Nagging questions about Mobility As A Service (CityMetric)

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Discussed at length in specialist magazines… and increasingly in the popular press, it is transport’s latest buzzphrase. And with promises of a seamless choice of mobility across all modes of transport, in just one place, it is a very tempting offer.

But one nagging question keeps coming up when people keep talking about it. How on Earth will anyone make any money out of it? This is for one very simple fact: it is very difficult to make any money out of transport.

In a time when it is commonly shown that companies are making millions out of transport, this seems hard to fathom. But transport is a high cost industry, with a lot of money tied up in vehicles and infrastructure. Despite the headlines of millions being made by train operators, for instance, their combined profit margin is barely 2.4 per cent. In the bus market, while operating profit margins of near 9 per cent are reported, this hides significant regional variation.

And this is before you consider the ‘loss-leaders’ that are the likes of Uber and other car sharing companies. And now, Mobility As A Service operators want a further slice of that revenue pie.

The challenge to Mobility As A Service is not technology or data. It’s making the whole proposition attractive, not add to costs, and generate revenue. Previously, generating more revenue and more demand involved one or more of the following tactics…

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Written by Long Branch Mike