MaaS: The Mobility Revolution Coming to North America Ongoing urbanisation in North However, in many metro areas the America has led to worsening rise of ride-hailing has increased traffic and congestion in cities traffic congestion, as drivers often across the US and Canada. The drive around passenger-less former has registered a 160% waiting for their next fare. increase in urban population since 1980, which has significantly One transport concept that Introduction increased vehicle miles travelled capitalizes on the increasing (VMT) in cities. Traffic congestion use of shared mobility and has increases localized air pollution potential to alleviate congestion Transport has always been one and has a negative impact on and pollution problems is mobility- of the largest greenhouse gas the economy and productivity as as-a-service (MaaS). MaaS is the people are stuck in traffic at the integration of multiple forms of (GHG) emitting sectors, but in expense of being economically transport, both public and private, recent years it has overtaken productive. These trends prompt to create a seamless mobility questions around whether there system. electricity generation as the are more sustainable ways to get most emitting sector in the US around our cities. A MaaS system brings planning, booking, and payments for and in many of the world’s Urban passenger transport has multiple modes of transport into already been disrupted by the rise an integrated platform. In the largest economies. of transport network companies most developed MaaS systems, (TNCs), such as Uber and Lyft. In customers can purchase mobility 2015, only 15% of Americans had service packages instead of ever used a rideshare service, but owning individual modes of in the following year that number transport, such as a private car, jumped up to 36%. Ride-hailing bicycle, or monthly metro card. and ride-sharing provide mobility Indeed, it is this convenience without the hassle of driving, (thereby cutting down on “app parking, owning a car, insurance fatigue” from switching between and maintenance, planning around different apps) that will help drive public transport timetables, or increased MaaS adoption. waiting at bus or metro stops.
2 3 Defining MaaS transit as well as a certain number of miles of ride-sharing or uses of There are multiple levels of MaaS bike-sharing for a monthly rate integration. According to the paid to the MaaS provider. Only topology developed in Sochor et. three “Level 3” schemes have been al. (2017), the first or most basic designed to date, none of which level allows for multimodal trip are available in North America. planning. Examples of this first level can be seen somewhat in Whim, a MaaS platform based in the Google Maps trip-planning Helsinki offered by MaaS Global, functionality, as well as other is the most sophisticated Level 3 apps, such as Citymapper. The scheme. Residents of Helsinki can second level of integration is the use the Whim app to plan and pay ability to book and pay for rides for all modes of public and private with multiple different transport transport in the city, from train and providers through one app. Today taxi to bike-share and carshare, we see that capability emerging at or any combination of these. Users Uber and Lyft with their integration have the option to pre-pay a of micro mobility and public transit monthly subscription or pay as they in some cities, as well as some city go with a linked payment account. transit apps. The fourth level of MaaS The third level of integration integration incorporates societal iinvolves the bundling of goals, by implementing incentives subscriptions or contracts for that influence travel behaviour. multiple modes of transport on one For example, this would include platform. The user would not have penalising trips at rush hour or for to book individual trips but could driving downtown. have a monthly pass to use public
Fig. 1 Total Addressable Global Mobility Market, 2020 (USD millions)
134,925 127,970 84,326 1, 073,742 5,753,875
Ride Hailing Personal Public Rental Micro Mobility 4 Source: inspiratia, Goldman Sachs 2019 Sustainability potential and options are integrated into MaaS, the more likely people of MaaS will see alternative modes as Whether MaaS systems will genuine competition for a personal help urban areas meet their vehicle. MaaS’s potential to sustainability goals depends on the make passenger transport more system’s ability to reduce emissions sustainable in cities lies in its ability and congestion. So far there are to change travel behaviour with limited studies on the emissions very little additional infrastructure and congestion impacts of MaaS, or vehicles. This is crucial in cities but one study in Nordic countries that are strapped for funding for shows reductions in both CO2 public transit. emissions and vehicle kilometres travelled (VKT). To reduce both In addition to providing convenient emissions and congestion, a MaaS integration, European MaaS program must be structured so as programs have been successful However, Level 4 MaaS schemes are still to incentivize a transition away at reducing emissions and car aspirational as none currently exist. The massive from private vehicle ownership use because they have featured size of the global mobility sector means that, toward fleet ownership and public transit on their platforms depending on how one defines the sector, the operation, P2P vehicle sharing, and have worked closely with total addressable market (“TAM”) that MaaS and public transport systems. governments to implement their providers have as their target is comfortably solutions. According to a survey above US$7 trillion in 2020. Pilots of MaaS in Europe have conducted by the American Public shown that it can help reduce Transit Association (APTA), most The bundling of mobility on a single platform private car