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The Global Mobility Future

Tuesday, May 15, 2018

Shifting demographic trends, changing customer needs, and emerging non-transportation technologies are increasingly shaping how we move.

The auto industry, for example, may be transformed over coming decades by self-driving vehicle research happening at organizations outside the traditional core automakers.

“We’re living on the cusp of a profound and exciting transformation of many global industries that enable mobility: the automotive, airline, and logistics industries,” said John Moavenzadeh, head of Mobility Industries at the World Economic Forum USA, who spoke as part of Volpe’s Transportation and the Economy series. “These industries are going to change more in the next 10 years than they have in the previous 100 years.”

Global Mobility: Agents of Change

More than half of the world lives in cities, and the global population in urban areas will grow more than two-thirds by 2050, Moavenzadeh said. The ongoing global exodus from agrarian expanses to urbanized clusters will multiply congestion in already congested cities.

In Cairo, for example, the cost of congestion is $8 billion, about 4 percent of Egypt’s entire gross domestic product, according to the World Bank. The economic impacts of congestion around the globe amount to a tax that urban dwellers can no longer afford, Moavenzadeh said.

“Congestion matters because it stifles the economic lifeblood of cities, and cities are the economic lifeblood of nations,” Moavenzadeh said.

A highway congested with car traffic.The global population in urban areas will grow to more than two-thirds by 2050, multiplying congestion in already congested cities.

The world's population is also getting older, and the average age in nearly every country in the world is going up. Older transportation users may be chiefly concerned with convenience and access to mobility options, while today’s younger users are tomorrow’s older users.

In the U.S., younger transportation users have different mobility tastes compared to previous generations. Younger users are less interested in owning a car, are less likely to get a driver’s license, and are driving less overall, Moavenzadeh said.

Finally, developing economies have been engines of growth for air, automotive, and rail travel, and there is an assumption that that trend will continue for decades, Moavenzadeh said. Demand for personal vehicles in those economies will present great opportunities for automotive industries, but also great challenges related to climate change, traffic congestion, and health.  

Barriers to Mobility

Communication within and between nations will be critical to address mobility challenges, particularly related to funding for infrastructure. Discussions on big data, energy, and transportation often happen in parallel but separate universes, Moavenzadeh said, and in many cases regulatory leaders do not facilitate discussions across industries.

The infrastructure gap, meanwhile, sits at about $4 trillion per year, according to the World Economic Forum. That’s the gap between financing needed to build and maintain infrastructure, and the funding available. That gap is primed to grow without a systematic framework to think about mobility challenges.

“A few weeks back in Davos, the CEO of Volvo Trucks said, ‘Our trucks are so much smarter than they were 10 years ago, but the roads they drive on are as dumb as ever,’” Moavenzadeh said. “So there is this challenge of rethinking the system. How can we create policy incentives to encourage the great things all of you are trying to do here?”  

New Mobility Options

Market and technology innovations are meshing and evolving to address global mobility challenges. Millions of people across the world use car-sharing services that just a few years ago were a fraction as popular. For example, late last year, Uber was valued at more than $41 billion, 12 times its valuation the year before, according to the Wall Street Journal.

The Internet of Things and advances in connected vehicle technology are blurring the lines between industries, as complex partnerships blossom between automotive and non-automotive companies. Those partnerships and unique perspectives on the business of transportation will create alternatives to vehicle ownership, particularly in cities.

“The city of the past is one where the rich drive cars and the poor take public transportation,” Moavenzadeh said. “The city of the future is one where consumers choose from an array of different options to meet their mobility needs of the moment.” 

Pedestrians, cyclists, and cars travel through a dense urban area.
The city of the future is one where consumers choose from an array of different options to meet their mobility needs of the moment.