TODAY’S STUDY: The Value Of Transportation Electrification
Redefining Mobility Services in Cities; The Impacts of Making Transport Clean, Shared, Automated, and Connected
Jan Cihlar, Lisa Jerram, Sam Abuelsamid, Scott Shepard, John Gartner, Rob Winkel, November 2017 (Navigant Research)
The Push for Clean, Traffic Jam-Free Cities
Around the world, major cities have been setting targets to combat the negative effects of local transport on public health, local pollution, noise levels, and greenhouse gas (GHG) emissions. Often, restricting or completely banning passenger cars from extensive areas of cities is seen as the solution to those issues and as a way to reduce traffic congestion and associated demand for limited space in urban areas (e.g., parking). Sustainable mobility plans that take this approach are counting on heavy investments in public transportation and biking infrastructure to compensate for the loss of personal vehicle mobility options.
But what if personal light duty vehicles (LDVs) in cities could be made compatible with the future sustainable mobility system in a different form? Focusing on three key trends in personal mobility—vehicle automation, the push for cleaner powertrains, and the mobility as a service (MaaS) model—this white paper explores their combined prospective effects on the urban environment. Navigant Research finds that, in a MaaS model, battery or fuel cell powered automated vehicles can provide benefits in GHG and air pollutants reduction, reclaimed land value, and reduced energy consumption for transport.
The Coming Age of Automated Vehicles
Driving automation is already a reality in many industrial vehicle applications, and partial automation is becoming commonplace in all road vehicle classes. However, many governments feel unprepared for the operation of large numbers of vehicle fleets on public roads without people behind the wheel. New infrastructure investments, communication network upgrades, the need for fleets to operate in varied conditions, and concerns about cybersecurity are often cited as primary reasons for government concern.
In the early deployment of fully automated vehicles, a driver will still need to be present to monitor vehicle status and deal with the more complex traffic situations. That period could last 5-10 years in challenging environments. Nevertheless, according to Navigant Research’s recent report Automated Driving Vehicles, markets are inexorably heading toward highly automated driving—which is expected to debut by 2020 and start to grow rapidly as soon as 2025.
The question is whether cities are heading toward a future where small, on-demand, cheap car fleets are used as complementary options in city transport or for a major overhaul where nearly every trip is executed by a personal, automated driver. Economics, convenience, and safety will drive the shift toward on-demand automated vehicle services. If managed properly and coordinated as part of a multimodal transportation ecosystem, this shift could lead to reduced traffic congestion in cities, lowered demand for parking spaces, and beneficial energy and environmental impacts.
Redefining Urban Transformation
To highlight how this mobility transition will redefine the urban transportation environment, this white paper lays out a high adoption scenario of automated vehicles into the total fleet in a model city with 3 million inhabitants who collectively own 1.5 million personal vehicles. Due to the synergistic effect between driving automation, connectivity, the MaaS model, and the switch to cleaner powertrains, significant improvements can be achieved in a number of areas of concern to city governments and citizens. Figure 1.1 highlights Navigant Research’s analysis on the model city.
A Bright Future Is Not Inevitable
In light of its prospective positive impacts, the future of automated vehicles appears bright. However, to reach their potential, it will be crucial that automated vehicle fleets are operated as part of a multimodal ecosystem and integrated with public transport options. Together, these provide a spectrum of mobility solutions accessible to all regardless of economic status or location.
Moreover, to fully capitalize on the promised benefits, municipal governments must play a role in the mobility system design. Questions remain in regard to the development of support infrastructure (e.g., charging stations for electric automated vehicles) and there are outstanding legal and ethical hurdles. To make this revolution possible, concerns must be addressed by key stakeholder groups. Navigant Research provides recommendations for each of these groups…
Recommendations For Key Stakeholders
The mobility service revolution in cities will have crucial implications for three key stakeholder groups. Before it takes place though, several issues need to be addressed. Navigant Research has developed a set of recommendations for each of the key stakeholder groups.
City planners and regulators:
‐ Establish legislative and ethical rules enabling operationalization of automated vehicles and MaaS in the city.
‐ Quantify the potential contribution to the city’s goals regarding local pollution, traffic management, and climate impact.
‐ Investigate the implications on public transport by focusing on behavioral aspects of city dwellers.
‐ Incentivize use of shared automated vehicle mobility fleets over personal vehicles and integrate them with mass transit to achieve optimal societal benefits. Aim to create multimodality systems.
‐ Quantify the potential impact on public areas and potential economic gains (e.g., by selling depaved areas to private entities).
‐ Investigate the infrastructure and spatial planning needs for charging and/or hydrogen refueling stations.
‐ Collaborate with mobility providers to ensure that services deployed meet the unique challenges of each city and its residents. Cities with large numbers of low income residents or lower population density (such as Detroit) have different challenges to address than somewhere as dense as Beijing or Mumbai, or even San Francisco.
‐ Hold MaaS providers, manufacturers, and communications responsible for cybersecurity and resilience at all levels from the vehicle to the edge to the cloud. Exploits of vulnerabilities could put many lives at risk and discourage residents from adopting automated mobility services.
• Car manufacturers and mobility companies:
‐ Determine which cities are best suited to be first adopters based on factors like engagement of city stakeholders with innovative and smart mobility options or city design and geographic characteristics.
‐ Examine the disruptive shifts in the value chain revenue model. Identify areas of strategic focus.
‐ Define (new) customer groups and their demand patterns, consider expansion to provide new services (e.g., insourced vehicle maintenance).
‐ Develop powertrain of the future strategy by combining the knowledge on cost developments and city goals in regard to environmental impacts.
‐ Develop a range of services and vehicle types to meet the differing needs of cities based on population density, climate, and demographics.
‐ Put safety and security above all else. If consumers are not confident in the reliability and security of automated systems, they may resist adoption.
• Utilities and energy companies:
‐ Quantify the demand shift for different energy carriers and investigate the impact on current energy infrastructure.
‐ Investigate the risk of asset stranding; i.e., will the infrastructure required for the early adopters still be needed in the high adoption phase?
‐ Collaborate with regulators and the transport value chain on infrastructure development in the cities. Identify the first movers proactively.
‐ Examine the plausibility of hydrogen as a transport fuel. What are the enabling conditions that would make hydrogen competitive with electrical transport?
The building blocks for automated driving systems are available, and Navigant Research forecasts that highly automated vehicles should be ready to deploy in volume by 2025. At the same time, various players from both inside and outside of the transportation sector are active in the development of the MaaS model. More likely, these on-demand automated services will be operating vehicle fleets with electric and/or hydrogen powertrains due to both regulatory and market pressures. These trends combined—fitting well with the principles of sharing and circular economy—have the potential to bring truly positive economic, environmental, and social impacts, all examined in this report. There are barriers present that might slow down the development, most notably infrastructural, legal, and ethical ones, but none of these seem prohibitive for the expected rollout of automated vehicle fleets.
Key to unleashing this mobility revolution in a positive direction will be a collaborative management from a number of stakeholders (city planners and regulators, transportation companies, utilities, and energy companies). The future of city transport must be a multimodality ecosystem with public transport options integrated with automated vehicle fleets, which together provide a spectrum of mobility solutions accessible to all regardless of economic status or location.
Its effects will spread unequally on different service providers. However, strategic positioning of the affected players can open up additional revenue streams (e.g., system orchestration) for some or limit the damage done to others (e.g., oil companies diversifying to green hydrogen production, or car rental companies providing maintenance and support to automated vehicle fleets not operated by OEMs).
More investigation and analysis, in particular regarding the points listed in Section 5, are crucial in order to fully understand and adequately prepare for the future of transportation in cities.