Urban mobility blueprint Business strategies in an emerging ecosystem. Global Automotive Center

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1 Urban mobility blueprint Business strategies in an emerging ecosystem Global Automotive Center

2 Reinventing urban mobility Growth in urban travel needs is fast outpacing the development of transport infrastructure. As stakeholders ranging from city administrations and transport to telecomm operators and shared mobility consider a variety of alternatives to current transportation, the need of the hour is to identify business strategies that enable sustainable integrated urban mobility. The future urban mobility context Passenger travel distance to double by 2050 over 70 trillion kms per year* Per capita commuting delay to double by 2050 to over 100 hours per year* Over 37 cities majority in Asia and Latin America to have over 10 million inhabitants by 2025* Over 70% of global population to live in urban areas by 2050, up from 51% in 2010* Don t assume we re always going to be in the car business...the notion is you don t have to have ownership of a vehicle, you just want to get from point A to point B. Chairman, global volume vehicle manufacturer...is no longer just an auto company. Sales & Marketing Chief, premium global vehicle manufacturer *Source: UN World Urbanization Prospects, World Business Council for Sustainable Development We see these evolving trends creating significant opportunities for stakeholders to create sustainable integrated solutions to address the future urban mobility market. To succeed in this emerging ecosystem, need to evolve their value propositions and also identify collaborative initiatives that can enhance their competitive positions. Mike Hanley Global Automotive Leader EY EY s Global Automotive Center has developed this urban mobility blueprint with the aim of: Defining the urban mobility ecosystem and its components including market needs,, infrastructure and stakeholders Identifying the evolving commercially viable business strategies and the associated risks and rewards Understanding trends in owning urban mobility customer relationships and their transport spend Evaluating the position and future role of the auto industry in this emerging ecosystem Identifying potential collaborative opportunities for stakeholders

3 Integrated mobility ecosystem sustainable, convenient and affordable end-to-end urban trips We define the ecosystem in terms of three components, namely, the mobility for end-users, the infrastructure that enables integration and the stakeholders that deliver these. The infrastructure and technologies are available today in certain markets and early entrants have begun to illustrate the benefits of integrating mobility. Our view is that the real value lies in integrating these three components of the mobility ecosystem. Consumers mobility Shift needs 1 in focus from vehicle ownership to mobility access flexibility, affordability, convenience and minimal delay Real-time mobility information and planning Single payment interface Connected transport modes Mobility integration Connectivity infrastructure 2 interaction with external environment E-commerce online payment and account management Data, information, insight and analytics Rapid transit stations and parking lots Technology and interface system integration Personal and public transport modes Stakeholders Infrastructure 3 providers Telematics, telecomm IT and payment systems Parking operators City administrators Civil transport authorities Urban development boards Transport modes operators Car sharing Public transport providers Automotive OEMs

4 Mobility business strategy variants We identified five mobility business strategy variants based on the they deliver to the customer. These strategies are at varied levels of complexity within the value chain and consequently, bring different risks and rewards to the participants. Stakeholders can use this framework to evaluate their current position and consider strategic options to either enhance their competitive position or expand their value proposition. Business strategy variants Real-time information One-stop payment system Private transport modes Public transport modes Risk Reward Transport navigator Mobility platform manager A provider of real-time transport information on mobile and other devices A developer of mobility management interface and applications On-demand personal mobility provider A provider of personalized, shared transport solutions Multi-modal public transporter A facilitator for integration of the multi-modal passenger transport network Mobility integrator A catalyst for end-to-end travel solutions combining public and private transport modes Low Medium High

5 Key considerations for stakeholders Automotive OEMs Public transport operators Civil authorities/ Urban planners Car/bike sharing IT and telecomm Do you have an urban mobility strategy? Personal mobility service-centric strategy Cities as customers for smart personal mobility Enabling multimodal public transport Enable real-time travel planning and booking Incentives and taxes to encourage use of shared mobility solutions User-created routes and oneway Customer feedback and user assessment mechanisms Customer usage data to offer valueadded Targeting cities as customers How are you adapting your product and? Car sharing and pooling networks Electric mobility Connectivity to substitute invehicle features Improve connectivity, flexibility Personal rapid transport systems Smart and integrated megacities Connecting public and shared transport networks Alternate fuel (electric, hydrogen) infrastructure Cross-selling of products and Vehicle access technologies (near-field communication) Single brokerage systems (information plus ticketing) Payment, cloud computing and connectivity technologies Are you collaborating with the right partners? Car/bike sharing Travel operators Car/bike sharing IT and telecomm systems integrators All mobility stakeholders Parking lot Public transport operators Corporate car/ sharing Civil authorities Urban transport planners Automotive OEMs This is the executive summary of a detailed analysis conducted by the Advanced Mobility Team at EY s Global Automotive Center. The Advanced Mobility initiative brings together players across industries that are currently transforming the automotive value proposition. Please contact our automotive professionals listed at the end of this document for more in-depth information.

6 EY Assurance Tax Transactions Advisory Global Automotive Center contacts Michael Hanley Global Automotive Leader Tel: Jeff Henning Global Automotive Markets Leader Tel: Anil Valsan Lead Automotive Analyst Tel: Jean-François Tremblay Advanced Mobility Leader Tel: Dr. Rainer Scholz Infrastructure & Mobility Advisory Services Tel: Regan Byron Global Automotive Marketing Manager Tel: About EY EY is a global leader in assurance, tax, transaction and advisory. The insights and quality we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide to clients. For more information about our organization, please visit ey.com. How EY s Global Automotive Center can help your business The global recession reset the automotive sector landscape. As the sector recovers, automotive across the value chain must focus on profitable and sustainable growth, financial and operational stability, investments in new technologies and seizing opportunities in high-growth markets. If you lead an automotive business, you need to anticipate trends, identify implications and make informed decisions that support your business goals. Our Global Automotive Center enables our worldwide network of more than 7,000 sector-focused assurance, tax, transaction and advisory professionals to share powerful insights and deep sector knowledge with businesses like yours. These insights, combined with our technical experience in every major global automotive market, will help you to accelerate strategies and improve performance. Whichever segment of the automotive sector you are in from component suppliers to commercial or light vehicle manufacturers or retailers we can provide the insights you need to succeed EYGM Limited. All Rights Reserved. EYG no. ED0092 CSG/GSC2013/ ED 0114 In line with EY s commitment to minimize its impact on the environment, this document has been printed on paper with a high recycled content. This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax, or other professional advice. Please refer to your advisors for specific advice. ey.com