Monday, June 12, 2017

Some thoughts about autonomous vehicles and the future of carsharing

Earlier this month I was a speaker at the Connected & Autonomous Vehicles Conference, part of the larger Internet of Things World Conference in Santa Clara, California, May 17, 2017.  I was on a panel discussion introducing shared mobility with Steve Messino, CEO of MuvMe, a carsharing/on demand car rental platform provider.  

I'm skeptical about how fast the conversion to autonomous vehicles is going to happen, so I was interested to hear from a number of other speakers in the autonomous vehicle industry saying the same thing at other sessions.  There are all sorts of issues to be sorted out - highway regulations and insurance are two big ones and in the US.  And these issues will have be figured out on both the national and state by state levels, and probably some cities will want to regulate them, as well.  

What did you learn about autonomous cars at the conference?

I've been skeptical about soon autononmous cars are going to become widespread.  I just saw one this morning saying it would be, "within 5 years".  Well, okay, maybe on certain highways, but not widespread.  It's not because of technology or availability of insurance, but because there are so many regulatory challenges to figure out, at least in North America — the federal government and each state have to implement laws, insurance commissioners in each state have to go through a process.  I don't see it happening on a widescale basis for at least 10 years.

Something that really surprised me, as much as I hate to admit it, is the awareness of carsharing at the conference was pretty low.  We are still more niche to the general public than we realize.  But everyone seems to know about Uber and Lyft and their ultimate plans to switch to autonomous cars.  It wasn't until after the conference I read this really wonderful quote from Gregory Ducongé, CEO of Vulog that would have helped people at the conference understand carsharing, "It's Uber without the driver, and it's much cheaper."

There was one whole session devoted to insuring self driving cars which I found very interesting because it reminded me of my own experiences in the early days of carsharing.   I don't see insurance as the challenge some of the speakers did.  Carsharing pioneers in every country face the challenge of finding an insurance company to provide coverage and AV pioneers will are facing the same thing.  But I think the experience of peer to peer carshare companies suggests that it might actually be easier for autonomous vehicle companies to get insurance because the scale of AVs is so much greater than a little carshare start up, and scale is what insurance companies are looking for to provide a cushion against big claims. It wouldn't surprise me if AV insurance had a pay-by-mile (or kilometer) component, as well!  

In my talk, I reminded everyone that there's no difference between autonomous Uber and autonomous Zipcar - both will provide cars that come to your front door when you request them.  Uber and Lyft clearly have the advantage of a huge member based, but I wonder if Zipcar may have an easier time integrating self driving cars into their business model, since it's built on the idea of owning the fleet, whereas the ride-hailing companies have built their business model on using other peoples' cars.  The challenge for Uber to make the switch is big but hardly insurmountable if you have lots of cash!)

Perhaps the most fundamental insight about the future of autonomous vehicles didn't come from the conference at all but from an article several months ago in Atlantic Magazine's excellent CityLab website.  It said that AVs could lead to either a transportation "heaven" (if the AVs were shared) or "hell" (if privately owned) due to increased congestion and VMT.

Where is carsharing headed?

I've always been reluctant to make predictions beyond 5 years out.  There are so many uncertainties about technology and government policies that could take the industry in a radically different direction. Such changes might be a breakthrough in battery technology for electric vehicles or even the election of a new US President!  So, some things I see likely to happen in the next 5 years include: 
  • The distinction between car rental and carsharing will be blurred even more. Car rental companies on every continent are already offering classic carsharing services - EuropCar, Orix, Enterprise, to name a few.  And car rental companies are increasingly installing telematics in vehicles to enable on-demand rental to provide greater convenience to their customers, allowing them to bypass the checkout counter.  This would allow car rental companies to set up remote unattended lots in less dense areas to facilitate neighborhood rentals.  Just add insurance and refueling and you have carsharing.
  • Car manufacturers — OEMs will continue to expand their offerings in the shared mobility space.  Even without millennials, I think the urban car sales market is already shrinking and shared mobility options will keep growing. These offerings may take the form of traditional carsharing services (like Maven), P2P carsharing (like Tesla's announced model 3 sharing), fractional leasing options (such as offered by Upshift), as well as many experiments with a variety of app-based integrated Mobility as a Service projects (Moovel, Ford, etc.)
  • Technology — I expect OEMs will continue to keep their "connected car" systems proprietary, allowing access only for selected providers, such as their in-house carsharing or fleet leasing companies.  I expect at least one car manufacturer will finally produce a special vehicle model with special options for carsharing fleets, such as allowing the telematics to automatically adjust seats and mirrors to each member's preference.  (At one point Daimler made one model of the Smart for Car2Go with automatic setting of the radio to the last station the member listened to.)
  • New Entrants — OEMs won't be only ones getting into shared mobility.  We've recently seen automobile clubs offering in the one-way services (Evo in Vancouver, Gig in Oakland) and it seems possible that insurance companies and others in the transportation sector may start providing mobility services, such as last mile services to trains.
  • One-way carsharing systems will become the dominant player, serving both round trip and point to point trips. In cities where on-street parking is not too difficult, the same fleet can easily serve both types of trips and it will provide better utilization of the fleet.  In cities with limited on-street parking, companies may do it with separate but overlapping fleets, using some one-way vehicles to satisfy weekend demand.
I'm sure we'll see many other possibilities as the personal transportation sector is in huge ferment right now.

