FARE GAME

Startups in Germany are racing their Silicon Valley rivals to reinvent the bus

The “shared mobility” industry is a confusing tangle of automakers and tech companies developing services for car-sharing, car-pooling, and ride-hailing at the tap of an app. Passenger cars have been the focus in recent years, but now the humble bus is up for re-imagining as well.

Two startups in Berlin are developing on-demand shuttle buses, equipped with AI that figures out where people are and where they want to go, tracing algorithmically optimized routes around town. One is owned by Volkswagen and will deploy fleets of VW vans, while the other is building an AI-powered platform for urban planners to link roving shuttles into local transport networks.

Volkswagen’s move into the field is via the Berlin-based startup Moia, which launched at TechCrunch Disrupt in December last year. It is planning to roll out electric shuttles in Hamburg in 2018, making a bet on an urban future where hundreds of six-person vehicles roam the streets, scooping up people who are heading in roughly the same direction and dropping them off at different points along the way.

“That’s where we think we can have the maximum impact out of all those shared concepts right now, if we bring something onto the street which is bigger than a normal car,” says Moia’s Michael Fischer.

Fischer says Moia is not competing with the likes of Uber. “We’re not a door-to-door service, we’re not ride hailing. You have virtual bus stops where you have to go, which will be reachable within some minutes, and then you go to where you want to go—within a few hundred meters.”

Moia has a few big things to figure out before its shuttles hit the streets. First up, it needs to actually build the vehicles. Although Volkswagen can draw on Gett’s systems knowledge—it invested $300 million in the ride-hailing company last year—it says the biggest challenge so far has been finding the right developers to tweak the shuttle’s algorithm. To that end, it bought Finnish software firm Split Finland in June.

Going public

Berlin-based startup door2door is a minibus service that works with local governments to supplement the public transport system. Co-founder Maxim Nohroudi says today’s ride-sharing services need to be connected with public transport, since “cities want to control and operate their own mobility platforms.”

“Uber cannibalized public transport,” Nohroudi notes. The current business model of many shared-mobility companies means more traffic, more CO2 emissions, and fewer parking spaces in cities, he says.

Door2door is currently trialling its shuttle in Berlin to showcase how on-demand rides work in tandem with public transport. For example, a shuttle could go to a spot where crowds typically come out of a subway stop and and take them to another point in the city.

 Ride-sharing services need to connect to public transport, since “cities want to control and operate their own mobility platforms.” In the US, meanwhile, Ford and Lyft are among the companies motoring ahead with their own makeovers of the bus. Lyft Shuttle is being tested in San Francisco while Chariot, a San Francisco-based commuter ride-sharing startup acquired by Ford last year, plans to roll out in eight US cities this year.

Fleets of shuttle buses, of course, initially add more vehicles to crowded streets, but Moia’s CEO Ole Harms says you first need to offer a service before you can start to see the positive effects, like increased carpooling or a reduction in private car ownership.

“Current sharing concepts show, as soon as there are more mobility options many people tend to change their mobility behavior,” Harms wrote in an email to Quartz. He also believes that there is enough space for many shared-mobility services to co-exist: “Bearing in mind that in most big cities we nowadays have millions of cars but only some thousand sharing vehicles there is plenty of potential for new concepts and new players.”

Critics say that, beyond whizzy apps and flexible schedules, many shared-mobility startups aren’t nearly as disruptive as they claim to be. Of Lyft’s shuttle service, for example, “in other parts of the world that are not Silicon Valley, this is known as a ‘bus,’” wrote Jalopnik dismissively. The ultimate goal for many of these startups, though, is fully autonomous, self-driving shuttles, which would of course represent a significant break from the status quo. The question is whether German automotive know-how or Silicon Valley tech expertise will get there first.

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