Responsible innovation Agenda for Competitive European transport industries up to 2050

Información del proyecto

RACE2050

Identificador del acuerdo de subvención: 314753

Proyecto cerrado

Fecha de inicio 1 Septiembre 2012

Fecha de finalización 28 Febrero 2015

Financiado con arreglo a

• Specific Programme "Cooperation": Transport (including Aeronautics)

Coste total € 1 324 516,10

Aportación de la UE € 1 203 158,00

Coordinado por

TECHNISCHE UNIVERSITAT BERLIN
Germany

Final Report Summary - RACE2050 (Responsible innovation Agenda for Competitive European transport industries up to 2050)

Executive Summary:
We have to invent the future we want.
Otherwise, we get the future we don’t want.
Joseph Beuys


RACE2050 foresight study aimed to identify key success factors for a climate and environment friendly and socially acceptable growth of European transport industry, and for those policies which can preserve and even increase its sustainable strength in a long perspective over the next decades up to 2050.
RACE2050 goal was to develop a new set of scenarios for 2030 and 2050. Hence, RACE2050 is not just going to add another foresight study to the library: As an important step towards the construction of new scenarios it aims to integrate the tremendous foresight intelligence in a comparative synopsis, with special emphasis on climate and environment friendly and socially acceptable growth, and to compare and assess the different visions and especially the differ-ent policies to reach these goals.

RACE2050 elaborated wide activities in defining past and currents trends of policy and frame-work conditions regarding the transport industry, with a special attention to long term analy-sis, also in a retrospective way. The demand side has been largely explored having a 2030 and 205 horizon. The current and expected trends so the UE transport industry were the core of another investigation path.

One of RACE2050’s key ideas was not just to add another foresight study to an already exten-sive library of future studies in the transport field, but to integrate and visualize the tremen-dous foresight intelligence in a comparative synopsis.
Therefore, RACE2050 developed the Transport Synopsis Tool, a free online platform that for the first time enables industry stakeholders, policy makers and the wider public to access a comparative analysis of a magnitude of almost 100 future studies concerning the European transport industry. Based on an extensive review of these studies, the RACE2050 project team evaluated the study’s assessments regarding their assumed relative importance of a range of 15 predefined competitiveness parameters.

RACE2050 also prepared six scenarios on the future of the European transportation industry. For 2030, the project team decided to develop predominantly pessimistic and cautionary visions, based on an extrapolation of existing negative trends (“Dark scenarios”) and on the historical conviction that negative or horror scenarios successfully triggered adaptation and development processes within the European transportation industries. On the contrary, the 2050 visions combine positive answers to existing challenges with optimistic assumptions about a deep transformation of the industry based in particular on cultural changes (“Bright scenarios”). For both time horizons, a main scenario is accompanied by two less comprehensive “side-scenarios” that highlight specific developments and that can be understood as more extreme alternatives to the main scenario.

Project Context and Objectives:
1. Background

RACE2050 foresight study aims to identify key success factors for a climate and environment friendly and socially acceptable growth of European transport industry, and for those policies which can preserve and even increase its sustainable strength in a long perspective over the next decades up to 2050.
While many other European industries, in the last four decades, have suffered from global competition and relatively declined, as the textile industry, or almost disappeared, as the mining industry, the European transport industry remained at large competitive and strong on a global level. It stands as one of the largest and most competitive European industries. This is generally true both for equipment and services, though with great differences from branch to branch. There are some dozen serious long term foresight studies on the future of transport industry on a European level and on different national levels on our bookshelves. Most studies do not only foresight (or even forecast, predict, extrapolate) but aim at developing specific policies to reach an envisioned future, most often not only (or not even) mainly a stronger but also a greener, less CO2-intensive and more user friendly transport industry. Our idea is to develop a new set of scenarios for 2030 and 2050. Hence, RACE2050 is not just going to add another foresight study to the library: As an important step towards the construction of new scenarios it aims to integrate the tremendous foresight intelligence in a comparative synopsis, with special emphasis on climate and environment friendly and socially acceptable growth, and to compare and assess the different visions and especially the different policies to reach these goals. We compare the analyses and assessments of European transport industry foresights and then discuss the results with experts from transport industry, research and policy and with foresight experts. By this, we come up with weighted explanations and long durée core concepts for a sustainable strength of transport industry.


2. Definition of competitiveness
Two definitions of competitiveness have been taken into account when assessing the impacts of the selected policies on the European transport industry. Reinaud (2004. Industrial Competitiveness under the European Union Emissions Trading Scheme. Paris: International Energy Agency) writes the following:

Industrial competitiveness is a complex and multi-faceted concept. It depends on a number of factors including the primary and the secondary input costs, the availability of skilled labour, ability of companies to compete on quality, value-content as well as costs and generate innovations which could be successfully deployed in the market and commercially discharged. International industrial competitiveness is generally viewed as an industry’s ability to export its goods, with industry being defined as a group of firms that produces similar goods and/or systems.

According to the WEF Global Competitiveness Report “competitiveness”, it relies on twelve pillars, institutions, infrastructure, macroeconomic environment, health, and primary, higher and vocational education and training, market efficiency, labour market efficiency, financial market development, technological readiness, market size, business sophistication and ability to innovate. Our task to assess how the European policies have influenced global competitiveness of European transportation industry will focus on impacts on they have invoked on business environments such as needs for environmental and social protection, energy effectiveness, and adherence to safety, security legislation and other legal requirements.


3. Transport demand trends
The next table, retrieved from Race 2050s’ deliverable D5.1 presents the expected evolution of global demand for Transport in the medium term, according to various foresight studies on the Transport sector.

Table 1 – Expected evolution of transport demand by mode by different sources (index 100 = 2010)


These values represent a high level view on what current foresight studies indicate for future Transport demand growth. This range of figures set out clearly that current expectations for demand growth are of a very significant increase over the next 3 to 4 decades, to which Transport planners and industry players must envisage the best strategies to cope with.


4. EU transport industry trends
All the scenarios available forecast a constant development of the transport market, both in passengers and freight volumes, to a ratio bigger than the global GDP expected growth, alt-hough this trend is challenged by new social behaviours. The industries landscape is changing in all the sub-sectors: vertical and horizontal integrations and creation of European big players are the main current trends, a tendency which is not ended yet.

Service industry
Although benefiting from growing volumes, the whole European transport service industry nevertheless presents poor financial results and difficult market conditions. Thus, the need for a radical new shape of the business (as proposed for the shipping industry), a different approach to customers’ behaviours (as for the private land mobility) and, more generally, an end-to-end offer needs to be addressed. Environmental awareness has spread more and more, and is considered not a burden but a potential selling point; higher energy prices are affecting rather strongly the sectors’ economic sustainability, thus pushing to energy saving strategies.
About the EU-27, it is, all together, a mature market. However, the present scenarios forecast increasing freight volumes for the next decades, although lower than the emerging economies.

Manufacturing industry
As for services, growth of the global market is also expected in the manufacturing industry. Although truly internationalised, the transport manufacturing industry is usually close to the markets served, which has pushed many EU companies to open plants and assembly sites in emerging economies. Considering the role of those new markets, the leadership position of the European industry is challenged by new entrants, which enjoy a fast growing home market, lower technological gaps and lower final costs.
The automobile and the railway sectors are the most exposed to international competition, in which emerging economies’ companies are playing a more relevant role. The high-tech segment and – for the car industry – the premium sub-market are less vulnerable to this trend.
The aviation sector is still a duopoly dominated by Boeing and Airbus, but four non-EU companies will be stepping into the market in the next years, thus giving a new configuration to the industry.

