Mobility as a Service: how to drive efficiency and enhance customer experience?

Personal mobility is evolving rapidly as customers turn to multimodal solutions across public transport, bicycles, shared vehicles, scooters and more. To meet these preferences, technology and automotive companies are offering integrated Mobility-as-a-Service (MaaS) solutions and developing platforms that allow customers to access and pay for transport based on use.

The 3 keys success factor to thrive is this new market are: connectivity, customer experience and an efficient logistics.

Automotive logistics providers could be well placed to capture MaaS opportunities, including in transport and maintenance. Using connected technology and analytics, providers could also support mobility providers to better serve customers through predictive maintenance and demand planning.

Whether logistics providers make inroads in this market will depend, in part, on their ability to develop offerings between B2B and B2C delivery models. Providers will also need to adapt their IT platforms and interfaces between customers, vehicles, transport and infrastructure providers.

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Changing roles for automotive logistics providers

DID YOU KNOW?

MaaS services market

2017 2030

US $47bn $250bn

EU $25bn $451bn

China $15bn $656bn

Estimated annual demand for Maas in the US - 108bn miles

Service availability by number of car sharing users globally

2017 11,000,000

2025 36,000,000

Source: Frost & Sullivan

Source: Statista

As part of the ongoing quest to create seamless and integrated transport systems, automotive companies are moving beyond existing business models based on the sale and ownership of single vehicles and focusing more attention on the establishment of flexible and customised mobility solutions.

Although the exact nature of such systems tends to vary, such mobility services essentially bundle different types of mobility, whether public transport, car sharing, bike sharing, ride hailing and taxis, and offer them as part of one multimodal solution. With the ability to search, book and pay – often within one dedicated integrated app – MaaS connects people to the best travel option, creating a seamless and flexible travel experience.

There are already opportunities for logistics providers within these growing ecosystems:• carrying out fleet delivery and individual vehicle transports;• vehicle repositioning;• vehicle accessory and technology modifications; • vehicle maintenance and repair; • battery charging or swaps;• facility management.

Logistics and third party providers can also assume more strategic technology and customer service roles, such as IT-based vehicle tracking and software services, or using data for predictive maintenance, as well as to optimise insurance and claims management.

From mass production to MaaS solutions

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“Cars are becoming a separate place for service consumption.

Pascal BRIER,Executive Vice-president,ALTRAN GROUP

UBER

• 2018 revenue – $11.3bn ($1.8bn loss)• Global users: 110M• 600 cities in 65 countries

BMW & Daimler mobility JV

• Car sharing (SHARE NOW), taxi ride-hailing (FREE NOW) , parking (PARK NOW) , charging (CHARGE NOW) , multi-modal (REACH NOW) and charging: 70M users• Ride-hailing: 140% growth 2019 vs 2018• Reach Now (moovel Group): 23% growth in app transactions 2019 vs 2018

ZIP CAR

• > 1M members on-demand access to more than 12,000 vehicles in urban areas and college campuses• Operates in over 500 cities and towns and over 600 college campuses• A fleet of vehicles with over 60 different makes and models• Parent: Avis Budget Group

DID YOU KNOW?

MaaS business modelsMaaS enables private individuals to travel using a variety of transport modes without needing to own the equipment, accessing the nearest available equipment and paying by use.

6 models are identified many of which are not necessarily new, but transformed through technology:

1. Traditional dedicated carriers: where users rent a driven and private service, e.g. a taxi, a private jet. This area has been greatly impacted by ride hailing firms like Uber, with carmakers now also participating i.e. via Volkswagen’s Gett or BMW-Daimler’s Free Now.

2. Traditional shared carriers: where users rent a seat on a shared journey, e.g. on buses, planes or trains.

3. Self-driven open pools: this includes more traditional rental and fleet services for hiring vehicles over a defined period (like Avis or Hertz) or even leasing providers, such as Leaseplan or France’s Arval. It is also includes an expanding range of short-term, on-demand driving and mobility services for short-term hire, such as Zipcar (owned by Avis) Daimler and BMW’s Drive Now, GM’s Maven – and indeed a growing variety of bicycles, e-bikes and scooters available in many cities.

