Are we going nowhere fast?

@LawAhead

The complexity of the regulatory panorama won’t allow us to make concrete predictions about the future of Smart Mobility. Evaluating the different paths Smart Mobility might take, however, will allow us to prepare for its future challenges and opportunities.

Author: Ricardo Ángel Barrientos, Bachelor in Politics, Law and Economics

Humans are restless. We seem to have this urge to keep moving, the faster the better. The problem is that we often don’t know where we are going. How we move will depend on the future of Smart Mobility. What direction, then, is Smart Mobility heading towards?

In another enlightening event organized by the LawAhead Hub, Julio Gómez – Pomar, President of the Center for the Transport Economy and Infrastructure Management at IE University, and Salvador Aragón, Chief Innovation Officer and professor at IE Business School, adeptly and effectively described the role of regulators in the future scenarios of Smart Mobility.

When critically evaluating any topic, it is always a good idea to start with the question, why should we care? Why are regulators concerned about mobility? How and why will the future scenarios of Smart Mobility affect us? Some answers to these questions emerge rather quickly, while others require more nuanced thought. I want to offer a seemingly evident but possibly striking answer to why mobility should be of concern to us, which attempts to include the reasons Mr. Gómez – Pomar described during the event.

Creative decision-making regarding alternatives to mobility requires creative understanding of the future scenarios that will result from the different possible private-public interactions.

If we were to design mobility from scratch, considering the circumstances we face today, we cannot imagine many realistic solutions that are less efficient than using a one-and-a-half-ton vehicle to move a 70-kilogram person across a few blocks in a crowded city. And while cars are not only used for short distance displacements of single individuals, such is often the case. Using cars heavily pollutes already polluted cities, strains already strained public infrastructure, consumes people’s time and risks people’s lives. As described by Mr. Gómez – Pomar, the current state of mobility, precisely because of the many challenges it encounters, also provides business and investment opportunities. Will we be able to dispense traditional means of transportation in exchange for better alternatives tailored to the needs of today and tomorrow?

Creative decision-making regarding alternatives to mobility requires creative understanding of the future scenarios that will result from the different possible private-public interactions. Professor Aragón excelled at facilitating such understanding. Instead of highlighting the utter inability we have to predict the direction of technologies, or discussing the best and worst-case scenarios for the future of Smart Mobility, Professor Aragón proposed an alternative way to intuitively understand future outcomes, in a way that can be applied not only for Smart Mobility, but also for other areas in which regulators and businesses interact.

 

Escenarios to prepare for the future of Smart Mobility

In order to prepare for the scenarios that await Smart Mobility, we need to conceptualize them as a spectrum, focusing on the possible attitudes regulators and business may adopt, and trying to understand the results of the different possible public-private interactions. More importantly, legal professionals and those working in related fields must use such understanding to develop competencies in themselves and their teams that can be used as a response for each of the different scenarios. We may not know exactly where we will be heading, but through considering the implications of the different stances regulators and private actors might take, we are able to narrow our focus, enabling us to make informed decisions on how to prepare and react to these different scenarios.

Enough has been said about where we might be going, but where are we now in terms of regulation? As explained by Mr. Gómez- Pomar, mobility is very city-specific, so the layers of regulation that oversee and control sustainable and Smart Mobility in cities are multiple and often difficult to aggregate. When considering mobility in the city of Madrid, for example, an action plan has to be drafted that takes into account the goals and plans set at a regional, national and supranational level. As stated on the Leipzig Charter of 2007 on Sustainable European Cities, competences to decide what cities need and where they are heading are national in nature, but the European Union has proposed guidelines and suggestions and is offered as a platform for cooperation and exchange of ideas[1]. By the same token, the European Commission’s White Paper of 2011 on the future of mobility sets the path towards a more integrated mobility system, one in which cities, under their national governments, cooperate and lead the way towards smarter and more cohesive ways of transportation throughout the European Union[2].

In Spain, the Sustainable Economy Law 2 / 2011 of March 4th nationally regulates aspects of Sustainable Mobility and Urban Planification, discussed in an article by Consuelo de los Reyes Marzal Raga for the National Institute for Public Administration (Instituto Nacional de Administración Pública, INAP), explains how communities have already devised laws and schemes concerning mobility, while describing the role that national law will play with regards to pushing for cities to develop their own action plans, with supervision and guidance by central institutions[3]. Again, the agents that will play a more direct role in the transition towards Smart and Sustainable mobility are cities, which are expected to act in a framework that takes into account national interests and supranational suggestions.

