Strategic Scenario Planning for the German Carsharing Industry – 2025 Carolin von Sethe Working Paper Version 1 March 18th, 2016 I Abstract II I Abstract What happens when the Internet of Things1, traditional mobility and the modern consumer coalesce? Nobody knows yet. The increasing uncertainty and complexity that result from the pace of technological progress, blurring boundaries between industry ecosystems and the volatile macroeconomic environment affect future mobility severely. Carsharing is at the forefront of an evolution that points towards a secular shift from individually owned-and-operated automobiles to mobility-on-demand. The purpose of this study is to develop four plausible scenarios for the future of the German carsharing industry in the year 2025 by applying the HHL- Roland Berger scenario development approach and to establish adequate core and optional strategies to aid strategic decision making of managers from companies in the carsharing ecosystem. Key Words: Scenario-based Strategic Planning ∙ Carsharing ∙ Shared Mobility ∙ Strategic Decision Making 1 The Internet of Things (short: IoT) is a term coined for the network of and communication between all devices with enabled Internet connection (Morgan, 2014). II Table of Contents III II Table of Contents I Abstract ............................................................................................................... II II Table of Contents .............................................................................................. III III Table of Figures ............................................................................................... V IV Table of Abbreviations ................................................................................... VI 1 Introduction ........................................................................................................ 1 2 Theoretical Foundation ..................................................................................... 4 2.1 Definition of Carsharing ....................................................................................... 4 2.2 The Global Carsharing Industry ........................................................................... 6 2.3 The German Carsharing Industry .......................................................................10 2.3.1 Market Overview .............................................................................................10 2.3.2 Carsharing business models ...........................................................................13 2.3.3 The supply side: Key players of the German carsharing industry ....................16 2.3.4 The demand side: Segmentation of carsharing customers ..............................18 2.4 Key trends and drivers for the German carsharing industry ............................19 2.4.1 Urbanization and changing mobility behavior ..................................................20 2.4.2 Shift in mobility preferences: Demotorization and the preference of access over ownership ................................................................................................................22 2.4.3 Customer expectations towards connectivity and sustainability .......................25 2.4.4 Re-inventing the wheel: Autonomous driving ...................................................27 2.4.5 Vision Zero: the search for alternative propulsion technologies .......................29 2.2 Theoretical Background of Scenario Planning ..................................................33 2.2.1 The Origin of Scenario Planning ......................................................................33 2.2.2 The Importance of Scenario Planning .............................................................33 2.2.3 HHL-Roland Berger Scenario-Based Strategic Planning Approach .................36 2.2.3.1 Step 1: Definition of Scope (Tool: Framing Checklist) ............................................ 36 2.2.3.2 Step 2: Perception Analysis (Tool: 360° Stakeholder Feedback) ........................... 37 2.2.3.3 Step 3: Trend and Uncertainty Analysis (Tool: Impact/Uncertainty Grid) ............... 37 2.2.3.4 Step 4: Scenario Building (Tool: Scenario Matrix) .................................................. 38 2.2.3.5 Step 5: Strategy Definition (Tool: Strategy Manual) ............................................... 39 2.2.3.6 Step 6: Monitoring (Tool: Scenario Cockpit) ........................................................... 39 II Table of Contents IV 3 Application of the HHL-Roland Berger Scenario Development Approach . 40 3.1 Definition of Scope ..............................................................................................40 3.2 Perception Analysis .............................................................................................41 3.2.1 360° Stakeholder Feedback ............................................................................41 3.2.2 Result Analysis ................................................................................................42 3.2.2.1 Blind Spot Analysis ................................................................................................. 42 3.2.2.2 Weak Signals Analysis ............................................................................................ 43 3.3 Trend and Uncertainty Analysis ..........................................................................45 3.3.1 Impact/Uncertainty Grid ...................................................................................45 3.3.2 Key uncertainties .............................................................................................47 3.4 Scenario Building ................................................................................................48 3.4.1 Scenario Identification .....................................................................................48 3.4.2 Influence Diagram ...........................................................................................49 3.4.3 Scenario Description .......................................................................................50 3.4.3.1 Eldorado .................................................................................................................. 52 3.4.3.2 Tech Invasion .......................................................................................................... 61 3.4.3.3 Upgrade .................................................................................................................. 67 3.4.3.4 Farewell ................................................................................................................... 74 3.5 Strategy Definition ...............................................................................................81 3.5.1 Strategy Corridor .............................................................................................81 3.5.2 Core Strategy ..................................................................................................82 3.5.2.1 General strategic recommendations for peer-to-peer carsharing ........................... 83 3.5.2.2 General strategic recommendations for station-based carsharing ......................... 83 3.5.2.3 General strategic recommendations for free-floating carsharing ............................ 84 3.5.3 Strategy Options .............................................................................................85 4 Conclusion ....................................................................................................... 88 V Table of Annexes ............................................................................................ VII VI Annexes......................................................................................................... VIII VII Bibliography ................................................................................................ XVII III Table of Figures V III Table of Figures Figure 1: Members and vehicles in the global carsharing market, 2006–2014 ....... 7 Figure 2: Annual revenue from carsharing services by region, 2015–2024 ............ 9 Figure 3: Market share of German carsharing operators, as of September 2015 . 12 Figure 4: Development of carsharing demand in Germany, 2008–2016 ............... 13 Figure 5: Main characteristics of carsharing business models .............................. 14 Figure 6: Carsharing readiness among German urban population ....................... 19 Figure 7: Urbanization prospects in Germany, 1990, 2014 and 2050 ................... 21 Figure 8: Global annual investments in sharing economy start-ups, 2010–2014 .. 24 Figure 9: Stages of automated driving .................................................................. 28 Figure 10: Electric vehicle registrations in Germany, 2020 and 2030 ................... 31 Figure 11: The HHL-Roland Berger scenario development process ..................... 36 Figure 12: Impact/Uncertainty Grid for the German carsharing industry ............... 45 Figure 13: Scenario Matrix for the German carsharing industry ............................ 49 Figure 14: Influence Diagram for the German carsharing industry........................ 50 Figure 15: Scenario Fact Sheet: "Eldorado".......................................................... 60 Figure 16: Scenario Fact Sheet: „Tech Invasion“ .................................................. 66 Figure 17: Scenario Fact Sheet: „Upgrade“ .......................................................... 73 Figure 18: Scenario Fact Sheet: „Farewell“