(Note: an earlier version of this interview was published in the May, 2017 edition of the Team Red Global Carsharing Update newsletter.)

Monday, February 13, 2017

I'm Disappointed in You, Car2Go and ReachNow

Please permit this short, but long overdue, rant about what I consider to be a poor decision by one of my favorite carshare companies - Car2Go. (Updated now to direct this rant also at ReachNow, as well.)

It's the "Driver Protection Fee" charged all Car2Go customers in North America.  The "protection" it provides is reducing the insurance deductible from $1,000 to $250, providing a "benefit" to customers whether they want it reduced or not.

The Driver Protection Fee works like this: Your first 90 trips each year have an extra $1 tacked on to the final amount.  After 90 trips the fee goes away until next year.  90 trips is an average of 7 trips per month - 2 trips per week (the kind of customer that any carsharing company would be smart to reward).

But for the rest of us, the vast majority of its customers, it effectively raises the per minute cost.  For example: an 11 minute trip billed at the advertised rate of 41¢ per minute would cost $4.51.  But with the Driver Protection Fee that 41¢ per minute trip actually costs 50¢ per minute.  A 25 minute trip doesn't cost $10.25, it costs $12.50 - 45¢ not 41¢ per minute.

Even worse as far as I'm concerned, on the web site page showing the prices, the Driver Protection Fee isn't even an asterisk next to the rates, but shown on a separate page.

To be fair (thanks to a reminder from Car2Go) ReachNow has something similar - the "Shared Asset Fee".  According to their FAQ the $1 per trip Shared Asset Fee is to cover cleaning of vehicles - something we expect to happen anyway.  At least with Car2Go you get the insurance deductible lowered.  It doesn't go away after even 90 trips as with Car2Go.  Worse, the ReachNow Shared Asset fee is levied only in Seattle and Portland but not Brooklyn.  (Seems hard to believe we're messier than Brooklyn-ites!)

Look, if you want to charge me 50¢ per minute, fine, please do.  I can tell you that 5¢ per minute isn't going to change my decision to use Car2Go if it's a trip I want to take and there's a vehicle close by.  And if you want to give me a discount after my 90th trip, I'll take it.

One of the fundamental principles I tell start ups I'm working with is to keep pricing simple and transparent.  This avoids confusion about what a trip is going to cost and sends a message to customers that your company is being fair and open with them.  Please Car2Go and ReachNow, you can do better.

Wednesday, December 28, 2016

The Year in Carsharing - In Reverse

Here are some highlights of developments in the worldwide carsharing industry during 2016.  They're taken from my Twitter feed @Carsharing_US.  This is a hardly a definitive list of developments in carsharing, only what caught my attention (and you can see that during certain months I was paying attention to other things!)

I think it gives a good sense that carsharing is growing and changing in lots of areas -  Europe much more so than here.   (Which is hardly surprising given the density of cities, quality of public transport and cost of private car ownership in Europe.)  But Zipcar continues to innovate both here and in Europe and one-way carsharing is available in 13 cities in North America.

December
VW announces mobility projects for Rwanda, Africa
Green Commuter launches with 20 EV carsharing fleet for Chatanooga
LA selects Bolloré Bluecar for EV carsharing pilot serving "disadvantaged neighborhoods"
Audi On Demand opens first location in Germany
Citroen launches E Mov casharing in Madrid with Citroen C-Zeros
ReachNow Residential launched in Brooklyn - offers RT carshare to apartments and condos
Vancouver BC has more carsharing members and cars than Portland or Seattle