4. Shared private pools: where a private journey is shared with other private indivi duals, such as French carpooling service BlaBlaCar, or versions also offered by Uber and Lyft.

5. Self-driven private pools: where private cars are rented on a short or medium term basis on a peer-to-peer basis (such as Ouicar in France).

6. Mobility platforms: apps that attempt to integrate multiple modes of transport in a single place. Examples include PSA’s Free2Move, BMW-Daimler’s Reach Now, or even Uber, which is increasingly adding new transport modes to ride hailing services, such as scooters and bikes. Large transport providers, such as the French railway’s SNCF or German railways Deutsche Bahn, have also developed more integrated platforms.

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4 types of mobility to addressMaaS business models have to answer and connect 4 types of mobility taking into account multimodal & cross border smooth solutions.

• Micromobility: < 5km• Medium distance: 5 to 15km • Long distance: > 15 km• Very long distance: > 500 km

A MaaS perfect journey

Business models to make profitableMany cities have seen a flood of car, bike and scooter sharing schemes, with a number subsequently failing. Uber is still reporting very high losses. Earlier this year, Ford ended its Chariot shuttle service two-and-half years after acquiring it.

The JV formed between BMW and Daimler’s mobility services – including in areas like car sharing, ride hailing, parking and charging services – suggests how competitive the shared mobility environment is. Accessibility matters, as do customer interfaces. For the two German premium brands, going it alone was no longer viable to compete with tech giants and upstarts. This offers lessons for the automotive logistics industry.

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“Self-driven open pools, shared private pools, Self-driven private pools and Mobility platforms have been progressively disrupting private ownership models by flexing the cost of transport, and improving the convenience of booking and paying.

Rather than investing money on a vehicle that is dormant 95% of the time and incurs costs like parking, insurance and depreciation, users can instead pay the costs of servicing, insuring and fuelling vehicles depending on use.

Emmanuel ARNAUD,Executive Vice President of Sales & Marketing, GEFCO

Bruxelles Station

Order & payment

Station

Paris

MaaS: what are the impacts into the supply chain?Mass industrial production and wholesale vehicle distribution business models have dominated the automotive industry for a century. Will a shift in transport preference to ‘per use’ have serious impacts on the volume of vehicles across the supply chain?

Mobility change the vehicle complexity

Some brands offering shared vehicle and subscription-based models, such as Lynk & Co, have also simplified colour and trim options. If the market were to shift in this direction, there would be revenue and margin loss across dealers, suppliers and logistics companies. The efficiency and customer gains of a simplified order to delivery process, however, could outweigh such impacts. Customers’ vehicle choices for a vehicle type can be managed through technology, supported by data on use and preferences – data that will help support a supply chain more honed to real-time demand.

Mobility platforms blur the lines over who an automotive logistics provider’s customer might be.

Whilst many today work directly for manufacturers in B2B logistics models, servicing a mobility platform could involve the integration of fleet owners, local transport carriers or repairers. Logistics providers must be able to ensure such services, much of which entails more B2C, direct delivery and service provision. Importantly, they will require the technology to manage it.

Within this developing ecosystem, logistics will be a key performance leverage. New logistics models have to design new “phygital” solutions including new IT interfaces and offering more on demand services: vehicle transport, logistics, maintenance and refurbishment through digital platforms.

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MAAS IS A SECONDARY TRANSPORT OPTION FOR MANY CUSTOMERS, AND THUS REPRESENTS INCREMENTAL GROWTH IN THE AUTOMOTIVE INDUSTRY.

“The multi-brand, multi-channel aspects of mobility services are already well suited to the networks of hubs and processing centres that third party automotive logistics providers already operate.

