Will shared mobility become a problem for vehicle manufacturers?

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This article was written and published in Spanish and has been translated into English via Google Translate. Click here to read the original article.

The future imposes shared mobility solutions in large cities, this trend seems to be clear, especially since public institutions are supporting the companies that provide these services, but are manufacturers ready to lower vehicle sales to a number of users that do not consider it necessary to own a vehicle grows?

In large cities, there is a growing number of people who, despite having a vehicle, do not use it during the week, because of parking issues, pollution, etc., and prefer to use carpooling services. Leading one to wonder if the time of car sales stagnating and the declining is near.

Since the cars were launched on the market, the manufacturers have had in their favor the general desire to own a vehicle and that the owner use it exclusively. However, these trends, although still in force, already have their counterpoint in the “shared use”, vehicles in which the trip is shared with the driver, or that are part of fleets and are used without their own, so that the question that we ask seems timely.

Manufacturers need to reinvent themselves. Regarding technology, we are already seeing it through the various agreements that have been signed with technology companies, the development of new R&D & i lines to diversify the energy that drives vehicles, from investment in shared mobility companies or the creation of own fleets for shared use.

Shared mobility, a business issue

This was indicated by the American Bloomberg recently. Mercedes-Benz Daimler AG bought a stake in CleverShuttle, after it started operating in 2016 in Germany. It offers a service through an app, something similar to Uber, that matches people looking for a trip with other passengers in the same neighborhood. In the five German cities where it operates at the moment, it already has more than 650,000 users.

According to Munich-based consulting firm Berylls Strategy Advisors, in just over five years those services will eat up car sales, leaving carmakers vulnerable if they can not find ways to increase their revenues. By the year 2030, in the United States, Berylls predicts that total car sales, both individually owned and shared, will fall by almost 12 percent.

The problem is that the issue is not as simple as replacing car sales with revenues from mobility services. Large German manufacturers such as Daimler, BMW AG, and Volkswagen AG have invested hundreds of millions of euros in shared services and are far from making a profit.

As an example, according to Bloomberg, BMW’s carsharing service, DriveNow, which started in 2011 and operates in 13 European cities. After seven years, it is still suffering losses and last year accounted for only 0.07 percent of the company’s sales. The rest came mainly from the sale of almost 2.5 million vehicles.

This article was written and published in Spanish and has been translated into English via Google Translate. Click here to read the original article.

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Simon Baker is the Founder and Executive Chairman of Online Marketplaces and Property Portal Watch. Involved with property portals for 15 years, he’s a well-recognized expert and industry consultant.
As former CEO/MD of the REA Group for 8 years, Simon led the group to its current market-leading position. When he joined REA Group in 2001, it had $4m in revenues, $6m in losses and an $8m market cap.
By 2008, the company presided over $155m in revenues, $35m in EBITDA and enjoyed a peak market cap of $1b. Simon is currently Chairman of the Mitula Group and Real Estate Investar and a serial portal founder and, investor.