Automotive > Connected Mobility Blog

Denial Won't Save the Mobility Sector

by Roger Lanctot | May 22, 2020

The once-vaunted mobility sector is in the toilet. Ride hailing demand has plunged as much as 80% around the world - with the possible exception of markets in recovery (like China) or that have re-opened (like Sweden, Israel, and others). Car sharing demand has dropped off the table with General Motors (Maven) and Penske Motors (Dash) terminating operations. And scooters scooted away, only just beginning to ease back onto the transportation scene as city centers stir once again.

While Mobileye President and Chief Executive Officer Amnon Shashua said last week "The memory of COVID-19 will fade quicker than we think," the reality is that it will be quite some time before we can shake the specter of COVID-19 from our collective consciousness. And until there is a vaccine or a treatment, we will be living with the risk that it represents and that risk will color our transportation decision making.

In this context, mobility operators are going to have to step up their game if they hope to return to the parabolic growth trajectories of 2019. Last week, Uber announced its plan to restore confidence in its ride hailing service by requiring its drivers and passengers to wear masks and to wash their hands - going so far as to assert that the company had allocated $50M for the acquisition and distribution of personal protective equipment for drivers around the world.

Uber COVID-19 recovery plan:

At the same time, a bizarre report appeared in multiple news outlets asserting that car sharing operators - namely Turo, Getaround, and Zipcar - antipated huge gains as consumers shift from public transportation to the purportedly cleaner cars available from networked or peer-to-peer car sharing services.

Car sharing as a cleaner alterative:

I want to be crystal clear in bursting the bubbles of these fantacists insisting that they have solved the COVID-19 problem. Ride hailing operators will continue to struggle and fail until they offer vehicles equipped with partitions to protect drivers and passengers from the free passage of air between the driver seat and the passenger compartment.

Uber is sorely mistaken if it thinks hand sanitizer and masks are going to cure its multi-billion-dollar revenue freefall. It won't. To restore consumer confidence, the company must install partitions and, in fact, I'd argue that regulators should insist on this measure as well.

Notably DiDi Chuxing in China and Alto operating in Dallas and Fort Worth, Tex., have both seen fit to install partitions - just like the good old days when taxis were the only option and partitions were required. Partitions were a good idea then. They are an even better idea now. Get the partitions or kiss your billions good-bye - and that goes for Lyft, Gett, Yandex, Ola, Grab, Gojek, and all the rest. In fact, I expect to see a new round of ride-hailing startups with permanent partitions to join the competitive fray and put a hurt on the "un-partitioned."

As for car sharing operators, no one wants to share anything any more. To keep the sharing momentum moving, car sharing companies will not only need to ensure their vehicles are cleaned between rides - they will need to certify that cleansing by applying some form of seal to vehicle doors to warranty that some form of sanitizing has occurred. Yes, just like the toilet seat in your hotel room - you remember hotel rooms, right?

Halfway, half-hearted efforts such as Uber's amount to putting a band-aid on a severed limb. The mobility sector is on life support. Urgent, high profile, no-nonsense, extraordinary measures are needed or the patient will die. And if legacy ride hailing and car sharing players can't muster the investment or innovation - a new raft of startups will step in to deliver what the public demands. Why will those startups start up to do this? Because there is profit to be had in mobility but in a post-COVID world that profit will go to the most ethical and customer-centric operators.

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