November
Autolib' Paris is 5 years old
Car2Go closes Minneapolis, cites high taxes as part of the problem
Car2Go ends service in San Diego, after replacing EV fleet with gas earlier in the year
Pincars, carsharing for Richmond, Virginia launched
ReachNow launches in Brooklyn; also offers ReachNow Ride (taxi) and ReachNow Share (rental)
Daimler announces P2P platform Croove, listing all car brands to start in Munich
City Carshare San Francisco sold to Carma, outsources service to Getaround
Nissan announces Get and Go carsharing in Paris for 2017
GM invests in Chinese trip planning start up
Mobility Switzerland one-way carshare Catch A Car opens second city, Geneva

October
Ridehailing now more popular with business travelers than car rental and taxi combined
Toyota announces Smart Key Box technology demo with Getaround
BMW offers EV mobility bundle in Switzerland - train, carshare, bikeshare and i-3 for 1,100 CHF/month
Zipcar offers one-way trips between Baltimore - Washington, DC
GM expands Maven carsharing in San Francisco and other US cities
Ford closes GoDrive pilot project in London
Robin Chase shows how self driving cars could either improve cities or ruin them
Audi At Home offers services to luxury condos in Hong Kong

September
VW announces Moia - mobility brand with carsharing, ride hailing
Italian EV carshares expand to Roma with Twizy and Zoe cars
Citroen invests in CommunAuto
Bolloré launches BlueSG in Singapore
GM Maven offers one way trips between Ann Arbor - Detroit airport
Moscow to have 5 one-way carshare companies
Zipcar passes one million members worldwide
Zipcar offers Zipbike on 15 college campuses
Zipcar launches one-way carshare in Brussels
August
GM announces that Opel will operate Maven carsharing services in Germany 
US study shows that carsharing trips are taxed higher than rental car
July
Tesla Master Plan Part 2 announces a future Tesla Carsharing Network
Mobility announces one-way trips between Zurich and Bern city and airports
Awto - first carshare in Chile launched

June
Zipcar rolls out 100 one-way vehicles in Seattle
Ford discovers no one is interested in their fractional ownership pilot program
Toyota launches Let'sGo carsharing in Dublin, Ireland
Spain announces special parking and HOV lane privileges for carsharing vehicles
Tel Aviv announces $26 million investment for one-way cashiering to go to local Car2Go Israel
Car2Go Chonquing signs up 78,000 members in 2 months (Seattle took 2 years)
50 hydrogen Hyundais join BeeZero carsharing in Munich
Team Red published detailed evaluation of round trip and one way carsharing effects in Munich
EuropeCar acquires BlueMove (Madrid), rebrands as BlueMove Ubeeqo
Lots of speculation about Apple computer car and carsharing turned out to be nothing
Toyota Ha:Mo ("harmonious mobility") demonstration with leaning i-Road vehicles in Grenoble,   France reaches half way point

May
Daimler Car2Go reports € 64 million loss for 2015 (that's an Uber-scale investment in the future!) 
GM expands Maven to Boston, Chicago and Washington DC

March
UK's pioneer City Car Club rebranded as Enterprise Car Share
BMW re-enters the US market with ReachNow in Seattle
Car2Go replaces the all-EV fleet of Smart cars with gasoline after 5 years of hassle
Carsharing drove record profits for Japan's Park24
Vancouver BC exceeds 100,000 carsharing member (sharing 2,100 vehicles)
Car2Go closes Miami citing high costs due to tax rates

February
Sixt says DriveNow grew by 50% in previous year - to 580,000 members and 4,000 cars
Boston Consulting Group predicts worldwide carsharing membership to reach 35 million by 2021
January
GM launches Maven casharing at University of Michigan with 21 vehicles
VW replaces Quicar carsharing in Hanover with Greenwheels brand
Waive Carsharing gives 2 free hours driving in ad-wrapped EVs in Santa Monica, Calif.
EuropeCar launches Matcha Carsharing in London and Paris
CommunAuto (Montreal) and Vrtucar (Ottawa) merge to improve service in eastern Canada.
Ford GoDrive expands to 21 stations at Holiday Inn Express hotels in London
Audi invests $21 million in Silvercar rental service

If you want to see the news story that provides more detail about these headlines, you'll have to go to my Twitter feed, search back to the month.

Did I miss some important developments?  Let me know, via comments below or email me directly.

Saturday, November 05, 2016

Is Milan the World Capital of One Way Carsharing? It Depends...

The phenomenal growth of one-way/round trip carsharing around the world has redefined the carsharing world and I wanted to share some of my thoughts about what's happening the in carshare world right now.

Recently there was talk that Vancouver BC was the carsharing capital of the Pacific Northwest (including Oregon, Washington and British Columbia) with 2,550 carshare vehicles - with 2 round trip and 2 one-way operators. That's certainly impressive and speaks highly of the density and transportation options available to residents to make it easy to go car-lite or all the way to car-free.  There are no P2P carshares in Vancouver (I consider Turo car rental since they don't have technology in the cars but rely on key-swap.)