use. During the people still see public transit as presents a shift away from ownership-based pilot of Smile in Vienna, 21% of the “backbone” of a transport transport systems towards access-based participants reduced private cars system and 74% of millennials ones. This has positive implications from both usage. During the trial of UbiGo said they would use a MaaS app a sustainability and traffic point of view. In in Sweden, 44% of participants that includes public transit. This Helsinki’s experiment with Whim, the aim is to reduced their car use. Positive indicates that MaaS could have an make it so convenient to get around using the perceptions of private car use important role to play in reviving options available on the platform that people also decreased during the pilot, public transit’s role in our cities. forego their personal vehicles because the and support for alternative modes alternative is more appealing. increased. To change perceptions Electrification of fleets can reduce and compete with car ownership, emissions and air pollution, but Already Whim users ride on public transit MaaS has to offer “something with limited integration with public for 63% of their trips, more than the average pretty spectacular,” according to transport will not be effective at urbanite in Helsinki who only uses public Krista Huhtala-Jenks, the head reducing congestion. Whether transport 48% of the time. This has positive of ecosystem of MaaS Global, or not North American MaaS implications for the sustainability of MaaS and Whim’s parent company. programs can offer the same its ability to get people out of private vehicles. sustainability benefits as European What MaaS can offer is equivalents will depend on the convenience. The more payments extent to which they integrate public transit and work with local governments. 6 7 Status of MaaS in North partnerships and higher quality America public transit. While there is some debate over MaaS in North America is up the size of the global MaaS against car ownership rates that market, ride hailing alone is are higher than anywhere else in estimated to have reached a the world, as well as an ingrained global market size of US$108 car culture. TNCs, third-party app billion in 2019 with the United providers, and cities are working to States accounting for just under change this and satisfy demand for US$40 billion. Due to increased MaaS in cities. urbanisation, transport demand is shifting to shorter trips throughout TNCs move towards the day in more urban areas, which would suit MaaS well. While there MaaS is clear demand for more MaaS TNCs are the largest promoters of solutions, there are relatively few MaaS in North America, offering fully integrated examples available ride-hailing, e-scooters, and bike- in North America. sharing services in their apps. Uber and Lyft – which together account Currently, different modes of for more than 99% of current transport each require a separate offerings in the ride hailing sector payment method: a bike-share may in North America – have been have one account, ride-hailing working to rebrand themselves another, and public transit its own from ride-hailing companies to tickets, while the success of MaaS mobility platforms. in Europe centres on public-private
Fig. 2 Ride-hailing market share & revenue, United States 2019
Lyft, 3.6 Uber, 3.6 billion (USD) billion (USD) 35% 65%
Lyft US Market Share Uber US Market Share
Chapter 1 / Embracing the new energy revolution 8 Source: inspiratia, Uber 2020, Lyft 2020 9 Summit, New Jersey has signed Now commuters are able to watch a partnership with Uber to help on screen where and when transit get commuters to and from their vehicles will be arriving and bike local rail station. This helps the lanes are now being displayed city avoid using taxpayer money too. Lyft also has plans to add to fund an expensive new parking a comparison tool for time and garage – a multimillion-dollar cost across different modes and project – by reducing the number recommend the fastest and most of cars that will park by the station. affordable options. The company envisions eventually creating a This partnership increases subscription service for all transit convenience for the users, as types. parking near the train station is challenging, with commuters often However, currently Uber offers the wasting time looking for parking. ability to pay for public transit on Both are adding real-time public transit information to their The town estimates that it will save the app in some cities, whereas apps in some cities. So far, this roughly equates to Level 2 $5 million of expenditure over the Lyft only provides scheduling of MaaS integration for the modes that also have payment course of 20 years as a result of capabilities. options within their apps. However, while TNCs offer some this partnership. of the most widely available MaaS solutions in North In 2018, Lyft launched a “ditch America to date, questions exist about their commitment to More generally, Uber has your car” promotional challenge in sustainability. integrated public transport over 30 cities to around 150,000 schedules in its app in almost participants. In exchange for Uber 50 US cities. If an Uber rider is giving up their car for a whole CEO Dara Khosrowshahi has proclaimed that Uber’s aim heading to a train or transit stop, month, participants received is to become the “Amazon of transportation.” To advance the app will display upcoming about $550 in credit to use for Lyft this goal it has joined MaaS Alliance, a public-private departure times. Uber has also rideshare as well as bike-share, partnership made up of organisations largely based in begun to offer the ability to car-share, and public transit. In the Europe that aim to develop an open market for user-centered purchase metro and bus tickets in pilot in Chicago, this was broken new mobility