Consumer Priorities Are the Key to Solving Urban Mobility

MUNICH—Cities will need to orchestrate their transportation systems to prevent them from collapsing under the strain of growing demand and competing mobility modes. But for urban mobility to be truly effective, municipal authorities should place consumer priorities at the heart of their plans, according to a new report from Boston Consulting Group (BCG). The report, Solving the Mobility Challenge in Megacities, is being released today.

Research Points to Three Main Priorities

BCG questioned more than 2,000 people in Beijing, Boston, London, and Moscow about their mobility priorities in late 2019, prior to the pandemic. “Megacities today are swamped with rival mobility offerings as multiple players compete for market share. Municipal authorities need to bring order to this chaos. But first, they must understand what consumers want from urban mobility. Our research suggests this comes down to three key elements,” said Nikolaus Lang, a BCG managing director and senior partner, and leader of the firm’s Global Advantage practice worldwide.

The priorities are:

• Productivity and Multitasking. Consumers want to use their time in transit for work and entertainment.
• Independence. Flexible schedules and on-demand mobility are key.
• Sustainability. Environmentally sustainable transport solutions are important differentiators for many consumers, especially millennials.

Significantly, most respondents said cost of travel, ease of use (for example, simple ticketing processes), and comfort were less important to them.

While COVID-19 has altered mobility decisions in the short term—with consumers more inclined to use private cars because they offer greater protection against the virus than shared forms of mobility—BCG believes the findings will hold true over the medium to longer term. Indeed, these findings should inform cities’ strategies as they work toward more integrated and effective urban transportation systems.

“Rapid urbanization is placing transportation systems under huge strain. Inadequate mobility leads to greater congestion and reduced productivity, but it is also a significant cause of poor health and social inequality. These problems are particularly acute in megacities,” said Alexander Wachtmeister, a managing director and senior partner in the firm’s Munich office.

Contrary to the often-touted shift away from car ownership that dominates much public debate, survey respondents expressed a growing desire to own a car. But the main reasons given for car ownership were practical concerns (including speed and flexibility) and necessity (due to a lack of better alternatives), rather than personal preferences (such as emotional attachment, the car’s importance as a status symbol, or the joy of driving). This suggests that consumers are willing to give up their vehicles provided cities create more effective transportation systems to take their place.

No-Regrets Moves for a Successful Mobility Future

BCG’s research found that emerging mobility options like ride hailing and micromobility are an improvement on traditional cars and mass transit when it comes to meeting consumers’ mobility priorities. But they solve only some user paint points. E-scooters, for example, offer consumers greater independence and an enjoyable, leisurely travel experience (provided the weather is fair). Still, e-scooters face sustainability challenges arising from their relatively short lifespans and safety concerns as well as the need for vehicle collection and charging.

In the city of the future, an orchestrator will be needed to impartially coordinate the activities of mobility operators in order to produce the best overall outcome for consumers. And cities will have to make fundamental changes in how transportation systems are organized and develop mobility management systems as well as digital customer platforms if they are to deliver more consumer-centric solutions.

To maximize the opportunities ahead, city planners and private players should pursue a number of no-regrets moves. They should define their ambition, invest in new competencies, develop partnership arrangements, and, in the case of companies, create effective governance for business units focused on the latest mobility-related areas.

To arrange an interview with one of the authors, please contact Eric Gregoire at +1 617 850 3783 or gregoire.eric@bcg.com.