Over the next ten years, further change is to be expected:
- Electric vehicles will become mainstream
- Cities will look to further reduce congestion
- Driverless cars will gradually enter the market
Will Uber, Lyft et al continue their rapid growth and emerge as winners?
To make a well-founded prediction one needs to look at what actually drives and shapes urban transportation.
The “Urban Mobility” Market
As always when looking at a market, there are two sides to consider: the user problems / use cases on one hand, and the solutions / products offered on the other.
Here’s an overview of the use cases and solutions in urban mobility. Self-owned vehicles are not shown, as they service virtually all use cases.
Ride sharing and car sharing are approaching the market from different starting points and are addressing different use cases. Neither has yet made significant inroads in the recurring use cases of medium complexity. Thus the path for growth is different for each.
The growth path for Ride Sharing
Ride sharing — being essentially just Taxi 2.0 — has mainly addressed the use cases of adhoc and infrequent nature, taking a bite out of the taxi market and expanding it somewhat through increased convenience and lower cost. Uber has not, however, become a staple for the average urban commuter with access to public transport, nor is it routinely used by parents lugging kids, gear and groceries between activities.
To effectively address these additional use cases, ride sharing needs to further lower costs to beat public transportation on recurring trips, and find solutions where goods and gear can be hauled in multi-stop trips. Without those additions, ride sharing will essentially remain Taxi 2.0.
However, the digital-only focus of Uber et al to date means that there are several core capabilities these firms have not developed. They don’t own cars and thus have no experience in fleet management like car rental- and transportation companies. They don’t have a strong track record in working with municipalities and public transport companies, so if you’re hailing a ride with Uber, you won’t be speeding along in the Taxi and Bus lanes, nor will you be picked up in special areas at the train station or airport where taxis are waiting. Those are luxuries that comes with conforming with regulations and paying the fees, as it were.
The growth path for Car Sharing
While ride sharing captured most of the attention in the last few years, car sharing companies were quietly evolving in the background, launching services in a growing number if cities across the world. Offering short-term car rentals, charging by the hour or by the mile, they offer a hassle-free way of accessing a car when you need one.
Initial services from early-movers such as ZipCar and Car2Go were typically station-based. You had to pick up and return the car from a specific location, similar to traditional car rentals. In the last few years, these services have shifted shifting towards “free floating” fleets, where you can pick up and drop off the vehicle at any public parking spot. Vehicle access has also been streamlined, often allowing you to open and access the car with a touch on your smartphone. These and other improvements have significantly lowered the friction of getting access to a car when you need it, and is enabling car sharing to grow further into the recurring type of use cases.
There are currently three types of players in the car sharing market.
1. Multi-city operators with Proprietary Platforms
Car manufacturers and car rental companies are now owning the largest operators:
- Car2Go (now owned by Daimler)
- ZipCar (now owned by Avis)
- ReachNow and DriveNow (owned by BWM in partnership with Sixt)
- Hertz 24/7 (owned by, you guessed it, Hertz)
- Maven (owned by GM, based on acquired Sidecar)
Similar investments or partnerships have also been made by Ford, Toyota, Enterprise, etc. In general, these companies both develop the digital platform as well as operate car sharing in select cities.
Car rental companies are experts in fleet management, while car manufacturers are not, which is why the latter have either acquired an existing car sharing startup or are partnering with a car rental company.
2. Local and Regional operators with 3rd-party Platforms
Besides the larger players listed above, there are dozens, maybe hundreds of car sharing operators with a smaller footprint. Sometimes operating in just a single city or within a country, these operators partner with platform providers instead of developing the software and hardware themselves. While they do need to make capital investments in acquiring cars, the UX and back-end comes from the platform provider.
3. Car Sharing Platform Providers
Several startups provide the platform for operating car sharing, without being operators themselves. Main players in this role include Vulog and RideCell, both with double-digit operators using their platforms. Typically, the platforms include all the components required to become an operator, save the cars themselves: the hardware required to outfit the vehicles with digital access and geo location, the Mobile UX for drivers, and analytics to support operations with fleet repositioning, vehicle maintenance, and more.
Source : https://medium.com/swlh/why-uber-lyft-and-didi-wont-dominate-urban-mobility-but-who-might-c41823d10397