The Future of Mobility Needs to Prioritize Personal FreedomBy MBN Staff | Fri, 04/29/2022 - 12:00
Q: How are preferences regarding car ownership impacting the demand and reception of MaaS Global and Whim’s services?
A: There is an ongoing technology disruption within the mobility sector, which has led to the development of Mobility as a Service (MaaS) and will shape the future of mobility. Vehicles represent 76 percent of the total value of the mobility market and 20 percent of a household’s expenses go toward mobility. But because household cars entail a large amount of idle time, it is likely that this model will be disrupted. The challenge is changing the historical attitude toward car ownership. Owning a car has been a dream that resembled freedom for about 100 years. Therefore, we have to enter that space and provide the same personal freedom.
To our advantage, 15- to 35-year-olds do not dream of owning a car anymore, especially in the developed world’s urban areas. Even in the US, which is the dream land for car ownership, the age when people get their driver’s license has been increasing for the past two decades. Simultaneously, those without cars are extremely underserved and their freedom to go anywhere anytime on a whim is more limited. Our job is to provide these services without a change to personal freedom.
Q: What role has the COVID-19 pandemic played in shifting these attitudes?
A: COVID-19 definitely impacted this shift but we have yet to see the long-term impact. As more people work remotely, business trips have declined while leisure-related trips have increased. There has also been a shift in traffic peaks, which used to take place in mornings and afternoons, and an increase in the acquisition of used vehicles, although this might be a short-term effect.
People are looking for long-term options that provide freedom without commitments. We aim to get 1 million people to give up car ownership by 2030 and be perceived at the same level as the main car brands like Mercedes or Tesla. Within Mexico, there is a similar need for freedom but there is also a segment we call “car hesitant:” 25- to 35-year-olds who are out of universities and earning enough to buy their first car but do not want the commitment, hassle or risk.
Q: What efforts are necessary to achieve MaaS’s vision and in which markets have you had the most progress?
A: We are the first to offer a solution of this kind so there is a long road ahead. Most of our data comes from Finland, which has a similar population to a Mexico City suburb so it is a good sandbox to start in. In Finland, 24 percent of our clients avoided buying a car or they gave up theirs with our help. As we grow, our impact could be quite large. Our main markets are usually developed cities with a high ratio of smartphones where people are used to different modes of transportation.
In Mexico City, surprisingly enough, the pieces to provide people with a transportation service already exist. I have given over 2,000 speeches on this topic and often men over 50 say that our solution could work in Finland, but that people in Mexico, the US, Sweden or Switzerland just love to own their cars. But almost every time, there is someone below 30, often a woman, who will approach me and say that if she had a convenient package with someone looking after her, she would go for it almost immediately.
Q: What services do most customers seek beyond public transportation?
A: It is possible to offer customers all the public transportation of a city but they will still want to know what happens if they need a car. One of the largest challenges is to create liquidity. If I were to say, “Push a button and within five minutes a beautiful car will be delivered to you,” would that be good enough? This can be done using the inventories of different vendors.
There are four reasons people need cars: immediate need, which free-floating car-sharing services can provide; a need for cars with space for groceries that are only needed for a few hours, which can be covered with station-based cars; weekend travel cars, which car rentals and serviced cars provide; and what we call in the EU summer cars, for which car rentals and modern car leases are good enough.
Q: How does the Whim PAYG payment option benefit users?
A: MaaS offers numerous packages, from low end to high end, depending on the customer’s need and budget. The simplest solution is a single app instead of several mobility apps and a pay-as-you-go model. From there, we offer subscriptions that give clients unlimited access to certain services, such as monthly access to public transportation and some extras, such as leased scooters or bikes. Finally, MaaS can offer an all-inclusive service that could be used throughout the entire country for less than the price of car ownership. In the EU, people spend about US$700 on average a month on transportation, so the model could be priced at US$600 and offer unlimited access to buses, trains, subways, taxis, car-shares and car rentals.
Q: What sustainability benefits does MaaS Global offer clients and the cities in which its solutions are adapted?
A: Transportation represents a large percentage of CO2 emissions. In the EU, transportation represents 25 percent of all emissions but will climb to 40 percent by 2030. In Sao Paulo, Brazil, about 70 percent of emissions are related to transportation.
People cannot stop moving but replacing car ownership opens the door to other services. In Helsinki, Finland, we observed that once the population started making that shift, the city introduced several sustainable services: more public transport, micro-mobility and bikes. The problem with many of the existing policies is that they accept the status quo of transportation and try to change it a bit when policies should focus on replacing the whole system. That is where the largest impact will come from.
Q: What are your company’s goals for 2022 and your middle-term plans?
A: This year, our goal is to recover from COVID-19. Within the EU, Japan and Brazil, we want to show that we are back on track. We also plan to continue proving how the unit economics of MaaS work. It is not easy being the first in the world because we have to prove the validity of the model. We have to demonstrate that there is traction and that we are scaling up.
Toyota, one of our investors, recently asked us our goal for 2030 and I said that, at least, we would be bigger than them. When we become the largest company on Earth, then we will have accomplished what we set out to do.
MaaS Global, founded in 2015, is expanding the Mobility as a Service (MaaS) concept among public and private transportation providers though a single app.