Technology innovation and market challenges
Energy issues will become more and more central in the future. The transportation sector is still heavily dependent on fossil fuels and its price development. It is highly possible that there will be a rise in the real price of energy in the coming decades. In the near future the use of fossil fuels in transportation will increase, despite programs and guidelines for energy efficiency and a reduction of emissions. There are challenges and opportunities concerning this topic. A lot of countries deal with the challenge of energy security and develop strategies to become more independent of the fluctuating energy price. This also affects future developments in the transportation sector and is therefore a topic of global interest.
Novel materials with improved properties are a prerequisite for more sustainable, efficient and environmentally friendly transportation means. The transportation industries have already begun to utilize advanced materials such as nano-materials, for specific applications. Advancements in materials science and especially in nano-technology offer new possibilities for a wide range of structural and (multi)functional nano-materials with unprecedented properties. For example, certain nano-composites as well as nano-engineered metals have the potential to significantly reduce the weight of aerospace, automotive and naval structures. In this sub-chapter several interesting and important application areas are reviewed, such as high-strength light-weight materials for vehicle structures and engines, self-healing materials and sophisticated coatings, materials enabling high performance power sources, smart materials for adaptive structures, and materials for improved transportation infrastructures.
ICT products are crucial to the transportation industry. For example, in today's cars there are up to 100 microcomputer-based systems called Electronic Control Units (ECUs).
The advancement of ICTs is also related to the effective exploitation of alternative engines. Gas and diesel engines will improve mostly due to electronics advances. ICTs will also impact driver assistance systems, including warning systems, error correction, and collision mitigation. The EU has competitive advantages in some areas, such as core Auto ECUs, and Advanced Driver Assist Systems (ADAS). In the area of Electric Vehicle ECUs, the EU is less competitive and needs to do more to stay in the game.

5. RACE2050 scenarios
RACE2050 prepared six scenarios on the future of the European transportation industry. For 2030, the project team decided to develop predominantly pessimistic and cautionary visions, based on an extrapolation of existing negative trends (“Dark scenarios”) and on the historical conviction that negative or horror scenarios successfully triggered adaptation and develop-ment processes within the European transportation industries. On the contrary, the 2050 visions combine positive answers to existing challenges with optimistic assumptions about a deep transformation of the industry based in particular on cultural changes (“Bright scenari-os”).
For both time horizons, a main scenario is accompanied by two less comprehensive “side-scenarios” that highlight specific developments and that can be understood as more extreme alternatives to the main scenario.

6. RACE2050 Synopsis tool
One of RACE2050’s key ideas was not just to add another foresight study to an already exten-sive library of future studies in the transport field, but to integrate and visualize the tremen-dous foresight intelligence in a comparative synopsis with the aim of identifying and comparing the many different assessments and estimations about the key factors that are assumed to shape the future competitiveness of the transport industry.
Therefore, RACE2050 developed the Transport Synopsis Tool, a free online platform that for the first time enables industry stakeholders, policy makers and the wider public to access a comparative analysis of a magnitude of almost 100 future studies concerning the European transport industry. Based on an extensive review of these studies, the RACE2050 project team evaluated the study’s assessments regarding their assumed relative importance of a range of 15 predefined competitiveness parameters. The review of such pertinent transport future studies and future industry scenarios comprised the investigation of seven primary and eight secondary parameters that could be evaluated on a scale from 1 (“Extremely relevant” issue for the industry and/or the market, positively or negatively”) to 4 (“Competitiveness factor was not mentioned at all”). These parameters are not chosen randomly, but are based on RACE2050’s enduring substruction of the most crucial competitiveness parameters out of dozens of future studies as well as on the World Economic Forum’s (WEF) global competitiveness reports. These assessments fed a database that finally formed the core of the Transport Synopsis Tool and enables serious, informative and playful interaction.
With the aid of clear visualizations and individual search options, dozens of otherwise isolated future studies and scenarios from 11 industry segments are integrated into a comparative tool, facilitating the identification of key success factors for a sustainable growth of the European transport industries, which can increase its strength in a long perspective up to 2050.

Visualizations of reviews are offered either in a “Radar” or a “Bar Chart” modus.


As this tool is not only intended to illustrate (contradictory) paths for future growth of the sector, the Transport Synopsis Tool is also developed to grow itself. Designed with the idea of an open network character, the tool strongly encourages the possibility to add new reviews of fresh future studies or scenarios to the platform in order to let it grow gradually.
The Transport Synopsis Tool aims at both informing the transport industry community by highlighting key factors for competitiveness as well as to facilitate the discussion among experts from transport industry, research, policy and foresight experts. In this vein, this tool, which was for the first time presented to the public at the InnoTrans trade fair Berlin in September 2014, will persist as a legacy well after the end of this project, and, beyond that, is developed to implement continuous extensions and amendments to let it become one of the leading European future platforms in the transport realm.
http://www.transport-synopsis.eu


Project Results:
We have to invent the future we want.
Otherwise, we get the future we don’t want.
Joseph Beuys


1. Background

RACE2050 foresight study aims to identify key success factors for a climate and environment friendly and socially acceptable growth of European transport industry, and for those policies which can preserve and even increase its sustainable strength in a long perspective over the next decades up to 2050.
While many other European industries, in the last four decades, have suffered from global competition and relatively declined, as the textile industry, or almost disappeared, as the mining industry, the European transport industry remained at large competitive and strong on a global level. It stands as one of the largest and most competitive European industries. This is generally true both for equipment and services, though with great differences from branch to branch. There are some dozen serious long term foresight studies on the future of transport industry on a European level and on different national levels on our bookshelves. Most studies do not only foresight (or even forecast, predict, extrapolate) but aim at developing specific policies to reach an envisioned future, most often not only (or not even) mainly a stronger but also a greener, less CO2-intensive and more user friendly transport industry. Our idea is to develop a new set of scenarios for 2030 and 2050. Hence, RACE2050 is not just going to add another foresight study to the library: As an important step towards the construction of new scenarios it aims to integrate the tremendous foresight intelligence in a comparative synopsis, with special emphasis on climate and environment friendly and socially acceptable growth, and to compare and assess the different visions and especially the different policies to reach these goals. We compare the analyses and assessments of European transport industry foresights and then discuss the results with experts from transport industry, research and policy and with foresight experts. By this, we come up with weighted explanations and long durée core concepts for a sustainable strength of transport industry.


2. Definition of competitiveness
Two definitions of competitiveness have been taken into account when assessing the impacts of the selected policies on the European transport industry. Reinaud (2004. Industrial Competitiveness under the European Union Emissions Trading Scheme. Paris: International Energy Agency) writes the following:

Industrial competitiveness is a complex and multi-faceted concept. It depends on a number of factors including the primary and the secondary input costs, the availability of skilled labour, ability of companies to compete on quality, value-content as well as costs and generate innovations which could be successfully deployed in the market and commercially discharged. International industrial competitiveness is generally viewed as an industry’s ability to export its goods, with industry being defined as a group of firms that produces similar goods and/or systems.

According to the WEF Global Competitiveness Report “competitiveness”, it relies on twelve pillars, institutions, infrastructure, macroeconomic environment, health, and primary, higher and vocational education and training, market efficiency, labour market efficiency, financial market development, technological readiness, market size, business sophistication and ability to innovate. Our task to assess how the European policies have influenced global competitiveness of European transportation industry will focus on impacts on they have invoked on business environments such as needs for environmental and social protection, energy effectiveness, and adherence to safety, security legislation and other legal requirements.