The move from car ownership to mobility-as-a-service is not a threat to the automotive industry and supply chain, but rather a disruptive scenario which will lead to positive change and growth.

Emmanuel ARNAUD,Executive Vice President of Sales & Marketing, GEFCO

DID YOU KNOW?

84%In 2025, Ride Hailing will represent 84% of market share in global new mobility services

Source: Statista

A common promise: a seamless customer experience

Reach Now: Multimodal platforms that integrate various mobility servicesIt aims to offer users the opportunity to manage various mobility services across transport operators in a single city. Its mobility app enables users to search, book and pay for transport, as well as to plan trips, obtain information about the next arrival time for vehicles, and organise the integration of travel across multiple transport modes. Another service is its on-demand app, described as a platform for smart cities featuring smart routing and pooling to create efficient solutions for both passengers and transport operators. The company claims this app can be incorporated seamlessly into existing local transport services, making it a valuable tool in the ongoing development and expansion of any transport network.

Free2Move - Groupe PSA’s: providing the most convenient mobility services, anywhere, anytime, for both end customers and corporate customers at global level. The app is brand neutral and marked a return for PSA Group in the US, where it current-ly does not sell any of its vehicle brands. According to the company, the app has around 1m users worldwide. It aims to integrate multiple transport modes and car sharing apps together in more than 30 cities in Europe and the US.

Such platforms need state of the art logistics to handle operational tasks including vehicle relocation and positioning, battery charging and vehicle repair or transport, storage and maintenance operations to deliver a seamless customer experience.

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“The combination of different car-based services in one app allows Reach Now to offer broader MaaS solutions.

If we combine these services (which include trip planning, payment and public transport integration), we can really have a big impact, while making it more convenient for people to get around and have more liveable cities.

Spokesperson,REACH NOW

Millenial car ownerships (US) account for 30% of annual car sales

Millenials Generation X Baby boomers

5

58.6

36.4

4.5

62.8

32.7

7

73

20

Lease Ownership Car financial plan

%

DID YOU KNOW?

Source: InsuranceQuotes.com

New logistics models to inventSome brands are going deeper into the car share model by offering customers the opportunity to access or ‘subscribe’ to vehicles brands including Mercedes-Benz, Cadillac, Porsche, Volvo Cars and BMW have all been trialling vehicle subscriptions in the US or Europe, in which customers pay a monthly fee and can then access a range of models across the brand’s fleet.

Logistics to ensure a seamless Customer eXperience

For logistics, it is a service that requires vehicle location, tracking, exchange and maintenance between dealer or storage locations, and customers.

Thus far such services have been niche and relatively low scale. One brand setting out to change that is Lynk & Co – a joint venture between Geely and its Volvo Cars subsidiary. It has already launched in China and is planning sales in Europe in 2020.

Lynk & Co was launched, in part, with the intention of offering mobility and car-sharing solutions. Its chief executive officer, Alain Visser, has said that the company’s retail model in Europe will be primarily focused on a subscription and contract model, like Netflix. Individual pricing for models will be less relevant.

As well as subscribing to cars, users will also be able to rent their cars for short periods by activating a shared transport mode, allowing them to earn money as well.

According to Dzenan Karic, Head of Public Relations at Lynk & Co, the company recognises clear trends amongst millennials of a switch away from direct ownership, of which car ownership is just one aspect. «The idea is that young people today do not care so much about ownership, they want access to mobility. To get from one place to the next, instantly, simply, without pressures,» he says.

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“We are catering for an audience that doesn’t care about how fast a car can go, or specific colours.

They want simple, quick, easy access to mobility. So taking away a vehicle for maintenance will likely have no negative effect on the owner and is another example of the easy offering we want to give users.

Dzenan KARIC,Head of Public Relations,LYNK & CO

China Europe USA

DID YOU KNOW?