The Article by de los Reyes Marzal Raga also hints at possible scenarios where the private sector may play a pivotal role, since it marks key transition points such as the dissuasion of private motorized vehicles, or the pedestrian periodization of traffic lights. If these and other opportunities are complemented by an innovative and disruptive private sector, powerful synergies can be formed that will positively transform the way we move in cities. On the contrary, if cities impose mobility restrictions but are unwilling to find or facilitate creative alternatives to urban mobility, we will face a more conservative and possibly troublesome transition.

When considering the current and future Smart Mobility regulatory frameworks, it is necessary to be careful about the different tiers and definitions that can be found

Innovative solutions to mobility are definitely needed, but whether the recent developments are improving the current state of mobility is not clear cut. In some cases, the private sector might offer potential solutions or improvements to current mobility problems, such as by decreasing the excess consumption of fossil. The Mobility as a Service (Maas) Report published by the Juniper Research Center predicts that by 2023, the fuel cost savings resulting from the growth of MaaS will increase to $32 billion from the $210 million of 2018[4]. Meanwhile, regulators are right in placing some mobility alternatives under scrutiny, which, although they claim to complement public transportation and improve mobility, can do exactly the opposite. Such is the case with Uber and Lyft, for example, which have been found to be highly responsible for the massive traffic increase in the city of San Francisco. New taxes, Wired claims, charged per solo ride and per car-pool ride were negotiated in the San Francisco city council and accepted by Uber and Lyft, evidencing a private-public cooperation, which, even if the ride-hailing companies have the underlying intention of clearing their images, is nonetheless a foreshadowing of the interactions we are likely to witness as we move to other uncharted territories[5].

When considering the current and future Smart Mobility regulatory frameworks, it is necessary to be careful about the different tiers and definitions that can be found. Many action plans in Spain focus on Sustainable Mobility, which, even if it is a component of Smart Mobility, does not include the role of information technologies and non-environmental aspects of mobility to the same extent that Smart Mobility does. Also, Smart Mobility is a key component of Smart Cities, for which the European Union has already set several guidelines and action plans, but it is not the only component. Finally, the different layers of potential intervention and regulation – municipalities, regions, states, and the European Union – entail a complex interplay, having cities as a focus, but understanding the need for cooperation and more centralized support and decision-making. Where and how the private sector will appear in this scheme remains to be seen; analyzing the possible ways in which it will, is up to us.

 

Ricardo Ángel Barrientos is a second-year student of Politics, Law and Economics at IE University. He is president of the Political Think Tank Club in Segovia and Editor of the LawAhead Hub in Madrid. He has experience working with the social investment firm GAWA capital, the risk management and risk assessment firm ASR S.A.S., and the Fintech startup Quienmepresta.com. 

 

Note: The views expressed by the author of this paper are completely personal and do not represent the position of any affiliated institution.

[1] European Commission. “LEIPZIG CHARTER on Sustainable European Cities .” LEIPZIG CHARTER on Sustainable European Cities , 2 May 2007. ec.europa.eu/regional_policy/archive/themes/urban/leipzig_charter.pdf.
[2] European Commission. White Paper on TransportWhite Paper on Transport, European Commission, 2011, ec.europa.eu/transport/sites/transport/files/themes/strategies/doc/2011_white_paper/white-paper-illustrated-brochure_en.pdf.
[3] De los Reyes Marzal Raga, Consuelo. “LA LEY DE LA MOVILIDAD SOSTENIBLE Y LA PLANIFICACIÓN DE LA MOVILIDAD URBANA.” La Administración Al Día, INAP, 16 Nov. 2012, laadministracionaldia.inap.es/noticia.asp?id=1106013.
[4] Juniper Research. Mobility-as-a-Service Revenues to Exceed $11 Billion by 2023, as Regulation Drives Adoption. 15 Oct. 2018, www.juniperresearch.com/press/press-releases/mobility-as-a-service-revenues-to-exceed-$11-billi.
[5] Marshall, Aarian. “Uber and Lyft Made Traffic Worse in San Francisco. But It’s Complicated.” Wired, Conde Nast, 16 Oct. 2018, www.wired.com/story/uber-lyft-san-francisco-traffic-report/.