3. Lessons from the past
In the last 50 years the European transport industry faced several threat periods and external competitive pressures that pushed to reorganize and to readjust industrial and political struc-tures. The American threat (in the 1960s and early 1970s) emphasized Europe’s missing econ-omies of scale; the subsequent Japanese threat (in the 1980s and 1990s) emphasized Europe’s low quality and poor production efficiency compared to Japanese lean production; and the ambiguous Chinese threat (from 1990s and beyond) currently highlights the country’s low production costs, which already induced wide-ranging off-shoring activities to Asia. In the following, this report identifies and assesses diachronically the content of changes in the respective framework conditions and identifies several trends envisioned by previous foresights as well as their impacts on the transport and on the political field. With this long-term assessment the report aims to detect patterns of foresight and effects on the transport industry, leading also to a better understanding of how foresights may induce industry changes, adaptations and competitiveness at large. Thus, it shall provide useful ideas and lessons from the past that not least generate recommendations for RACE2050’s strategic content of transport industry foresights up to 2030 and beyond.

The American threat
1960s future forecasts often projected the European fear of becoming an American “satellite”, which eventually pushed to closer European collaboration and the renewal of the European integration process. In order to cope and to compete with economic and technological American supremacy, Europe for the first time seriously envisioned to achieve a ‘critical mass’, thus benefiting economic and political scale effects. As responses to the threatening future forecasts, transnational collaboration, common policies and a wider market were consequent measures to establish framework conditions competitive against the US. In the transport field, among the beneficiaries we can list the precariously weak European aviation sector that heavily benefited from strategic governmental investments. Prominent outcomes were the Concorde and Airbus Industry, considered for us as political and technological responses to the American threat. Hence, in the long run, the American threat paradoxically appears to be “the luckiest chance” for the European aviation sector.

The Japanese (automotive) threat
In the 1980s Japan’s remarkable high-efficient, high-quality and cost-saving production sys-tems posed a serious competitive threat particularly to European carmakers, demanding to consequently revolutionize an outmoded, inflexible concept of Fordist mass production and domestic business orientation. Such a challenge pushed for i) radically adjusting and adapting to the overarching Japanese concept of “lean production”, and ii) boosting European integra-tion towards the 1992 Single Market. As the Japanese threat caused the industry to further internationalize and to renovate production and quality factors, the political sphere was again induced to obtain a European ‘critical mass’, also in order to overcome the stagnation of 1980s “Euroscepticism”. The fear to lose Europe’s “industry of industries” pushed the sector’s top-management and policy makers to learn from its main competitor and to catalyse global integration, which turned out to be a precondition for its further success in emerging markets up to this day. In other words, the above meant to gradually diversify Europe’s industrial foundations and to shift away from the formerly economies of scale towards economies of learning and (international) cooperation. However, the industry’s adjustment process in context to the Japanese threat did not exhibit homogeneously as it generated winners and losers in the automotive sector.

The ambiguities around China. A threat ‘in the making’
Since the 1990s, China’s incomparable economic development has been a mixed blessing for the European transport industry. On the one hand the transport industry was highly profiting from almost unequalled Chinese demand; but on the other hand its emancipating national industries are increasingly feared to become sophisticated competitors in the world markets. Thanks to continuing Chinese technology transfers, particularly the European rail sector al-ready can be declared to face a Chinese “threat”. However, perceptions about whether to declare China a threat or rather an opportunity can hardly be generalized as they are widely differing – not only from industrial sector to sector, but also from company to company. Gen-eral speaking, since the 1990s, the fear to lose European industrial structures (which was experienced through extensive offshoring and outsourcing, especially of low-skilled labour activities) generated a political impulse to promote cost advantages within the Eastern European sphere and has been securing efforts to further extend and restore a European ‘critical mass’. In this respect, the EU eastward enlargement in 2004, the efforts to create the European Single Sky, the Commission’s high ecological vehicle and product standards or the on-going harmonization of the rail market can be assumed correlating strongly with the rise of China’s competitiveness. Since the transport industry is still too much profiting from Chinese demand, the benefits so far offset possible rebound effects of rising competition. In this respect, China, compared to previous threat periods, cannot yet be considered a comprehensive menace but surely will evolve as such in the next years.


4. Transport demand trends
The world is increasingly aware of the challenges it faces, such as an ageing society and its intrinsic requirements, meeting the energy needs of the world by 2050 and feeding 9 billion people. Just by 2030, the world will need between 40% and 50% more fresh water, food and energy. A study by the World Wildlife Fund estimates that the total investment in urban infrastructures and operations up to 2050 will exceed a staggering $US 350 Trillion, requiring significant innovation in terms of funding and financing schemes to accomplish this huge undertaking.
By 2050, over ¾ of the population will be living in cities, with the most dynamic growth to be felt in thousands of smaller towns that will rapidly develop into cities. Demographics in the form of an ageing and declining population will confront Japan and a number of European countries with strong impedance to growth. A declining and ageing population over the next decades also means that a major source of China’s dynamism will disappear. At the same time, as it rapidly accumulates capital and upgrades its technology, the source of China’s comparative advantage could move in the direction of more capital-intensive and higher-value exports.
By contrast, India, some countries in the Middle East, Sub-Saharan Africa and others will enjoy favourable demographics over the next decades, and could become the fastest-growing parts of the world economy. For these labour-abundant developing economies, education policy will play a key role in determining workers’ skill sets, their chances of integrating into the labour force and their capacity to absorb new technology.
In world trade, the current main trends to be found are the rise of a number of emerging economies and the associated increase in their shares in world trade, the emergence of international supply chains, the rise of new forms of regionalism, the growth of trade in services and increased linkages between trade in goods and trade in services. Other relevant factors are higher and increasingly volatile commodity prices and growing public concerns regarding the social and environmental effects of trade.
Physical capital accumulation (in transport infrastructures, machinery, telecommunications, power generation, energy distribution or water provision) play a crucial role in lowering pro-duction and transaction costs, increasing a country’s capacity to produce capital-intensive outputs and facilitates a country’s participation in world trade. Developments in the transport sector – infrastructure, fuel prices, innovation and regulation – will also impact the costs of trade and the global organization of production. These investments may even affect the nature of trade as, over time and depending on the relative rates of growth of capital accumulation versus labour force, it is possible to change a country’s competitive advantage.
The next table, retrieved from Race 2050s’ deliverable D5.1 presents the expected evolution of global demand for Transport in the medium term, according to various foresight studies on the Transport sector.

Table 1 – Expected evolution of transport demand by mode by different sources (index 100 = 2010)


These values represent a high level view on what current foresight studies indicate for future Transport demand growth. This range of figures set out clearly that current expectations for demand growth are of a very significant increase over the next 3 to 4 decades, to which Transport planners and industry players must envisage the best strategies to cope with.


5. EU transport industry trends
The transport sector has to face challenges related to a fundamental change of global frame conditions. A shift in demand and economic power towards Asia and emerging economies is expected to challenge the European transport sector, not only through new competitors, but through the need to redesign business strategies, products and services according to the changing landscape. The change itself comes with uncertainty concerning quality, strength and direction of the trends. Effects on the European transportation industries’ competitiveness will mainly depend on the capability of adapting to changes and proactively shaping the development. Energy scarcity, climate change and the need to react to both will be the main influencing aspects of future frame conditions for transportation. This is where political regulation is crucial – especially in ensuring regulations to address the negative effects of transportation such as emissions and energy consumption on a global scale – also supporting market access and technological standards.
Based on strengths of the European transport industries such as established market position, high quality of products and level of innovation, opportunities are expected to arise in providing new solutions requested by the changing situation. Threats may arise due to increased competition, the need to react more flexibly and to change perspectives on markets and product development.
Besides observable trends, uncertainty of the future has been taken into account by using wild cards which might affect transportation. All the scenarios available forecast a constant development of the transport market, both in passengers and freight volumes, to a ratio bigger than the global GDP expected growth, although this trend is challenged by new social behaviours. The industries landscape is changing in all the sub-sectors: vertical and horizontal integrations and creation of European big players are the main current trends, a tendency which is not ended yet.