innovation. Uber has also incorporated the its app with pilot programs in cities down into $300 in Lyft credits, short-term rental of e-bikes and scooters into its app. It has a such as Denver, Colorado. $105 for bus and metro services, lead on its main competitor, Lyft, based on scope and scale. $45 for a Divvy bike-share pass, Lyft and $100 in Zipcar credits. Lyft Uber also has an advantage over other potential MaaS promotes its shift to MaaS offerings providers in that it is accelerating its internet of things (IoT) Like Uber, Lyft has been moving as an effort to reduce reliance on innovations and already leverages big data at scale. It can towards more integrated mobility cars in cities. use insights from data to propose new strategies for cities solutions by incorporating shared and consumers. Ideally, Uber would like to integrate all of its bikes, scooters and public transit Lyft is vying with Uber to be the services into one app, including ride-hailing, e-bikes, food times into their app. It reports that primary way that people get delivery, and public transit ticketing. these measures have encouraged around. more people to use these travel Uber is aiming to team up with cities and public transport modes, which are less polluting In 2018, it too announced its first agencies to create tailored MaaS solutions. For example, and congesting. subscription plan and step towards
10 11 level 3 MaaS integration: the Lyft of 1.7%. In obtaining rides that All-Access Plan, which is now Lyft would have otherwise been Pink. Lyft Pink is $19.99 a month provided by public transport, TNCs and provides a 15% discount on are increasing road congestion all car rides and three free rides on and emissions (if not using electric Lyft scooters or bikes each month. vehicles). To recoup the membership fee a user would have to spend around In places where more sustainable $133 with Lyft, making Lyft Pink an options like public and active interesting option for a minority of transportation are not available, commuters. the introduction of a TNC MaaS solution would only result in Sustainability of TNC- people switching out of their own car into one being driven by based MaaS Solutions someone else, likely often taking The major TNCs already have the trips alone. Uber and Lyft have largest reach and are perhaps also not had enough pooled rides most likely to provide more to compensate for the emissions or integrated MaaS solutions at scale. congestion caused by their private rides. Via, on the other hand, offers However, if the future of MaaS in primarily pooled rides—95% of North America is dominated by all rides globally to be exact. For Uber and Lyft, then the question comparison, in New York City, only is whether they will go beyond 20% of Uber and 35% of Lyft rides being a one-stop shop and make were shared in November 2018. serious commitments to reducing traffic and emissions. A model Public-private partnerships are that focuses more on reducing at the heart of successful MaaS car ownership and increasing solutions, and the large TNCs public transit use, ride-pooling, are known to often have mixed and partnerships with cities (such relationships with the cities within as that of recent market entrant, which they operate. In 2014 Via) has much greater potential Seattle came close to shutting for reducing emissions and down TNC operations if they didn’t congestion. start carrying more insurance. New York City has extended its Ride-hailing, the primary part of cap on the number of new driver the TNC business, is often in direct licenses available to big TNCs competition with public transport. over concerns of congestion One University of Kentucky study and low driver wages. To avoid shows that for every year ride- leaving MaaS platforms entirely hailing operated in a US city, in the hands of private companies, bus ridership fell by an average cities could act like an “app store” for transport, allowing private
12 13 in Washington, DC. public transit data to integrate into the app, Transit sells its Transit consumer mobility data to the cities. Public authorities allow Transit is a Montreal-based Transit to incorporate their tracking transport planning app, with data, sometimes in exchange for the stated purpose of being, Transit completely taking over the “...the killer app for urban municipal transport tracking app, transportation… By making public saving cities money. For instance, transit simpler, and alternative Transit allows customers in St. modes more accessible, we Louis, MO, the ability to plan and facilitate billions of car-free trips.” book multi-modal trips, having To do this, Transit works to make replaced the city’s previous trip- public transport more efficient and planning app. Moreover, in St. companies to participate, but it is the city that would set the attractive to riders. Its app displays Louis, Transit also allows users to guidelines. arrival times of nearby transit book rides with Uber or Lyft. In as well as planning routes and addition to St. Louis, Transit has While Uber has said that public transport is one of its main journey times. partnered with transport authorities competitors, Via positions itself as a complement to public in Boston, Maryland, Santa Clara, transit systems, as well as a new transit solution for sprawling This helps reduce the risk of riders CA, Tampa, and Montreal. auto-centric cities with little transit infrastructure. not knowing whether they arrive at their destination on time with Free2Move As long as the focus of North American TNCs is on increasing public transport, forcing them to ridership and not getting people out of cars, or transitioning call a taxi. While the TNC’s share Free2Move is a mobility platform their vehicles to ZEVs, they will not be able to reduce both this desire to reduce car use, it is launched by the French car emissions and congestion in