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HIGH FIVE

1: Mobility as a Service (MaaS)

The increasing adoption of Mobility as a Service is the most significant trend facing the mobility industry. MaaS refers to on-demand services that give travellers the freedom to choose between different types of transportation through an easy-to-use service, often through smartphones and a single payment point. This can include options like ride-hailing, car-sharing, scooter-sharing, bike-sharing, public transport, and others. This is often more convenient for the consumer than traditional car rental services and promises to reduce traffic congestion by adding fewer cars to the road. According to market researcher Reports and Data, the MaaS market will expand more than eightfold over the next few years, from approximately US$42 billion in 2018 to US$372 billion by 2026.

2: Agile competition & partnerships

Increasingly the mobility industry is turning towards more customer-centric strategies which offer users greater selection. Perhaps this is most clearly shown in the new competition which is emerging, with asset-light companies such as Truro, Lynk & Co, and Kyte increasingly able to challenge the more traditional car rental companies. This is often through innovative partnerships. For instance, Ericsson and Lynk & Co launched car-sharing through remote smartphone access, offering an innovative new mobility solution. Traditional companies are also making use of partnerships, such as the Hertz-Tesla affiliation and Uber-BMW promotion. This gives the mobility company publicity and access to the partner's consumer base.

3: Autonomous vehicles

What was once the realm of science fiction is increasingly becoming a reality. The use of autonomous vehicles (AVs) in contained and well-defined environments is a very real possibility in the near future. This may come before many anticipate it. Noah Zych, global head of Uber Autonomous Mobility & Delivery, says the company “has strong aspirations of where we’ll be with AVs in terms of transportation and deliveries by 2030”. The adoption of autonomous vehicles would mean a massive shift in the mobility industry. The widespread uptake of autonomous vehicles will have a significant impact on mobility costs and convenience for consumers. For instance, shared vehicle arrangements will be more practical if cars can drive autonomously from one user to the next.

4: OEMs entering the rental space

Original equipment manufacturers (OEMs) refer predominantly to car manufacturers, but also any manufacturers of the hardware used by the mobility sector (for example, electric scooters). OEMs are increasingly trying to engage directly with consumers to provide mobility, leaving their comfort zone of merely selling cars. We are seeing this in two ways. The first is in partnerships between car rental brands and OEMs. A good example of this is Polestar, a Swedish electric vehicle manufacturer, which has committed to delivering more than 65,000 cars to Hertz. The second is through increasing engagement with consumers through software. This includes wireless updates straight to a car's operating system. Although still in its early stages, OEMs entering the mobility space is something that needs to be watched. These huge companies with significant resources could be well positioned to carve out a space in the industry as it shifts towards MaaS.

5: Big data

Data has a big role to play in industry expansion, allowing mobility companies to be more efficient by driving costs down and improving the user experience. Data will drive many of the functions which are key to MaaS. One such use could be in optimising fleet routes, allowing vehicles to be placed in the ideal location, and forecasting future usage patterns. Major car rental companies like Europcar and SIXT are increasingly embracing big data to use on their own fleets. Data will provide the core building blocks which enable search functions and provide users with the best deals and fastest routes. It is also key to providing a more user-centric experience because showing customers the right offers at the right time can unlock additional revenue.

Staying on top for the future

The mobility industry is growing, but it is changing. This is cause for excitement but also for reflection. Identifying the drivers of this change and analysing how this change will manifest itself is key to a sustainable business model. Trends such as the shift to MaaS, data and partnerships, and increasing disruption from OEMs and autonomous vehicles cannot be ignored.