What is in store for the mobility market?

The mobility market is a $ 7 tn industry globally - making it one of the biggest addressable markets out there. This industry produces around $700 bn in profits - contributing to 9% of the global GDP. 

The new mobility market comprises of

- Ride-Hailing

- Micro Mobility

- Electronic Vehicle

- Autonomous Vehicle

Micro mobility means the last mile connectivity through e-bikes (or citi bikes) and scooters

The ride-hailing profitability is dependent completely on the competition. Wherever there is intense competition - the contribution is ~ -10% and where there isn't (such as Europe) the contribution is able to reach ~ 50%. Right now, ride-hailing is still considered as a luxury service and the aim is to bring it down to utility service. The way this can be achieved is by revolutionizing how your car ownership works. Your car on an average remains idle for 95% of its time during its life and its a depreciating asset. Ride Hailers want to use your car when it is sitting idle (when you go for a job)- which could mean an additional disposable income of up to $500 p.m.

The perfect way this could happen is through the advent of autonomous vehicles. With the advent of AI in vehicles, the most expensive part of ride-hailing can get wiped off - the labor cost which accounts for 70% of the cost. 

Btw, flying cars haven't disappeared. They will be a day to day sight by 2025. This is being led by the company Lilium. Of course, affordability, kind of fuel consumption and regulatory oversight would be key issues. 

Authored by :

Sushil Krishnan

President '19