Insight

Flexible mobility: 3 reasons why mobility providers need to become more adaptable

Published April 13, 2024

  • CIO & CTO Advisory
  • Travel, Transport & Logistics

The mobility revolution is fundamentally changing mobility as we know it. Nevertheless, one thing remains the same: People continue to be mobile – perhaps for different reasons in the face of new work realities, but mobility remains important. This poses major challenges for the mobility industry: Mobility must be sustainable and flexible, at the same time affordable, personalized, all while being economically viable for providers. To meet this challenge, the mobility industry must become more adaptable. Three reasons stand out as to why it is important to address the adaptability of mobility players now:

Old certainties are crumbling

The world is changing, the environment and markets are becoming more volatile. This has an impact on some fundamental assumptions that we have previously taken for granted. For example, on-time delivery in production and the short-term availability of many everyday goods, but also the continuously increasing demand for mobility. Current crises are calling these certainties into question. Supply bottlenecks, affecting, for example, the production of microchips and other relevant components, have significantly delayed the production of vehicles, including buses, for example. A sure way to throw the plans of transport companies into disarray.

Political and social volatility requires the ability to act fast

Current developments and crises make one thing clear: The world around us can change rapidly. Germany’s introduction of the “9-Euro-Ticket” at short notice in the summer of 2022 changed the fundamental requirements of the mobility world from one day to the next. Just one ticket for all local and regional transport – across all transport companies and associations and, above all, tariff zones throughout Germany.

This was the political response to rising costs for citizens. And the upcoming and similar “Deutschlandticket” is yet another response to this. Just because local and regional transportation has always consisted of a complex tariff landscape does not mean it has to stay that way. But this also means that implementation and innovation cycles are becoming shorter. For all its success on the demand side of things, however, the ticket also made it clear that the companies were not prepared for such a short-term and high-impact change, neither technically nor organizationally or in terms of infrastructure. This resulted in major challenges in technical and organizational implementation, but also on the supply and infrastructure side, as individual congestion hotspots more than clearly demonstrated. Nevertheless, the transport companies mastered the challenge well, particularly on the organizational and technical side. Right on time for the launch, the ticket was available almost flawlessly on all relevant channels. But at what price? Mobility must become more flexible, through adaptable personnel and vehicle capacities, but also through a resilient infrastructure and this flexibility must not push organizations to their limits.

Around 52 million people travelled with the 9-euro ticket from June to August 2022.

Demand is changing – supply must follow suit

Demand is currently changing faster than supply. Travelers are demanding more individuality and flexibility and, in the spirit of the mobility revolution, owning a car must not be the only answer. At the same time, there are always seasonal or situational fluctuations to which mobility providers must respond. This applies not only to scheduled public transport services, but also to sharing or on-demand mobility. All these services should be bookable via digital channels, such as apps. A first important step toward flexible mobility. To be able to increase capacities depending on the situation – for example, through the targeted and temporary deployment of additional shuttles when high demand is expected in public transportation – these offerings must be intelligently integrated with one another. This in turn requires the most accurate possible forecast of expected demand to be able to respond with appropriate capacities.

Three levers for greater adaptability in the mobility industry  

Flexible mobility: Why adaptability is key for mobility providers. There is no question that the challenges facing the industry are enormous. But there are three levers that mobility players can turn to become more flexible and adaptable:

Today, public transport is largely a service based on routes and timetables. The advantage: many people can be transported at the same time and in a space-saving manner. The disadvantage: capacities, times and routes are fixed. On many routes, this makes sense, namely when demand is continuous and can be expected. Today, however, it is difficult to respond to temporary peaks because the infrastructure and often the availability of drivers and vehicles are stretched to the limit. It requires an ecosystem approach to achieve more flexibility here and to adapt existing capacities – both in terms of infrastructure and personnel – as needed and depending on demand. For example, a public transportation network with bus companies or on-demand shuttle providers can respond relatively quickly to dynamic demand and adjust service accordingly – even in the event of disruptions.

Why and how companies need to invest in flexible mobility

Mobility as we know it is fundamentally changing. These profound changes bring enormous challenges for mobility providers. Mastering them requires a high degree of adaptability and flexibility. The changes to which the industry must respond range from uncertainties in global supply chains with the associated supply bottlenecks, to short-term political decisions, to ever more rapidly changing demand on the part of users, who are increasingly demanding flexible and personalized offerings.

To successfully meet these challenges and respond quickly to dynamic demand, mobility providers should address three areas:

  1. Shifting to a flexible offering in association with, for example, bus companies or on-demand shuttle providers.
  2. Developing a data-driven organization as well as a flexible IT infrastructure.
  3. Conversion of the internal organization from linear-hierarchical to process-oriented structures.

Author

  • Dr. Isabella Geis

    Associate Partner – Germany, Frankfurt am Main

    Wavestone

    LinkedIn
  • Sonja Mordmüller

    Senior Manager

    Wavestone

    LinkedIn