Mobility Challenges and Opportunities

Mobility is a basic human need. Developed and emerging economies alike require transportation systems to get goods to market and people to the places where they work, shop, dine and gather.

Automobiles have provided personal mobility for more than 100 years. There are currently 1 billion vehicles in the world, and that number is increasing rapidly as individuals in developing markets reach new levels of prosperity; it could reach 4 billion by the middle of this century.

This sounds like good news for an automotive company, and to some extent, it is. But a business model built on private ownership of automobiles comes with inherent challenges, which are related directly to the following current and emerging mega-trends. Taken together, the following trends point to increasingly diverse and fragmented markets for traditional automobile sales. They also point to significant opportunities for companies that are able to respond to mobility needs creatively.

• Urbanization: By 2015, it is projected that at least 35 mega-cities will have a population of more than 10 million. The migration of rural populations to urban areas often outpaces infrastructure development, leading to overcrowded, substandard living conditions and inconvenient, congested transportation systems.
• Built and Digital Infrastructure: More congestion means greater impacts on roadways and other infrastructure, which will require different products and solutions. As transportation and utilities become more interdependent, collaboration must occur among manufacturers, energy/utility companies, and communications and information technology companies.
• Congestion: Each year, traffic congestion is estimated to cost the U.S. $67.6 billion, and the average metropolitan driver endures 27 hours of traffic delays. In many places, especially developing countries, traffic delays are considerably worse, and are increasing at an alarming pace. As more vehicles crowd limited road networks, congestion increases. This, in turn, creates pollution, reduces fuel efficiency and wastes travelers’ time. We’re working on advancing vehicle-to-vehicle and vehicle-to-infrastructure communication systems that will connect cars, allowing them to “talk” to each other and send real-time updates about traffic congestion, road works and other matters that can delay transportation.
• Climate Change: Climate change and associated regulation is leading to new vehicle standards and increased costs. However, the benefits of more stringent vehicle greenhouse gas (GHG) standards are eroded as vehicles spend more and more time idling in gridlock conditions. Other policy measures designed to reduce gridlock, such as congestion taxes and prohibitions on cars entering city limits, may prove to be more effective for reducing GHG emissions from vehicles in urban areas.
• Population: Different regions of the world are experiencing opposing population trends. Among the more developed countries, only the U.S. is growing in population; Europe, Russia and Japan are all shrinking. Regions of Africa and Asia are growing in population and will have large numbers of young people. But by the middle of this century, most of the world will be much older on average. With most people living in urban areas, more and different forms of mobility will be needed to support independent living for seniors, the disabled and young people.
• Social Inequality: The gap between rich and poor creates enormous needs for innovative, affordable mobility solutions that meet human needs and help people build a better way of life. Unequal access to transportation often limits the opportunities available to those most in need. Better mobility is part of the solution to unemployment and income disparities.