Service industry
Although benefiting from growing volumes, the whole European transport service industry nevertheless presents poor financial results and difficult market conditions. Thus, the need for a radical new shape of the business (as proposed for the shipping industry), a different approach to customers’ behaviours (as for the private land mobility) and, more generally, an end-to-end offer needs to be addressed. Environmental awareness has spread more and more, and is considered not a burden but a potential selling point; higher energy prices are affecting rather strongly the sectors’ economic sustainability, thus pushing to energy saving strategies.
About the EU-27, it is, all together, a mature market. However, the present scenarios forecast increasing freight volumes for the next decades, although lower than the emerging economies.
The European inland logistic and freight industry is largely based on road transport, with minor share for the rail and inland waterborne modes. The logistic services have experienced poor financial results and – in some branches – low performance. For this and other reasons, the sector has experienced relevant changes in the past decades, still on-going, namely vertical integration and the great development of continental big players, not only in the rail sector.
The industry – in its new shape – is taking its first step towards new business models, which must consider the relevant challenges of the logistic system, well beyond the container revolution.
EU passenger transport is dominated by private mass motorisation (more than 70% of the total market), followed by aviation, coaches and rail services. As with freight service, the passenger transport industry’s financial results remain feeble, while the performances can be increased. Airlines and railway industries, both very capital-intensive, are dominated by large companies, while road sectors (taxis, coaches and buses) present a more fragmented situation. However, a trend towards big international alliances and/or European players, combined with a stronger vertical integration is already running. All the stakeholders are aware of the industry challenges, above all a wider customer satisfaction and tighter multi-modal integration.

Manufacturing industry
As for services, growth of the global market is also expected in the manufacturing industry. Although truly internationalised, the transport manufacturing industry is usually close to the markets served, which has pushed many EU companies to open plants and assembly sites in emerging economies. Considering the role of those new markets, the leadership position of the European industry is challenged by new entrants, which enjoy a fast growing home market, lower technological gaps and lower final costs.
The automobile and the railway sectors are the most exposed to international competition, in which emerging economies’ companies are playing a more relevant role. The high-tech segment and – for the car industry – the premium sub-market are less vulnerable to this trend.
The aviation sector is still a duopoly dominated by Boeing and Airbus, but four non-EU companies will be stepping into the market in the next years, thus giving a new configuration to the industry.
The current studies and the industry stakeholders suggest focusing on top-end segments, R&D development and cutting edge technologies as winning strategies for the EU players.
While mature economies are saturated markets and seem to have experienced their peak in car ownership, emerging economies have increasingly skyrocketing growth, mainly fed by local plants.
In this vein, the European car industry is witnessing a turning point in its history. The decline of its traditional market and, abroad, the growing pressure of ´local´ producers create an im-mense stress on the EU OEMs and on their suppliers. As happened for the EU shipping indus-try, a shift towards the ´premium´ segment, cutting-edge technologies, technical and non-technical innovations are often envisioned as the next stage for the EU car producers.
The shipbuilding industry is a globalized marketplace dominated by Asian yards: China, South Korea and Japan together hold over 80% of global completions between 2005 and 2012.
European shipyards still hold a strong position in some high-tech and high-value added niche markets, like Cruise vessels, Dredgers, some offshore support vessels and yachting. Further-more, the European marine equipment industry is home to some of the most successful players globally, and a main driver for innovation in the industry.
The research and innovation capabilities of the European industry places it in a good position to take advantage of the opportunities that lie ahead, like the greening of the fleet, deep-sea exploitation and offshore renewable energies – like wind or waves – where European players are in the forefront in technological terms. But its current competitive position is threatened by the lack of financing, ageing workforce and shortage of skills. Increased competition from dominant and emerging markets alike – as oversupply in some markets are pulling capacity between market sectors and innovation is quickly taken by others, and as intellectual property rights are complicated to enforce at a global level – requiring a steady pace of R&D just to keep a step ahead of competition.
The rail equipment industry not only ‘successfully’ navigated through the downturn of the past years, but the scenarios available describe a sound development for this sector. Additionally, the EU rail industry appears to be conscious of the challenges to be tackled. The role of the European industry is indeed challenged by fast growing Asian firms which can harm the European leading position. Besides R&D, innovative business models and original (and even extreme) new strategies are claimed as essential. In terms of markets trends, Asia will experience a slowdown of its astonishing expansion (unless a new wave of investment is unleashed in China and India), but other markets could become attractive (Africa, next-11, Americas, Russia). Urbanisation will be another driving force.
The Aerospace Industry is expected to thrive during the next thirty years supported by increasing levels of air travel demand, mainly from emergent economies, and improved air traffic management operability. Main drivers for future technological development should continue to be energy efficiency and environmental sustainability. With a global leading role in Large Commercial aircrafts’ and helicopters’ final assembly and marketing (mainly due to successful consolidation efforts in the past), the European Aerospace Industry holds a strong competitive position in the global market place for major components and subsystems supply, second to North American counterparts. The main threats to the European Aerospace Industry’s future competitiveness lie in its ability to further consolidate into innovation-driven conglomerates, capable of establishing risk-sharing partnerships with main OEMs for product development, and on new commercial product assembly competitors arising from countries like BRIIC, Canada, and Japan, whose impact on future market distribution can already be noticed.

Technology innovation and market challenges
A competitive transportation sector provides the basis for sustainable socio-economic devel-opment in Europe. Global market trends are challenging the system by structural changes, such as on-going internationalization, especially in services, privatization in the transport sec-tor and investments in infrastructure, as well as a global shift of demand towards upcoming economies. Beside this, the global market development is also driven by policy and regulation influencing the openness of markets. This is especially important in transportation, which is characterized by a history of state owned infrastructure and providers.
On the regulation side different strategies in export, restrictions of resources, tax policy for imports and requirements of locating the companies production, to name only a few, may transform frame conditions, as economic and political power is also shifting towards east and south. In this complex system with global linked policies and economics, the European trans-portation industry has a competitive advantage in its strong base of innovative R&D, produc-tion and global exports. The challenge will be to improve adaptability skills meeting the needs of a new world of transportation, which will be formed by needs and demand from emerging countries more than in previous decades. This need for adaption and transformation includes the opportunity for innovation. The key issue for ensuring competitiveness will be to under-stand different perspectives and follow new approaches.
Energy issues will become more and more central in the future. The transportation sector is still heavily dependent on fossil fuels and its price development. It is highly possible that there will be a rise in the real price of energy in the coming decades. In the near future the use of fossil fuels in transportation will increase, despite programs and guidelines for energy efficiency and a reduction of emissions. There are challenges and opportunities concerning this topic. A lot of countries deal with the challenge of energy security and develop strategies to become more independent of the fluctuating energy price. This also affects future developments in the transportation sector and is therefore a topic of global interest.
Novel materials with improved properties are a prerequisite for more sustainable, efficient and environmentally friendly transportation means. The transportation industries have already begun to utilize advanced materials such as nano-materials, for specific applications. Advancements in materials science and especially in nano-technology offer new possibilities for a wide range of structural and (multi)functional nano-materials with unprecedented properties. For example, certain nano-composites as well as nano-engineered metals have the potential to significantly reduce the weight of aerospace, automotive and naval structures. In this sub-chapter several interesting and important application areas are reviewed, such as high-strength light-weight materials for vehicle structures and engines, self-healing materials and sophisticated coatings, materials enabling high performance power sources, smart materials for adaptive structures, and materials for improved transportation infrastructures.
ICT products are crucial to the transportation industry. For example, in today's cars there are up to 100 microcomputer-based systems called Electronic Control Units (ECUs).
In this sub-chapter we cover existing and emerging technologies that could re-shape the transport industry. We briefly discuss automotive embedded systems, telematics and intelli-gent transport systems, the connected car and Internet of Things, autonomous vehicle tech-nology and multi-modal transport systems.
The advancement of ICTs is also related to the effective exploitation of alternative engines. Gas and diesel engines will improve mostly due to electronics advances. ICTs will also impact driver assistance systems, including warning systems, error correction, and collision mitigation. The EU has competitive advantages in some areas, such as core Auto ECUs, and Advanced Driver Assist Systems (ADAS). In the area of Electric Vehicle ECUs, the EU is less competitive and needs to do more to stay in the game.
There is no doubt that energy is one of the key issues humanity will have to deal with in the next few decades. An increasingly large fraction of the world use of energy is consumed by transportation. It is supplied mostly by the use of fossil fuels, which are found in limited amounts and are exposed to many various factors (geographical, geopolitical, etc.) limiting their distribution worldwide.
The transportation sector needs to find alternatives, preferably renewable ones, to fossil fuel consumption. In this sub-chapter we briefly review the various alternatives, including hydrogen fuel cells, electric batteries, hybrid engines and bio-diesel. Each is described in some detail, and the sub-chapter ends with a review of various reports concerning the future of usage of the above renewable fuels.

