Michal Nakashimada, Head of New Modes, is one of the leading voices in the emerging mobility space. In addition to his role ensuring that the Ride Report suite of tools works for many forms of mobility, he writes the Movements newsletter, a roundup of stories about the mobility industry, focusing on mobility software, cities, and infrastructure.
He recently shared his thoughts on the state of the mobility industry in 2021. He had so many valuable insights to share that we’re dividing this Q&A into two parts. Here’s Part 1.
How do you define new mobility?
New mobility is any transportation mode or service that can be substituted for what we use cars for, and it usually has an innovative business model and is enabled by software.
I’ll elaborate by talking about how we’ve historically thought about transportation as a consumer, at least here in the US. What do we hire for the job of getting us from A to B? A lot of people traditionally think of mobility as having a car or maybe walking or taking public transit in bigger cities. In general, we think of transportation as a singular mode to get us from A to B. And then, in the past 10 years, mobile phones, the internet, and software have opened the door to this broader concept of what we call new mobility, which leverages these technologies to create new business models around transportation. Think Uber, Car2go, and Bird.
Instead of buying a car and using it for every trip, you can now take an Uber to the airport, a bike to lunch, or a carshare to a weekend getaway. Different modes for different transportation jobs to be done. Yes, we have had taxis, carshare, and bikeshare for decades, but technology-enabled wider distribution and new experiences for all of these ways of getting around.
With that definition of new mobility, I think of food and grocery delivery as new mobility, because it replaces trips you would have taken with a car.
How has new mobility evolved this year? How much of that has been because of the pandemic?
On the consumer level, the experience is basically the same. We haven't really seen any new form factors or types of mobility, but a lot of iteration on the current models. Changes are mostly behind the scenes with new mobility companies like Bird or Lime or Uber having to cut costs and stretch their dollars and invest in making their businesses more sustainable for the long term.
The pandemic is forcing these companies to be resilient to systemic and macroeconomic changes. Companies continue to improve the business models, experimenting with pricing changes like moving pricing up and down based on demand in a city or a market. We’re also seeing companies try out monthly rentals and monthly subscription plans rather than just by-the-minute rentals.
The e-bike market is still growing rapidly because of the pandemic. A lot of shared micromobility services have been free marketing for e-bike and scooters for personal use. City streets are like the showroom for people to go try out a scooter or bike. And then users think, “Oh, this is really cool.” And they realize they can buy their own. So you're seeing the private consumer demand keep growing and growing as well. You see company’s like Bird invest in consumer bike and scooter models through retail channels. .
The other kind of trend to watch is on the business-to-business side with companies like Amazon, DHL, UPS, or any kind of fleet carriers that take packages around. A lot of them are adopting electric vehicles for their cargo vans and trucks, and then also experimenting with other mode types, like cargo e-bikes and smaller form factors that can get around traffic more quickly in a city to enable more quick delivery.
What trends are you seeing that you're most excited about?
I think one really interesting trend for me is the concept of ultra-fast, 15 minutes or less delivery. There are startups being funded recently like Gorillas, Fridge No More, and Jokr. They’re grocery stores within an app. And you can order like 30 items, they pick out the items within five minutes and deliver them on an e-bike to you within 15 minutes. These companies lease real estate all over the city and create micro fulfillment centers, about the size of a 7-11, that are off the streets. They’re stocked with thousands of products based on the data they get. The enabling technology here is the e-bike, which allows couriers to cover a delivery radius within minutes. The e-bike tailwind is really going to enable a lot of new businesses and services we haven't even imagined.
Another trend I see anecdotally and in the data as well is that e-bikes are growing in adoption and popularity in smaller cities and towns. They're a fun way to get around town and they give people exercise, especially older retirees and senior citizens, and it enables them to get around quicker without exerting the same effort as they would on a normal pedal bike. I think it's cool to see these smaller places adopt bike lanes and things like that. It’s an exciting way to get new transportation options into smaller towns and cities that have predominantly been car-centric.
What are some of the biggest challenges you have seen around new mobility?
The supply chain by far; there's so much demand in the market just for consumer goods in general, and then especially for bikes. From my understanding, there are around five major component makers for bikes and they're all oversubscribed. Orders are backed out for at least a year for different parts of bikes.
There’s also the demand for batteries — lithium-ion cells — which is through the roof with electric vehicles, e-bikes, power tools, everything that uses batteries; everything's using batteries nowadays. And then semiconductors, which is a big one where it's actually so bad that cars don't have appropriate chips to power the car.
Ford is closing down production lines just because there are not enough chips available right now. So the supply chain has been like a really big challenge and companies are having to become creative in sourcing the appropriate components and supplies for their products for their new mobility services. RadPower is a good example of an eBike company having to adapt its supply chain.
And we see that even at Ride Report where our partners are unable to launch because they don't have enough vehicles because of the supply chain and shipping constraints.
The other challenge is, as we emerge from the pandemic, traffic starts increasing. And the question is: Did we learn any lessons? Are we going to apply any lessons we learned from the pandemic in terms of street design and safety as well?
We'll share Part 2 of Michal's thoughts next week!