Source: Statista

Maintenance and more without lifting a finger

A car that previously had two or three ownership cycles, each lasting several years – such as from a leasing company to second-hand owners – will now change drivers up to every three hours. That could mean more maintenance and aftermarket require-ments, as well as a quicker turnover of vehicle fleets.

Direct-to-consumer maintenance and service could become a commodity

• Lynk & Co owners will be notified in advance that their car when their car is due for maintenance - and they «needn’t lift a finger», says Dzenan Karic.

• Operatives will retrieve the car at the owner’s convenience and carry out maintenance overnight, or at another time when it is less frequently used and replace it with a temporary solution while the owner’s designated car is being repaired, maintained or replaced.

In case of accident, insurance companies and other actors are already also rethinking the services of swap, expertise and repair to enhance their customer experience.

We can imagine that the player who made the SWAP make the evaluation on the pickup site and send it to the insurance companies - if the quotation is accepted and the repair shop selected, spare parts are ordered automatically.

For logistics operators, it will be a mater of ensuring a fluidity and an acceleration of the flow of information and validation and a matter of synchronising them with the physical flows. The objectives are to delight the customer experience and to provide cost and green efficiency.

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“Look at films, a generation who kept videos or DVDs now casts them aside in one fell swoop thanks to Netflix; hailing a cab from the side of the street, gone with Uber; even car ownership, gone are the days of purchasing or owning a car outright with cash, finance options are the norm with new car sales; and dare we start to talk about scooters and bikes which are fast-growing in city centres?

Dzenan KARIC,Head of Public Relations,LYNK & CO

Mobility services market size in 2030

US $656bn

US $451bn

US $250bn

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WHAT ARE THE TECHNOLOGY DRIVERS OF THE AUTOMOTIVE REVOLUTION?

First, connected technology and 5G will support “self-diagnosis” for repairs. Furthermore, connectivity and artificial intelligence in vehicles will continue to improve customers’ mobility experience, from business and scheduling planning, to e-commerce and health. Each of these could represent areas of potential for logistics providers. The key to succeeding in that motion is to be able to tackle these changes with the most open and connected supply environment. Immediacy and 100% transparent service availability will be key success in a world of customer ‘frequency’ over ‘distance’ will require new product broadcasts and much more digital and connected channels.

IS THE B2B AND B2C SEGMENTATION STILL VALUABLE?

MaaS will certainly become a more ‘real’ component of our life experience, offering more than simple mobility –like entertainment – alongside travel. Already, for example, a growing number of car brands are offering solutions that allow for direct delivery of products to vehicles. In the US, Volvo Cars has partnered with Amazon to allow direct deliveries to the boot of the car via an app. As MaaS evolves, the notion of B2B and B2C logistics would become much thinner, leading to a ‘B2B2C notion of service’. In recognition of this fact, GEFCO has launched a new offer Moveecar dedicated to this logistics. Moveecar embraces the implementation of a scalable and evolutionary internet-based IT platform connecting every actor supporting the future MaaS platform providing phygital logistics services.

WHAT ARE THE SERVICES PROVIDED BY MOVEECAR?

Moveecar provides car-related services in six key functional areas, dubbed STAART (storage, transport, appraisal, administrative, refurbishment, travel). Moveecar STAART services include: • two traditional LSP functions, Storage (between 2owners) and Transport (relating to relocation betweentwo owners today, and potentially between 2 users inthe future);• three areas focused on enabling the maximalavailability of mobility devices, such as cars orscooters, as a service: Appraisal, Administrative,Refurbishment and Maintenance services;• one area oriented towards supporting the Travelexperience.

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Digital logistics platforms - making a STAART!

Emmanuel ARNAUD,Executive Vice President of Sales & Marketing, GEFCO

GEFCO’s duty has always been to connect people through.“While logistics providers like GEFCO are unlikely to become MaaS providers directly, there is a growing role for third party services. In parallel, the technology requirements and capabilities of vehicles will change the scope of logistics services to the automotive industry. Emmanuel Arnaud explain how GEFCO support this transformation.