In Europe, Berlin was the early pioneer in carsharing — home to the pioneer carshare, StattAuto, back in 1987 and now home to 3 free floating services (formerly 4 until the demise of Spotcar) and 5 round trip companies (formerly 6 before the demise of CiteeCar) with about 181 vehicle locations combined (I have not been able to locate recent vehicle counts).  In addition, there are 3 P2P carshares (functionally round trip carshares) with an undetermined number of vehicles and also a Scooter-sharing service with 150 electric two-wheelers.  (It seems strange to me that after all these years none of the roundtrip carshares in Berlin seems to dominate the city — the largest, Flinkster, has 63 locations and the next largest is Greenwheels with 48 stations.)
Image result for car sharing milano     Image result for car sharing milanoImage result for car sharing milano

Now on to Milan - Maybe it's just a coincidence, but in one 24 hour period I saw 3 articles about carsharing in Milan and I was blown away.  Milan is crazy about one-way/free floating with 5 operators:
  • Enjoy - 500 Fiat 500s, operated by ENI, the Italian oil refing company
  • Car2Go - 700 Smart cars, adding 50 Smart ForFours, operating by Daimler
  • Share'NGo - Geely (Chinese) 2 door EVs, majority owned by vehicle make Shandong
  • E-vai - 100 vehicles, most electric; operated by the Lombardy railroad system
  • DriveNow - launched in October, now with 480 vehicles: Mini, Clubman, Cabrio, 1 and 2 series vehicles, operated by BMW.
Image result for car sharing milano
There was another one-way service, Twist, using (electric) VW E-Up!s that shut down last year. (could it be because they put their name in big letters backwards on the hood of each car - so it would appear normal in the rear view mirrors of other drivers - just kidding).  It appears the Milanese not so interested in round trip/station-based with only 1 company - GuidaMi, with about 130 cars, operated by GirACI, a roadside assistance provider in Italy.

Carlo Iacovini, mobility consultant in Milan offers the following reasons for the Milan's adoption of one-way/free floating, "[T]he reason is mainly that free floating is easy and linked to free-style... The
the boom came with free floating, as it’s easy to use and became in one year a lifestyle service. ..
Also consider that Smart and Fiat500 are very popular cars and people loved to ride them in the city… [It] doesn’t matter how good public transport is… it’s more a [question] of flexibility and trend."

Image result for area c milan Part of the appeal is that all carsharing vehicles are allowed to operate without fee within Milan's central city ecozone, Area C. And, a minor attraction may be that several carshares allow one-way pick up and drop off at Milan's Malpensa airport (a 50 minute trip under good conditions).

The City of Milan seems to think there are benefits to one-way/free floating carsharing because they recently announced a tender to attract even more one-way carshare operators - with special encouragement to EVs (too late for Twist)!

All together there are approximately 2,300 carshare vehicles and 300,000 members in Milan.  It's worth noting that while vehicle counts are certainly a useful metric for cities to pay attention to, another useful way to look at the impact of carsharing is the number of vehicles per 1,000 city inhabitants.  To put that in perspective:

Berlin* —  3,000 carshare vehicles, 3.5 million population = 0.85 carshare vehicles per 1,000 people
Milan — 2,300 carshare vehicles, 1.25 million population = 1.84 carshare vehicles per 1,000 people
Vancouver — 2,550 carshare vehicles, 603,000 population = 4.22 carshare vehicles per 1,000 people

(I present this city-carshare comparison somewhat reluctantly. While these numbers are interesting, they're also misleading and a little unfair, since the home areas of the one way carshares in Berlin, which make up the bulk of the carsharing fleet numbers, do not include some major parts of Berlin's population, unlike the service area of carshares in much smaller Vancouver.)

One way to look at cities is comparing the overall mobility.  One recent comparison one is the Shared Mobility Index, which looks at urban density, commuting patterns, whether the city has a sustainability plan, presence of various shared mobility services (carsharing, bikesharing) and average daily parking cost.

Berlin - 69 points overall; 20 out of 30 points for shared mobility
Milan - 65 points; 21 out of 30 points for shared mobility
Vancouver - 60 points; 18 out of 30 points for shared mobility

All 3 cities are pretty pretty good, with no clear differences. What do you think (comment below).  Thanks.

* For what it's worth: As many carshare vehicles as Berlin has, according to the Bundesverband CarSharing Deutschland (PDF), Berlin is actually number 11 in the list of German cities: much lower ratio than Karlsruhe at 2.15 carshare vehicles thousand inhabitants.