Accelerate

Solutions&Co encourages meetings and exchanges between the leaders of innovative solutions and larger-scale companies, with the aim of creating synergies and strengthening the impact of these positive initiatives.

Robin Bonsey

Robin
Bonsey

Consultant, HYSTRA

Robin Bonsey

Mobility in developing cities

The strong demand for mobility in developing cities must be met with inclusive and sustainable solutions

Demand for mobility is growing strongly in emerging countries, nearly twice as rapidly as their GDP. In the next 40 years, passenger transportation in non-OECD countries is expected to grow by a factor of four, and freight transportation by a factor of six. Simultaneously, rapid urbanisation means most of that demand will appear in cities.

However the pressure that the growth of traditional transportation solutions lays on infrastructure, as well as their environmental consequences, are clearly unsustainable: a car in Bangkok already spends 1,100 hours a year stuck in traffic; yet more than 300 new vehicles are added to the flow every single day. The individual car ownership model cannot be sustainably replicated in the already vast and rapidly growing cities of the developing world. It must be replaced by pooling or sharing individual transportation solutions, and improving collective transportation solutions. Mobility must also become more socially inclusive: lack of mobility is both a factor and a consequence of poverty, as low-income classes are both too poor to access efficient transportation means, and impoverished by their lack of access to jobs or markets.

 

  • A wealth of innovative solutions are emerging locally

In response to these needs, a proliferation of innovative solutions has appeared all over the world, not least in the cities of emerging economies.

A large part of these innovations has focused on improving the performance and efficiency of existing transportation through digital tools. App-based innovations in dispatch services that met with tremendous success in developed markets (e.g. Uber) have been transposed to developing countries, with considerable benefits for both customers and drivers. In India in the last few years, start-ups such as mGaadi, Autowale or Jugnoo transposed the Uber application model to bring efficiency and convenience to the chaotic three-wheeled world of auto-rickshaws, offering reliable rides with transparent pricing. This also represented a considerable social impact by allowing low-income rickshaw drivers to significantly improve their livelihoods.

Technology-based ventures have also been helping cities shift to less polluting or more economical modes of transportation. Global Electric Transport is a Filipino-American social enterprise in Manila, set up to replace the polluting and cramped Jeepneys, which are the main public transport vehicle in the Philippines. GET has developed a business model that will allow to transition from Jeepneys to clean and comfortable electric COMET vehicles, while offering enhanced opportunities for Jeepney drivers and owners, and keeping prices stable for end-users. GET has launched its first route in Manila and is hoping to replace some 20,000 of the 60,000 Manila Jeepneys by 2020.

Lastly, new enterprises enable consumers to avoid the need for mobility altogether, by bringing products and services closer to them. This is best done by leveraging existing infrastructure: for instance, the small retail corner shops (“mom and pop shops”) that are ubiquitous in many developing cities. Several organisations have successfully equipped such shops with tablets providing low-cost telecommunications, financial transactions, and other services to their consumers. In the poor districts of Mexico City, companies like Barared and Virtual Market have enabled entire neighbourhoods to place long-distance calls, withdraw cash, or pay their utility bills around their block, without having to travel to the city centre and queue for hours in front of crowded phone booths, ATMs or utility offices.

 

  • Incumbents need to step in and help them reach scale

Like in any field, most innovations in mobility have emerged from small, flexible and disruptive players. Most are still local and have not yet scaled up country-wide or internationally, for lack of financial and technical resources. The incumbent mobility providers (i.e. energy providers, equipment manufacturers, and network operators) that today provide the vast majority of mobility services also control the assets and master the processes which would allow such innovations to reach scale: but they have so far been slow in harnessing them. However, traditional competitive borders are shifting as these mobility incumbents are becoming increasingly threatened by more agile new entrants (e.g. IT firms such as Google developing driver-less cars). Tapping into the wealth of innovation happening on the ground, and scaling up efficient, clean and inclusive mobility solutions would certainly help incumbent players stay ahead of the curve.

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