cities. often at odds with their business company Peugeot (“PSA”). PSA model of having thousands of cars launched the platform to compete in as many cities as possible. in a rapidly transforming mobility Mobile apps providing MaaS space, especially as a mid-tier In addition to TNCs, mapping apps such as Google Transit is perhaps the closest to car company. While Free2Move Maps, Apple Maps, Citymapper and Transit are providing providing Level 3—or subscription itself offers car-sharing, it is MaaS solutions without supplying any vehicles. Some are level—MaaS integrations with also integrating other modes of considered only Level 1 MaaS integration—such as Google public transit. In some cities, transport into its app. Primarily Maps, Apple Maps and Citymapper—allowing users to Transit already offers booking and based in Europe, Free2Move is plan but not book multimodal trips. Transit has taken MaaS payment options without having to expanding into North America integration a step further by incorporating in-app booking leave the app for bike-share and by offering its free-floating car- in certain cities. Other apps add their own twists to trip- public transit, and it has plans to share in Seattle, Portland, and planning and booking: Migo integrates on-demand rides incorporate payments for free- Washington, DC. Free2Move is such as taxi, carshare, bike-share and scooter; Cowlines floating scooters. starting to experiment with more allows users to see the carbon footprint of their trip; and integration in Washington, DC. Free2Move is experimenting with integrating shared mobility Transit’s business model, like Via’s, focuses on partnering with Users can reserve or unlock cities. In exchange for access to carsharing, e-scooters, and
14 15 bike-share. They do not have any system is working well and what integration with public transit yet communities need more access to but are focusing on car-sharing mobility. By being highly involved and other bookable vehicles, in the design of MaaS platforms, like e-scooters and bike-share. cities and municipal transit In addition to providing its own agencies can better ensure that free-floating car-sharing fleet, their goals and the needs of their Free2Move has partnerships with residents are being met. Car2Go car-sharing, Bird scooters, In the US, public transit ridership Capital Bikeshare, Lime scooters, is down 5% over the past Skip scooters, and Jump e-bikes. In decade, yet the need for it Europe, Free2Move offers fleets of and complementary solutions hundreds of electric vehicles (EVs). continues to increase as urban populations are projected to grow. Cities transforming Underfunding and insufficient maintenance have led to a decline transit with MaaS in the quality of service in terms of Cities have a central role in frequency, punctuality, and overall theadoption of MaaS solutions. experience. Rather than partnering with private companies, some cities To reverse this trend and meet are working on their own consumer needs of reduced wait MaaS offerings. Cities often times and more robust service, know best where their transport transit agencies can partner
Fig. 3 Public transit market growth scenarios (ex. ride-hailing), North America 2019 -2030
110
105
100
95 USD billions USD 90
85
80 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
High growth Base Low growth
Source: inspiratia, APTA 2019
16 Improving MaaS Minneapolis, and the greater Toronto area. Metrolinx in Toronto, sustainability in the for example, has already created future 51 mobility hubs and Minneapolis is starting a pilot program with MaaS by itself offers the potential mobility hubs, unveiling four in for some sustainability benefits by September 2019 with plans to competing with the convenience build 12 in total. These hubs consist of cars. MaaS could perhaps of a bus stop, designated bike- be even more convenient and share and e-scooter parking and effective at getting people out way-finding signage with travel of cars by integrating with more times to points of interest. physical infrastructure. A mobility hub is the physical integration of The creation of mobility hubs with private groups to extend their existing multiple modes of mobility, which could be crucial to help make infrastructure, use data to better understand would complement perfectly the North American transport movement of people and consumer behaviour digital integration that is already greener, especially since the built in their jurisdiction, and develop demand- happening in MaaS. environment and culture so highly response solutions to stay flexible to changing favours the private vehicle. One consumer demand. Integration may be able Mobility hubs are locations and anticipated benefit of mobility hubs to benefit public transit providers by bringing infrastructure where travellers can is reducing the need to drive alone. multiple services together and offering a more connect to or rent various forms Well-placed mobility hubs could flexible transport package to the consumer. of transport, such as a parking help get people out of private Private companies often have better expertise garage by a commuter rail vehicles for the 45% of trips that than public institutions in getting a MaaS station with a bikeshare station, are under three miles. With more app up and running, as they tend to have car-share EVs, a bus stop, and travel choices and supporting more resources and workforce skills in the a designated ride-share pick amenities, there will be fewer technology. up area. At a mobility hub with reasons to own a car. MaaS a traveller could seamlessly City-led MaaS programs may also have hop off one mode of transport Better connecting bike and ambiguous impacts on congestion and onto another. They should be pedestrian infrastructure can get emissions, depending on what their primary located near concentrated points people