New mobility and the shift from ownership to sharing (2): Rising pressure to change

Daimler, BMW, VW, Ford, GM, Toyota, and Nissan

2017/02/13

Table of contents

Why is the trend towards new mobility gaining attention among OEMs?
Daimler's CASE strategy: Connectivity, Autonomous driving, (Car) Sharing, Electrification
BMW: The Next 100 Years
VW: Establishment of the new mobility company "MOIA"
Ford: Becoming an auto and mobility company
GM: Establishment of the Maven brand, investments in the dispatch service Lyft
Toyota: Aiming for a "new business and revolution in the automobile industry"
Nissan: Intelligent mobility strategy

Why is the trend towards new mobility gaining attention among OEMs?

Future car sharing service vehicle image Source: Daimler

The potential market size of mobility services is estimated to be an annual USD 5.4 trillion Source: Ford

The inclusion of new mobility services by OEMs in their business strategies has been becoming a noticeable trend since 2016. These new mobility services disregard private ownership of automobiles in favor of means like ridesharing and car sharing.

According to Daimler (see chart below), new mobility services such as car sharing have emerged as a response to socio-economic changes like ever-expanding urban concerns over congestion, air pollution, and parking spaces; digitization; and a decrease in the desire for ownership.

These new sharing-based mobility services are expected to grow even more in the future, and have the potential to overturn automakers' existing business models of selling all of the automobiles they produce to consumers.

Automakers such as Ford have estimated the global market size of traditional vehicle sales to be USD 2.3 trillion, but the potential market size for mobility services is estimated to be USD 5.4 trillion, and it will become a major source of income in the future (see chart to the right).

The efforts by major global automakers covered in this report can be seen as an effort to understand the business models these new services will generate, as well as a search for means to survive.

Socio-economic changes such as growing urban problems, digitization, and a decrease in the desire for ownership

The president of Daimler's car sharing service subsidiary car2go Europe expects one-way car sharing services to expand, and as socio-economic changes such as growing urban problems, digitization, and a decrease in the desire for ownership continue to advance, users of car sharing services are projected to increase five-fold by 2025 (December 2016).

One-way car sharing services remain in the early stages of development	Changes such as urbanization, digitization, and the decrease in desire for personal ownership among younger generations promote development.
Car sharing services are rapidly growing	According to a 2016 Frost & Sullivan forecast, car sharing services users will grow five-fold from today's 7.9 million to 36.7 million in 2025.
Large cities will require one-way car sharing services	The World Bank predicts that in 2045, there will be 6 billion people living in urban areas, 1.5 times the population of today, and with congestion and limitations for parking spaces, as well as the issue of air pollution, private ownership of automobiles is nearing its limit. One-way car sharing services can help reduce the number of vehicles to help solve these issues.
Future car sharing services will use EVs	If car-sharing services use EVs, air pollution in central urban areas will be ameliorated and governments will offer their support.
Car sharing will create various services	Vehicles used by car sharing services are connected to networks and user smartphones, and will provide a foundation for creating other new services.
Autonomous vehicles will comprise half of one-way car sharing services	According to a 2016 prediction by Frost & Sullivan, if car sharing services start to operate autonomous vehicles, this will allow them to autonomously park the automobiles in a parking lot for standby vehicles and autonomously pick up users when called for. If demand can be precisely forecasted, occupancy rates can be improved, and the number of autonomous vehicles required by car sharing can be reduced to half of the current number of vehicle in the companies' fleets to cover demand equally.

Source: Daimler press release 2016/12/14

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