New trends
Globally, concerning integration, customisation and internationalisation the transport industry is facing three trends.
1. While out-sourcing and de-localisation of the supply chain will receive further development, some EU production clusters are showing a strong resilience, and they are truly competitive in the global market. This can lead to more internationalised production system, in which some EU segments can offer first-class products with cutting-edge technological innovations. Vertical and horizontal integration, alliance and joint ventures are expected to remain one way to face a more internationalised market.
2. The traditional borders among transport sub-sectors are crumbling, and more and more companies are developing new initiatives well beyond their core business. The race to offer end-to-end travel service is already open and many companies are stepping in. This is pushing, for instance, Deutsche Bahn to have in its portfolio car and bike-sharing, Daimler is involved in car pooling and car sharing, while Bombardier produces electric buses.
3. In mature economies motor-vehicles ownership is declining, especially among young generation. In such a new market landscape, the industries are already developing new offers and new ideas to meet customers’ requests. The ability to cope to this rising trend can be useful also in emerging (and urbanised) economies, where space, energy and pollution issues can force to a limited access to car ownership (as currently in several Chinese cities).

While traditional vertical and horizontal integration are still on the agenda of the transport industry, new forms of competition and integration have been detected. Globally, the whole transport demand will grow, and further international alliances (or consolidations) will be required in order to cope with the economies of scale and scope requested by this new market outline. Still, relevant differences occur between mature and emerging economies: generally speaking, the latter are showing a growing demand for motorized mobility and vehicle ownership, while the first are declining markets.
Transport companies (both manufacturing and services ones) are not just developing their core business, but are offering a wider range of services, implementing innovating forms of collaboration, and breaking the traditional bounders among sub-sectors. Infrastructural con-straints, environmental concerns and energy costs are (and, presumably, will be) the driving factors of this process.
In mature economies, the younger generations display a greater interest in shared-economy, while new attitudes induce decreasing ownership of private vehicles. Time-budget and/or money-budget constraints are leading the new mobility behaviours, and forcing the industry to implement new partnership, joint ventures and other form of collaboration able to match those changed demands. Generally speaking, the transport industry landscape keeps its traditional core business, but it is quickly shifting to new concepts, from vehicle ownership to integrated mobility services.
This new approach could have relevant outcomes also in emerging countries, where the urbanisation process and the density of city (plus energy and pollution factors) could discourage mass motorisation and develop post-ownership attitudes.


6. Framework condition and future policies
Derived from the described challenges, recommendations for policy and planning supporting the competitiveness of the European transport industry are formulated. Their aim is to enable the transport sector to realizing opportunities coming along with the transformation process in global transport, as well as to avoid threats arising with risks related to the ongoing changes.

o Adaptation towards changing frame conditions challenges policy makers as they need to support flexibility and guarantee a sufficient legal certainty so that the businesses can make strategic decisions and undertake important investments at the same time. In fact, one of the challenges of policy-making is to strike a balance between demands for certainty and rapid adaptation to economic and political dynamics within and outside the EU, in addition to being capable of adjusting policies and their measures to unexpected or emerging new signals. To assure certainty, it will be essential to adopt long-term rather than short and/or medium terms perspective. However, it could be that there are unexpected events. The internalisation of socio-environmental costs into prices of vehicles and/or other transport modes may seem discriminatory in the short-term. Yet, pricing schemes that truly reflect the external costs of transport industry can help to quickly adapt to socio-environmental requirements, and remain competitive in the long term.

o Challenges arising from the environmental trends such as climate change are not only related to the need of finding substitutes for fossil energy, cope with extreme weather events and the risk of taking action too late, but also to developing the right strategy within the global context. The Chinese efforts and industry support of renewables might strengthen their global competitiveness, while Europe might lag behind. According to the democracy-based system, Europe would need to push for new energies by subsidies and regulations. Both measures imply the risk of weakening transport industries competitiveness, due to creating non-competitive, governmental depending industries and/or increasing burdens for industries by regulations. Balanced political measures taking global developments into consideration need to be developed. To tackle environmental issues, the implementation of the climate-change adaptation policy must take place in a highly coordinated fashion. Failing to do so will harm both the public and the private sectors by asymmetrically exposing both 1) the transport industry towards global competition and 2) the different parts of European Union to higher risks related to natural hazards.

o Among the measures supporting opportunities related to environmental, social and economic sustainability, we find the cross-border procurement policy that is instru-mental in proliferation of innovations, Corporate Social Responsibility (CSR), aid and cooperation policy, cross-industry cooperation platforms and other informal policy measures. If administrative procedures of cross-border procurement can be stand-ardized and become less burdensome, they can benefit businesses, and especially the SMEs. CSR policies, if properly implemented, may engage the private sector to attend to social needs, promote a value-adding culture, both in Europe and abroad, and increase business competitiveness in sustainable ways. International cooperation policies facilitating development rather than providing aid can open new opportunities for the European transport industry. By facilitating access to markets that want to develop sustainable transportation, these policies may augment demand for environmentally responsible network investments, clean vehicles, airplanes and other eco-friendly means of locomotion.

o The global shift of demand is accompanied by a dynamic movement of economic and political power mainly towards Asia. New trends in mobility and transport demand are causing a fundamental change of the market and a transformation of the system. Policy needs to support and also to create awareness of the change as a fundamental system transformation causing a need not only to react to it, but also to develop strategies to shape the development. The traditional borders among transport sub-sectors are crumbling, and more and more companies are developing new initiatives well beyond their core business. A broader perspective going beyond transporting passengers and goods based on a certain mode from one to another location has to be developed; mobility has to be dealt with as an active movement combining different modes in a flexible and efficient way and to consider markets in a system perspective.

o The regional shift of economic and trade growth will also change the landscape of main trade partners and where key participants of supply chains may be located. The European transport industry and policy need to pay attention to development in a broad range of regions. Adding to the complexity trends, such as the increasingly cross-continental supply chains, which serve a multitude of international markets, the issues of global environmental concerns and the international security threats, which underscore the significant challenges that face the European policy makers, need to be addressed. This encompasses the fact that that being able to cooperate internationally and promote the uptake of formal commitments through global political arenas may help European businesses to capitalize on new opportunities and refrain from exposure to new threats.

o Although benefiting from growing volumes, the whole European transport service in-dustry nevertheless presents poor financial results and difficult market conditions. Thus, the need for a radical new shape of the business, a different approach to cus-tomers’ behaviours and, more generally, an end-to-end offer need to be addressed. Mainstreaming can unlock new ways to make communities, infrastructure, and gov-ernments and businesses more resilient and open new market opportunities for resilience-enhancing products, services and systems. Support of innovation activities, addressing process, products and business models, as well as optimizing frame condi-tions for R&D, are political issue to address. Ttrade agreements are necessary to en-sure access to demand markets and global supply chains, which are not yet in place with some of the major future players, such as India and Brazil.

