Mobility as a Service (MaaS) and modal capacity shortfall

31 August 2017
From our ‘Thinking outside the box’ series
Mobility as a Service (MaaS) is talked about a lot as the new approach to delivering transport services that are better tailored to the needs of travellers, as it gives modal flexibility under various pricing offers. David Hensher explains further.

Mobility as a Service (MaaS) is talked about a lot as the new approach to delivering transport services that are better tailored to the needs of travellers than the existing modal services that, with exceptions, do not allow switching between all possible modes (public transport, car in its many variants including taxi, Uber, car next door, go get, electric bikes etc.,). MaaS is a mobility subscription plan that gives modal flexibility under various pricing offers. As MaaS is rolled out across metropolitan areas over the next 5 to 15 years (with or without the presence of autonomous cars and buses - the latter being mainly smaller buses), and growing acceptance of a sharing culture and disposal of privately owned cars, public transport operators will be given the opportunity to both operate a mobility plan and/or to offer up their current and future public transport services. The bus in particular is expected to play a significant role as a service provider under mobility plans. This all sounds very attractive and may indeed reduce the need for government subsidy where the mobility subscription plan can deliver much more cost efficient services that reduce, if not eliminate, the need for government subsidy. Even where it is recognised that a community service obligation (CSO) has merit within a mobility contract, it is anticipated that the level of subsidy will be small. To what extent is currently unknown.

An issue that I recently considered is the extent of demand for the current (or expanded) bus services when they migrate to a subscription service. Imagine a situation of multiple brokers and existing bus operators offering their services into a number of such broker-designed and controlled MaaS subscription plans.  Suppose we suddenly find that there is a high demand for the use of the bus services in a number of plans such that the supplier of the bus services cannot honour the service level agreement under each of the mobility contracts they have with the number of brokers.  What do we do?

This is potentially a major issue. At present we have a one to one arrangement between a bus operator and government (principle-agent), and such contracts typically ensure that contracted services can be delivered with the existing stock of vehicles; however under MaaS we may have a one to many (brokers) situation. The arrangement may work well with cars since it is relatively easy to bring more on board, but with buses this may be a significant challenge. There will need to be a contingency plan to access additional bus capacity (or an alternate modal solution), but from where?

They way this may have to get sorted is to use car capacity (drawn from a brokers pool) which is much easier to obtain when there is a shortage of bus capacity and have users pay the equivalent bus fare. Although this is encouraging in ensuring the continuity of mobility services (effectively a sharing under a pooled car use model), it will require a commitment of the either the mobility plan provider, the bus service provider or government to provide the gap between the bus fare and the car-based fare. Under an autonomous car (and bus) regime this may be a relatively small amount compared to today’s gap since labour costs will be significantly reduced (i.e., no driver).

As we continue to explore the appeal of MaaS in digitally induced mobility setting, we can anticipate many new question and hopefully new solutions. The proposition herein is but one we need to think through as we scale up the delivering of MaaS.

David Hensher is Professor of Management, and Founding Director of the Institute of Transport and Logistics Studies.

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