What Will Replace the Private Car?

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By Sampo Hietanen, CEO and Founder of MaaS Global

The biggest question in the world of transportation at the moment is: ‘What is the solution that will seriously rival and eventually replace the private car?” The extreme and the obvious – and therefore quite uninteresting – answers are:

1) nothing ever will or

2) public transport, of course.

These answers are shallow and lazy takes on a complex and fascinating world of mobility that is more psychology than engineering, more existential struggle than economics.

I like to think that we, the ones trying to crack this question in disruptive, yet constructive ways, are working on a field of dreams. What I mean is that rational arguments carry only so far, while the real challenge is to appeal to feelings.

Why do people spend 85% of their personal transport budget on a car, when they only use it for 29% of their travels? The answer is not that they are unaware of the discrepancy, and if they only were educated, the problem (the inefficiency, the ecological burden, urban congestion) would go away. The answer is that they want to keep the dream alive. The dream of getting anywhere, anytime, with friends or family. It is about the idea of freedom. People pay to get around, but also for the possibility to get around even when they don’t.

So, how do you cater to that dream? If freedom is what people want, then forcing them into a one-size-fits-all solution does not stand a chance in a free society. Public transport is great and a vital component of any future mobility solution in crowded areas, but it should not be something forced upon people by the authorities. It should be a choice, part of an offering that makes people feel free.

When people are asked what it would take to make them give up their cars, the answer – almost in unison – is: ”If someone could promise that I could get wherever I wanted, whenever I wanted to.” It is a little bit like AirBnB and Uber. Their success is due to them being able to provide the trust factor, not just the convenience factor where it did not exist before.

So the answer, the magic sauce, is reliability. In the world of transport people want freedom and someone has to guarantee it to them. At MaaS Global we look at this challenge as the three steps of magic:

1) We have to provide all desired mobility options as a one-stop shop,

2) We have to offer roaming so that our service works anywhere in the world,

3) We have to fix any hiccup that may occur: if the bus does not come, we’ll get  a taxi, if that fails a car share, if that fails an Uber – and if nothing else works we’ll get you there in a friggin’ helicopter (actually, sorry, we cannot do helicopters just yet, but you get the point).

”Yeah, that makes sense”, I keep hearing when I lecture on this, but then people add, ”but it would never work here. Here (…fill in the blank) we just love our cars too much.” Often these doubters are gentlemen well into their 50s who are failing to see the quiet revolution taking place. Among the young, the car is not what it used to be. The percentage of kids that decide to get a driver’s license is down everywhere. In Great Britain in the 1990s, 80% of people were driving by 30. Now that number is down to only 45% . In Stockholm, of the kids that reach driving age, only 9% get a license. This trend is clear even in the United States, although not as dramatic.

So, the cool new thing among young consumers is not to drive. And that is going to give a massive boost to services which replace the private car. Plus, right around the corner awaits another game changer: automated vehicles will start doing the driving for them. This does not and should not mean that they would start buying automated cars or use only those (the congestion problem would only get worse), but as a component in an overall solution, self-driving cars will push prices down and free up space that is currently being used for parking.

When the freedom factor is established and prices start to drop, there is very little that can stop the big wave. Rethinking traffic this way, not just as an engineering problem but as a psychological sea change, will bring savings and opportunities that are beyond anything we have seen so far regarding digitalization.

Right now, those that care to listen, can hear the rumble before the quake.

Author

Sampo Hietanen

Widely acknowledged as one of the founding fathers of Mobility-as-a-Service, Sampo is the founder and CEO of the incredibly successfully MaaS Global company based in Finland. Coming from a ITS and civil engineering background, Sampo has spearheaded multiple new business models and technology in the transport industry. The most relevant to Mobility-as-a-Service being Whim App which recently secured some 10 million Euros in a partnership with Toyota.

Sampo is a BusinessMaaS influencer – You can see more of him here.