o While out-sourcing and de-localisation of the supply chain will have to be further de-veloped, some EU production clusters are showing a strong resilience, and they are truly competitive in the global market. This can lead to a more internationalised pro-duction system, in which some EU segments can offer first-class products with cutting-edge technological innovations. Vertical and horizontal integration, alliance and joint ventures are expected to remain one way to face a more internationalised market. A supporting legal framework is essential to ensure global safe business environments; additionally, standards for safety and environmental issues need to be addressed on an international level.

o High-quality level and technological innovation – in safety, energy efficiency – includ-ing quality skills and technological know-how, is a main opportunity for the European transport industry. A long history in terms of transport manufacturing created know-how which is highly demanded worldwide. To continue this path requires overcoming one’s own perspective of a comfortable position in global terms and to challenge one’s own perspectives and businesses on a daily basis.

o To tackle intra-European issues supporting the transport sector, measures in different fields such as transport, land use and economy have to be integrated into development plans, including sets of measures addressing socio-economic development and transportation with their linkages. In order to do so, not only a context perspective would have to be developed, but also integrated systemic solutions.

o These solutions should lead to a convenient, affordable and safe transport supply to the masses and might provide solutions creating a window of opportunity to providers and operators of mass transit systems worldwide – increasing international competitiveness. The example points to a general problem: challenges come along with opportunities for certain industries, while limiting increase of sales for others. Policy will need to consider industry development related to mode-shift in order to find solutions to set frame conditions for an economic transition process in transport, leading to win-lose situations.

Especially new business opportunities and threats due to market shifts need to be identified – related to well-known trends or events of low-likelihood, known as wild cards. The latter point to potentially critical fields like Europe-wide traffic control, electric road transport, decrease of passenger transportation or autonomous vehicles, which would not only change the competitive landscape, but also increase uncertainty due to ambiguous effects for different transportation industries. As regulations, political innovation support and investments are crucial for the implementation of many of the mentioned trends and wild cards, potential effects on different industries as well as their interdependencies should be taken into account.


7. Strategic long term directions
The current state of European economy with high unemployment, scarcity of public and pri-vate investments, considerable infrastructure wear and tear and high public debt necessitates more compelling and courageous policy interventions to re-store the EU production to pre-crisis level, reduce the number of people living on social benefits, and re-direct them to work.
The European policy makers may need to consider global trends and global competition when designing European competitiveness and industry development policies. Despite the fact that it is difficult to spot many emerging shifts, forecast new trends and types of impacts precisely, European policy makers could read these circumstances as opportunity to use the EU economic power and geopolitical might to design and implement policies that will influence global reality in line with the EU socio-environmental values and interests. It must be admitted that exactly this stance the EU has adopted in influencing the long-term global standards for environmental sustainability of motor vehicles, sea-going vessels, and aviation. Thus, policy makers in other policy sectors may also need to become more pro-active and influence future business conditions rather than responding to past events and consequences.
To this end, the European decision maker together with national partners may design new legislations, policies and strategies, which utilize the underlying economic and geopolitical developments for long-term benefits of European transport-equipment manufacturing and service provision industries, and their auxiliary and input providing networks. By so doing the new legislations, policy instruments and financial vehicles may unlock new opportunities and enhance the likelihood of capitalizing on new openings. Such propositions need to be devised ahead in time and tested under contextual conditions of the different member states. This entails that effectiveness of different sector policy measures will be empirically-verified at different stages of their legislative life before a given law is formally accepted, launched and implemented. For assessing the different forms of policy adoption in various settings, several regionally adjusted benchmarking systems need to be developed. In this way, the risk of unintended or even unwanted policy impacts may be reduced and the overall policy effectiveness enhanced. This procedure may also increase the level of social trust in European and national policy makers’ capabilities to deal with important social and/or strategic problems, forestall global threats, and sustain social welfare.
However, one has also to admit that the traditional top-down making of European policy has lost its social acceptance and functional effectiveness. Thus, in order to implant their work more firmly “on the ground”, the European policy makers may need to broader their social outreach in formulating and testing policy proposals. Also needs for compromises between policies promoting economic growth, social cohesion, energy security, and environmental sustainability need to be acknowledged in order to minimize adversary outcomes. Again, a broader participation of voting public in policy design and adoption will enhance transparency, legitimize policy development, and facilitate adoption.
In addition, one needs to reconsider the usefulness of single sector policy making due to social, political and technical interactions between the different policy fields and instruments, and emergence of unintended distributional outcomes. Instead, more research on multi-sector policy design and implementation paths with flexible enforcement and monitoring tools may be needed to adjust policy effectuation to unexpected circumstances in various socio-political contexts and/or events.
Furthermore, in order to preempt the problems with policy implementation and attainment of strategic goals, the European policy makers may proactively identify the possible gainers and losers. More research is required on how to avoid social inequality, loss of social cohesion and asymmetric burden distribution between social groups in different countries. An effective dealing with these risks may enhance policy legitimacy and social backing.
Other issues such as the establishment of single energy market may require due to its com-plexity, additional research on possible distribution of costs and gains between the member states. The lack of common energy policy and a single energy market may also impede the uptake of electric mobility across the EU thus reducing diversification opportunities in transport industry. As a result, the use and sales of electric vehicles could be constrained. Furthermore, the high-level uncertainty related to market acceptance and penetration of new energy sources (biofuels, hydrogen, fuel cells) may hamper private investments and undermine long-term competitiveness of European transport industry. In addition, the current drop in fossil fuel prices could delay diversification of European vehicle manufacturing and mobility supplying industry. It may also boost the competitive standing of European petrol-driven vehicles and vessels in price-sensitive markets.

Specific recommendations
Policy recommendations in this section span across the different transport modes, markets and the broader business and institutional environments. They encompass suggestions, advices and ideas
for short- and medium-term actions, strategies and undertakings. More specifically, they emphasize the needs for
• Support the upgrade and acquisition of new skills by the currently unemployed and invest in education and skill building programs, which meet the industry current and future needs;
• Introduce fair fiscal principles for redistribution of policy implementation costs and benefits;
• Sustain focus on R&D and support innovation; find new ways to overcome shortage of public means and attract private investment. Especially, enhance private sector spending on R&D, and productive investments that will increase employment and generate economic growth;
• Increase awareness of environmental and social justice; disseminate information on sustainable mobility and support sustainable transport investments; restore social trust in road charging benefits;
• Increase social awareness of security risks to enhance the citizen and business willingness to pay for security investments;
• Work towards standardization and harmonization of national taxation schemes; regu-lations of related to ICT and devices, data protection, transport management regimes, documentation, and infrastructure charges;
• Develop policy supporting digitalization while at the same time do not compromise safety and security standards;
• Remove market access barriers and strengthen the international trade policy frame-work;
• Increase cross-border public procurement and support participation of SMEs;
• Integrate sustainability principles into public procurement and urban development;
• Punish counterfeiting, piracy, unfair competition and corruption in public and private sectors;
• Disseminate knowledge of European platforms and open participation to more busi-ness;
• Reduce red tape of European schemes and taxation burden, particularly on SMEs;
• Facilitate technology transfer between SMEs and multinationals;
• Support regulatory stability and predictability of public policy;
• Promote adoption of CSR and encourage good environmental management in business and industry;
• Increase global awareness and knowledge of foreign markets (institutional and cultural characteristics);
• Promote professional networking, knowledge sharing and joint investments between European and foreign businesses and investors;
• Increase efficiency of IPR legislation (clear, easy, pays off).