out of vehicles all together, goals are. Efforts to increase mobility access of employment, housing and/or helping to reduce congestion. may increase congestion, pollution, and recreation. Mobility hubs might By providing amenities like EV emissions if people who use public transport also provide walking and biking charging stations, mobility hubs switch to motorized modes (especially if they infrastructure with appropriate could also help reduce emissions are not EVs). However, this effect may be parking and charging, support and air pollution by promoting EVs. balanced if the program is lucrative enough to services like real-time travel get people who used to drive to use alternative information and parcel delivery Once autonomous vehicles fully modes of transport. The impacts will be lockers. enter the market, mobility hubs determined by the aims of the city along with could be essential infrastructure to the levels of integration and convenience that Cities that have planned the enable people to catch a ride, but the MaaS system provides. creation of mobility hubs are San also allow for a place for AVs to Diego, San Francisco Bay Area,
18 19 be stored and charged in between backbone of future connected rides. To make future transport AVs, especially since companies more sustainable, shared, active, like Uber are developing plans in and public transport need to be this area. The behaviour patterns more convenient than personal car that are established by these early ownership. MaaS with mobility MaaS platforms in regard to how hubs could help bring that future. much of transport is shared, active or public, will have a great impact on congestion and pollution in Conclusion cities and may inform how future MaaS has the potential to be AVs are integrated into the larger an improvement on our current transport system. inspiratia uncoordinated transport systems data yields significant growth and enhance urban mobility at projections for the North American a lower cost with less congestion ride hailing market in the coming and environmental harm. However, decade even under low-growth North America still has very little scenarios, potentially reaching experience with MaaS platforms a market size north of US$350 and will have to undertake many billion by 2030 in high-growth more trials before finding solutions circumstances. that work in each city. Convenience is one of the prime The technology behind MaaS benefits of MaaS. By including platforms now will likely be the all of the available companies in one platform, MaaS can remove
Fig.4 Ride-hailing market growth scenarios, North America 2019-2030
400 350 300 250 200
USD billions USD 150 100 50
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
High growth Base Low growth
Source: inspiratia, APTA 2019
21 barriers to forms of transport that Currently, many MaaS offerings The sustainability of North mixed prospects. TNC-based may help reduce emissions and are not accessible to lower income American MaaS is also challenged MaaS models will need to have congestion. They can also help and older residents, since most by the behavioural habits and the aim of increasing public transit refocus public transit offerings on platforms require the use of a infrastructure prevalent in the ridership and working with cities, ever-changing customer demand, smartphone and to having access region. In many cities driving is the rather than increasing ride-hailing, by offering a more flexible variety to a credit card or bank account. norm, often because public transit to truly improve congestion and of transport options. Relationships with municipal is not reliable and active transport emissions. App-based MaaS governments will also be key in is not available or safe. It will be models do not have that conflict At the same time, the increasing further MaaS development and will more difficult in these cities to get of interest but will likely be able popularity and integration of help determine how aligned MaaS people out of their cars and into to better reduce emissions and micro-mobility offerings in the platforms are with cities’ goals of more sustainable options. For this congestion if that is explicitly MaaS platforms and TNC offerings reduced congestion. reason, partnerships with the local part of their goal. Many city- in North America lead us to government could be particularly based MaaS programs aim to project rapid growth in the sector These solutions are applicable helpful since MaaS public-private increase access to mobility, so in addition to the growth expected across huge swaths of the mobility partnerships can provide budget their sustainability impact will in the ride hailing sector as well sector including commercial relief as the city works to build be dependent on whether they with base-case projections in the transport and freight services and and maintain its public transport get more people out of cars onto range of US$200 billion market are part of a total addressable infrastructure. transit than they get former non- size by 2030. For MaaS to really global market projected to grow travellers or pedestrians onto take off in our urban environments, well above US$8 trillion by 2030. The sustainability of MaaS transit and shared mobility. it is important that it is accessible to programs in North America has everyone.
Fig. 6 Total addressable market growth projection, Global 2019-2030 Fig. 5 Micro-mobility market growth scenarios, North America 2019-2030
9,000 300 8,000 250 7,000 200 6,000 150 5,000
USD billions USD 100 4,000 50 3,000
0 2,000 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 1,000 High growth Base Low growth 0 Source: inspiratia, McKinsey & Co. 2019 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Rental Personal Public Ride Hailing
Source: inspiratia, Goldman Sachs 2019
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