative from Seattle’s transportation department discussed the objectives of mobility services from the perspective of a large municipality - ranging from accelerating decarbonization to advancing social equity. And a former Volkswagen North America CEO highlighted the fact that current mobility offerings, in all their variety and creativity, constitute 1% of all transportation activity relative to the 99% of transportation derived from owned vehicles and public transportation.

In the course of the discussion, several preconceptions were dispelled. Beep’s successful operation in Florida was a clear demonstration of the acceptance of autonomous vehicles – particularly among a population (retirees) that might normally be considered resistant to new technology. The fixed route Lake Nona project near Orlando features Navya shuttles operating in a fashion similar to Navya’s offering in Las Vegas – including an on-board safety driver with a backup joystick type controller in case of emergency.

Alto’s operational profile gives the lie to the notion that the logistics of ride hailing is dependent on a contractor-based model with owned or borrowed vehicles. Alto continues to expand its footprint – adding vehicles, drivers, subscribers, and cities – fulfilling a need for a safer, more predictable and reliable level of service for users who like the ride hail model but are unhappy with gig-style providers such as Lyft and Uber.

The Volkswagen executive emphasized the urbanization of the planet and the corresponding evolutionary forces working against individually owned vehicles and in favor of shared and public transportation. It was interesting to see that from the car maker’s perspective all arrows are pointing away from individual vehicle ownership and toward shared or public transportation options.

The most revealing insights on the panel were delivered by the executive from Seattle. Mobility as a Service – what the industry frequently refers to as MaaS – will never take hold if it isn’t solving a problem. It is cities that are bringing their problems to the table.

The challenge, though, is that cities have lots of problems in a rapidly urbanizing world. There are population-related challenges of all kinds including housing, employment, transportation, sanitation, energy, and more. Cities are turning to the nascent mobility sector to solve all of these problems simultaneously – and that, itself, is a problem.

The Seattle executive took a holistic view of the context facing cities in North America. Many North American cities have been designed in such a way as to segregate racial and socio-economic population segments. He illustrated with demographic maps of Los Angeles, but the phenomenon he was describing is evident in cities as different as his own, Seattle, and Atlanta.

The segregation of workers has created barriers to employment specifically related to transportation. Like nearly every city in the world, Seattle sees emerging mobility services as a means to closing or removing barriers and gaps between racially and socio-economically segregated or disadvantaged populations.

This is a perspective I have read about and observed from the very beginnings of conversations around autonomous vehicles and mobility. At the inaugural AutomobilityLA event at the L.A. Auto Show more than five years ago representatives of the Los Angeles Department of Transportation described a utopian vision of autonomous vehicles ferrying disadvantaged workers to jobs located across town.

It’s an awesome vision, especially when considering the potential for autonomous vehicles to come to the aid of physically, mentally, or financially disabled citizens. There is a lot to be said for this prospect.

But it’s not enough that cities seek to leverage mobility services for greater social equality. Cities are also seeking to leverage mobility to resolve traffic congestion, reduce vehicle-related fatalities, and to reduce vehicle emissions.

While this bounty of problem solving paints a glorious picture for the potential of mobility services, it actually has the ironic impact of muddling the market opportunity and business models necessary to make mobility work. Further weakening the prospect for mobility services is the fact that the decision-making processes that impact funding for cities are slow-moving, opaque, and rife with conflict.

Worst of all, cities, generally, do not want to be the operators of mobility services. Cities want to facilitate the introduction of these services and usually want to see new transportation services feeding and fueling existing legacy options such as bus, tram, train, or subway systems – many of which are under-funded or even failing.

The Seattle executive, Chief of Strategy and Innovation Benjamin de la Pena, provided a prescription for cities to define and guide the evolution of mobility services. His five point plan included:

• Ensure new mobility delivers a fair and just transportation system for all
• Enable safer, more active, and people-first uses of the public right of way
• Reorganize and retool SDOT to manage innovation and data
• Build new information and data infrastructure so new services can “plug-and-play”
• Anticipate, adapt to, and leverage innovative and disruptive transportation technologies

De la Pena’s perspective was the most essential one among the panelists, because cities are setting the priorities for the deployment of mobility services. Cities are the constituency for these services. Cities have the problem – urban mobility - that needs solving.

Sadly, as cities open their arms, and sometimes their pocketbooks, to mobility services, problems tend to compound and evolve. Ride hailing services are welcomed in and existing taxi operators are disenfranchised and displaced. As ride hail operators introduce low cost and convenient app-based transportation, taxis are left to serve disadvantaged populations that lack smartphones or who reside in unpopular or even usafe neighborhoods.

Ride hailing operators skim off the cream of the ad hoc transportation clientele and cities are left struggling to serve needier passenger populations and solve newly-created congestion challenges created by a surfeit of Uber’s and Lyft’s. Micromobility operators are also welcomed, but, again, add to the sub-optimal traffic landscape until accommodations can be made with dedicated lanes and dedicated scooter parking areas. Geo-fencing scooters, to exclude them from some pedestrian-centric areas, has also become necessary.

Some cities, such as Paris (Autolib) and Los Angeles (BlueLA), have tried to get into the mobility game with city-run car sharing operations only to learn hard lessons regarding business models. Autolib shut its operations in Paris in 2019.

As the industry enters 2020, mobility as a service (MaaS) has great potential to solve all of the problems identified and defined by De la Pena of Seattle speaking during the Bestmile sponsored panel. The path to facilitating and supporting innovation described by De la Pena sounds like the right one. The final step in the prescription to meeting mobility challenges will be to learn fast and adapt. 

To learn fast and adapt, though, means observing and measuring performance and impacts against defined objectives. Cities can’t simply throw mobility services at the wall and see what sticks. Cities must define their objectives and their strategy or they will never succeed as problems evolve rather than resolve. The Bestmile panel at CoMotionLA helped identify the scope of the problem and the size of the opportunity.