8. RACE2050 scenarios
RACE2050 prepared six scenarios on the future of the European transportation industry. De-veloped by the project team and written by the futurist Karlheinz Steinmüller, these scenarios depict different, rather extreme futures for the time horizons 2030 and 2050. For 2030, the project team decided to develop predominantly pessimistic and cautionary visions, based on an extrapolation of existing negative trends (“Dark scenarios”) and on the historical conviction that negative or horror scenarios successfully triggered adaptation and development processes within the European transportation industries. On the contrary, the 2050 visions combine positive answers to existing challenges with optimistic assumptions about a deep transformation of the industry based in particular on cultural changes (“Bright scenarios”).
For both time horizons, a main scenario is accompanied by two less comprehensive “side-scenarios” that highlight specific developments and that can be understood as more extreme alternatives to the main scenario.



Scenarios are a wonderful tool to inspire discussions about the future, about advantages and disadvantages of present developments and about strategies. But, in using scenarios, one should keep certain facts in mind:
Scenarios are scenarios, stories about the future, not forecasts. Their aim is to provide insights about potential futures; they do not and cannot depict “the future” as it will be. As consistent and plausible images of possible futures, they say: “This is the way it could happen.” But even if you have a set of alternative scenarios to a certain topic, the future will never look exactly like one of the scenarios. No one, no scenario writer, no futurist or other expert, can foresee all emerging developments, all possible innovations or wild cards. And there are always unknown unknowns.
This limitation, however, does not diminish the value of scenarios. Scenarios transport specific messages about the future, and one can learn from the narratives of the scenarios. They inspire thinking about the future, they encourage mental experiments, and they can contribute to debates about the future, and, hopefully, lead to better decisions.
Most scenarios exaggerate present developments for the sake of clearer, more distinct images, a sharper perception of present trends, innovations or policies. Smooth and conventional images of the future are of no help, anyway. On the contrary, scenarios may be regarded as mental experiments that draw conclusions from a set of premises: “What if…?” “What if this goes on?” “What if a certain disruption happens?” Counter-factual premises or assumptions that run against commonly shared convictions inspire open “out of the box” thinking. Scenario studies should make conventional convictions transparent – and perhaps show how shaky they are.
Scenarios may be used in quite different ways: to stimulate thinking about the future, to initiate a debate, to test the robustness of strategies, or to support decision-making. For a first encounter with scenarios, the reader may ask:
• What is intriguing about the scenario?
• What makes the scenario plausible, realistic? Which elements of the scenario are implausible or utopian?
• Does the scenario extrapolate present trends and developments – or deviate from them? And if this is the case: in which points?
• How do the main actors in the scenario act? According to their present strategies? Or do they implement alternative strategies?
• Who are the winners and the losers in the scenario?
• Which aspects of the scenario are desirable from my point of view? Which ones are not?
Scenarios do not provide answers about the future. But they can help us to pose better questions.


Dark SCENARIO: A Cautionary Vision

The Scenario in a Nutshell
In 2030 Europe has fully hit rock bottom of the “end of mobility”, defining a continent com-pletely surprised by the overwhelming economic success of competitive emerging markets, facing rising energy constraints as well as substantial internal shifts in mobility concepts and behaviour patterns. Having missed the opportunity to adapt business models and technologi-cal solutions to new energy supply impediments and new mobility patterns, the European transport industry in 2030, also due to massive decline of public investment, consequently has lost the technological pole position, which for the industry had been traditionally based on the presence of strong domestic demand and on an effective continental market providing a “critical mass”.
In 2030, as a result of public financial constraints, the EU will experience deteriorating quality of infrastructural systems, and a consequently shrinking (and eventually collap-sing) transport industry. 2030 will experience dramatically lower mobility due to dramatically lower incomes, reflected in a wide-spread public consensus to reduce (or even avoid) mobility. Beyond that, the transport industry faces a “demographic shock” of having acknowledged the ageing society too late, and therefore lacking an adequate workforce.
On the political side, the long-lasting tensions since the financial crisis and the mis-management of coordinated political solutions lead to reinforced nationalism, polarization and infrastructural “corridorization”, causing a disintegration of peripheral areas and therefore of major parts of European transport systems.
Prior to 2030, reliance on technology has been the overestimated key factor for (sustainable) change: but 2030, however, marks the point of ultimate disillusion, caused by the amount of unfulfilled technological expectations. Instead, the emerging economies appear to be better prepared to cope with the changeover into a post-fossil era, while the European transport industry, despite ambitious high-tech aspirations, basically followed business-as-usual imple-mentations and inadequate business models. Ever-rising R&D spending and a technocratic perception of European progress have on the one hand lowered the ability to finance more conducive approaches, like low-tech and low-cost implementations. On the other hand, the plenitude of existing technical solutions is lacking political implementation and remains un-used.


Bright SCENARIO: An Optimistic Vision

The Scenario in a Nutshell
In 2050 the European transport industry has successfully learnt the lesson from the “End of Mobility” by having established a functioning paradigm of (socially and environmentally) sus-tainable mobility, represented in the term of the “New Normal”. The consolidation of 2030 mobility attitudes as well as political decision-making not only reflect a full awareness of facing the dusk of the fossil fuel era, but, broadly, they reflect the arrival at a new sense of mobility. Due to long-lasting political and energy constraints, Europe has finally conceived how to cope with problematic frame conditions through cutting-edge policies and highly adaptive business models as well as with better fitting technological devices.
While around the same time the previously booming emerging countries are starting to face similar constraints as experienced by Europe in 2030, the European transport sector appears to have gained a competitive advantage in having dealt longer than others with the problems of resource scarcity, declining public investment, or ageing population. The European transport industries, having successfully found innovative and service-driven business models, sensibly addresses the dominating framework conditions such as shared economy or decreasing mobility, are able to provide well-proven equipment and service solutions to other parts of the world. This long-lasting experience of finding the right business models (e.g. selling services not only products, overcrossing transport modes, carefully listening to the customers), which turned out to be more important than high-tech solutions, in 2050 becomes Europe’s precondition for showing the best position to fill the expectations of the emerging world’s adjusting sustainable mobility paradigm. Therefore, intelligent ICT networks will not become an end in itself, but will unleash, support and simplify Europe’s transport solutions. Hence, Europe is again able to position itself as the world leader, combining a creative and innovative mind-set with tailored technological solutions and adaptive business awareness balanced by appropriate supra-national EU intervention.
Consequently, Europe in 2050, having learnt how to deal with the previous depression and having created a strong service-oriented transport landscape, has become the world’s new benchmark for sustainable transport.


9. RACE2050 Synopsis tool
One of RACE2050’s key ideas was not just to add another foresight study to an already exten-sive library of future studies in the transport field, but to integrate and visualize the tremen-dous foresight intelligence in a comparative synopsis with the aim of identifying and comparing the many different assessments and estimations about the key factors that are assumed to shape the future competitiveness of the transport industry.
Therefore, RACE2050 developed the Transport Synopsis Tool, a free online platform that for the first time enables industry stakeholders, policy makers and the wider public to access a comparative analysis of a magnitude of almost 100 future studies concerning the European transport industry. Based on an extensive review of these studies, the RACE2050 project team evaluated the study’s assessments regarding their assumed relative importance of a range of 15 predefined competitiveness parameters. The review of such pertinent transport future studies and future industry scenarios comprised the investigation of seven primary and eight secondary parameters that could be evaluated on a scale from 1 (“Extremely relevant” issue for the industry and/or the market, positively or negatively”) to 4 (“Competitiveness factor was not mentioned at all”). These parameters are not chosen randomly, but are based on RACE2050’s enduring substruction of the most crucial competitiveness parameters out of dozens of future studies as well as on the World Economic Forum’s (WEF) global competitiveness reports. These assessments fed a database that finally formed the core of the Transport Synopsis Tool and enables serious, informative and playful interaction.
With the aid of clear visualizations and individual search options, dozens of otherwise isolated future studies and scenarios from 11 industry segments are integrated into a comparative tool, facilitating the identification of key success factors for a sustainable growth of the European transport industries, which can increase its strength in a long perspective up to 2050.