3 questions for:

A multi-customer, multi-channel logistics

«Beyond the digital availability of MaaS, there is also a physical reality on the pavement and on the road that LSPs are used to facing. So culturally and operationally companies like GEFCO are ‘equipped’ to face this type of challenge,» says Emmanuel Arnaud.

Shared user networks for vehicle logistics, especially in Europe, are well suited to handle increases in online distribution. In an interview with Automotive Logistics, Tim Lawrence, the head of supply chain for PA Consulting, said that while American dealerships keep large vehicle stocks on premise, in Europe and other markets OEMs hold inventory in national or regional hubs, where they also carry out pre-delivery inspection and preparation. Such networks would be able to handle direct deliveries. “In terms of the main physical logistics locations, there won’t be much change as you move to an online model,” he told Automotive Logistics. “You may have customer pickup points, rather than the dealer itself. But most likely there will be delivery to the home.”

On-demand vehicle providers such as Zipcar use similar networks. In an interview with Automotive Logistics, its senior marketing manager, Garry Thornton, revealed that it delivers vehicles for the UK into PDI (Pre-Delivery Inspection) centres near ports, where dedicated Zipcar teams prepare them and install proprietary access technology.

For LSPs, the jump from handling larger fleets of vehicles, to serving individual or smaller flows more nimbly, will require new skills and technology. That is why Emmanuel Arnaud reiterates the need GEFCO to “redesign its interfaces” as part of ongoing efforts to be more B2C connected – a challenge it intends to tackle with its Moveecar offer.

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In the future, the development of new ways of consuming mobility will probably imply a change in GEFCO’s revenue stream, replacing the ‘distance’ factor with the ‘frequency’ factor – in essence meaning that, although a car will travel less far between two owners, it will travel more frequently between two users.

Emmanuel ARNAUD,Executive Vice President of Sales & Marketing, GEFCO

In terms of the main physical logistics locations, there won’t be much change as you move to an online model.

You may have customer pickup points, rather than the dealer itself. But most likely there will be delivery to the home.

Tim LAWRENCE,Head of Supply Chain Group,PA & CONSULTING

For automotive logistics providers, the challenge ahead in evolving and profiting from Mobility-as-a-Service solutions will be both cultural and technological. While serving the supply chains of major OEMs for production and distribution is high volume and highly complex, moving closer to urban mobility customers across the mobility value chain will require new, more flexible interfaces, IT and data management skills. It will also require orientating more towards final consumers, as well as a wide variety of transport and infrastructure providers.

Just as MaaS promises to put private transport assets to full use, logistics providers’ own transport asset and service utilisation should also increase with the opportunity to serve both cargo and consumer-related transport needs – which could help both increase revenue and decrease emissions and waste.

«We believe that, to some extent, the mobility of people and the mobility of cargo will become more and more congruent in the future,» says Emmanuel Arnaud. «In this case, full supply chain LSPs may also see an opportunity to leverage the MaaS concept in order to maximize usage of transport means in cities and optimize and decrease empty runs, minimising the emissions footprint of mobility.»

Conclusion: more customersbetter utilisation

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GEFCO, Partners, unlimited.

At GEFCO, we are convinced that long-term cooperation is the key to shared growth with our partners. Thanks to our strong expertise and heritage in the automotive sector, we design innovative and flexible solutions to meet the most complex challenges of the supply chain.

GEFCO is the world leader in complex supply-chain solutions and the European leader in automotive logistics. Building on 70 years of expertise and a 15,000-strong workforce, GEFCO designs smart, flexible solutions to meet the most complex supply chain challenges in all industry sectors. Present in 47 countries, with a strong global network of partners, GEFCO serves 300 destinations worldwide. In 2018, the Group generated revenues of €4.6 billion.