Visualizations of reviews are offered either in a “Radar” or a “Bar Chart” modus.


As this tool is not only intended to illustrate (contradictory) paths for future growth of the sector, the Transport Synopsis Tool is also developed to grow itself. Designed with the idea of an open network character, the tool strongly encourages the possibility to add new reviews of fresh future studies or scenarios to the platform in order to let it grow gradually.
The Transport Synopsis Tool aims at both informing the transport industry community by highlighting key factors for competitiveness as well as to facilitate the discussion among experts from transport industry, research, policy and foresight experts. In this vein, this tool, which was for the first time presented to the public at the InnoTrans trade fair Berlin in September 2014, will persist as a legacy well after the end of this project, and, beyond that, is developed to implement continuous extensions and amendments to let it become one of the leading European future platforms in the transport realm.
http://www.transport-synopsis.eu


10. Wild card
RACE2050 is a research project co-funded by European Commission within the 7-th Framework Programme (FP7), aiming at novel scenarios for 2030 and 2050 about alternative futures of the European transportation industries. The main objective was to consider potentially surprising and disruptive future events or developments, which may challenge the "conventional wisdom" and thereby may enrich the thinking process towards the scenarios construction.
Wild cards are potential future events with low likelihood of occurrence (at least as currently perceived by most people) but with high impact if they occur. Weak signals are slight changes in the current state of affairs or in existing trends that – if observed and correctly interpreted – may hint a growing likelihood of occurrence of a certain wild card. Researchers have stressed the importance of the wild cards approach to counter the tendency of decision makers to deny the possibility of major surprises. The growing interest in wild cards and weak signals has been reflected in several studies and publications in recent years, notably in the EU FP7 project iKNOW.
The collection and elicitation of a wide range of relevant wild cards and weak signals was car-ried out by scanning of selected publications, in-depth interviews with subject matter experts and brainstorming sessions with the participation of members of the project team and external experts.
Based on the results of these activities, which are presented in detail in this report, the following fourteen wild cards (of different types: technological, geopolitical, societal/behavioral) were selected for a subsequent analysis by means of an online expert survey.
1. The Emergence of Drones
2. Drastic Decrease in Freight Transportation
3. Drastic Decrease in Passenger Transportation
4. Energy Abundance
5. Europe-Wide Traffic-Control System
6. Flying cars, at last!
7. Total Cessation of Economic Relations between the US and the EU
8. Autonomous Ground Vehicles Widely Used
9. Mass Migration of People
10. Lightweight Self-Healing Materials Revolutionize Vehicles
11. All-Electric Road Transportation, Based on Renewable Energy
12. Superfast Ground Transportation
13. Slow Travel / Slow Logistics
14. Massive Abandonment of ICT-based Systems

281 experts actively participated in the survey. For each wild card participants submitted their views on several important aspects: the likelihood of occurrence in different time-frames, the impact on different industry segments (including the time till full impact is reached), the breadth of the effect (from local to global), the vulnerability of each industry sector to the event, and the importance for decision makers to prepare. Finally, participants submitted their ideas regarding weak signals that may hint at a growing likelihood of each wild card.
All the wild cards examined in the survey were found relevant by the experts, in terms of their potential impact on the transportation industries, the breadth of their effect and the vulnerability of the various industry segments. Most will have "high" or "very high" impact on at least one industry segment, if they occur. Only for two wild cards the fullest impact (on at least one industry segment) is "medium". The time till the full impact is reached varies among the wild cards.
The likelihood of the wild cards occurrence at present or in the near term (before 2020) is perceived as very low or low – corresponding to the formal definition of wild card. However, the occurrence likelihood of most of the wild cards rises with time, and some of them reach high likelihood in 2040 or beyond.


Potential Impact:
1. Dissemination
Dissemination has been one of the main targets of the project.
In the life time of the project the researchers have presented the outcomes of the research at the meeting as listed in this form. Those activities varied form research milieus to industry and policy makers’ arenas.

2. Essays and other publications
The first outcomes of the project have been presented to national and international conferences, as oral presentations and written papers, though just one of them, so far, has been published in the proceeding. One article has been published in a not-peer review journal (“Projektbericht RACE2050. Entwicklung einer innovativen und verantwortungsvollen Agenda für die Wettbewerbsfähigkeit der europäischen Transportindustrie bis 2050“ [RACE2050. Responsible innovation Agenda for Competitive European transport industries up to 2050], Zeitschrift für Zukunftsforschung, 2004 - 3/1, 48-60(22), H.-L. Dienel, R. Kellermann, M. Moraglio), but it is not possible to insert it in the form.

In the incoming months, the research team is expecting to have further outcomes.
More particularly:
• 2015 (forthcoming). Guest editors of the special issue on “The Future of Transport in Europe”, European Journal of Futures Research, M. Moraglio and H.-L. Dienel
• 2016 (forthcoming). “Didactical functions of dark and bright scenarios: Learning from past scenarios for the European transport industry”, in Envisioning Uncertain Futures. Experiences With Scenarios from a Security Perspective, Springer VS, M. Moraglio, H.-L. Dienel and R. Kellermann
• 2016 (forthcoming). “Travelling or Communicating? The False Dilemma of Mobility. Questions about a marginalized issue”, in Peripheral flows: Mobilities between core(s) and fringe(s) in a historical perspective, Cambridge Scholars Publishing
• 2015 (forthcoming). “Wild Cards in Transportation”, European Journal of Futures Research, Aharon Hauptman and Yoel Raban, Merja Hoppe


3. The synopsis tool
One of RACE2050’s key ideas was not just to add another foresight study to an already extensive library of future studies in the transport field, but to integrate and visualize the tremendous foresight intelligence in a comparative synopsis with the aim of identifying and comparing the many different assessments and estimations about the key factors that are assumed to shape the future competitiveness of the transport industry.
Therefore, RACE2050 developed the Transport Synopsis Tool, a free online platform that for the first time enables industry stakeholders, policy makers and the wider public to access a comparative analysis of a magnitude of almost 100 future studies concerning the European transport industry. Based on an extensive review of these studies, the RACE2050 project team evaluated the study’s assessments regarding their assumed relative importance of a range of 15 predefined competitiveness parameters. The review of such pertinent transport future studies and future industry scenarios comprised the investigation of seven primary and eight secondary parameters that could be evaluated on a scale from 1 (“Extremely relevant” issue for the industry and/or the market, positively or negatively”) to 4 (“Competitiveness factor was not mentioned at all”). These parameters are not chosen randomly, but are based on RACE2050’s enduring substruction of the most crucial competitiveness parameters out of dozens of future studies as well as on the World Economic Forum’s (WEF) global competitiveness reports. These assessments fed a database that finally formed the core of the Transport Synopsis Tool and enables serious, informative and playful interaction.
With the aid of clear visualizations and individual search options, dozens of otherwise isolated future studies and scenarios from 11 industry segments are integrated into a comparative tool, facilitating the identification of key success factors for a sustainable growth of the European transport industries, which can increase its strength in a long perspective up to 2050.

Visualizations of reviews are offered either in a “Radar” or a “Bar Chart” modus.


As this tool is not only intended to illustrate (contradictory) paths for future growth of the sector, the Transport Synopsis Tool is also developed to grow itself. Designed with the idea of an open network character, the tool strongly encourages the possibility to add new reviews of fresh future studies or scenarios to the platform in order to let it grow gradually.
The Transport Synopsis Tool aims at both informing the transport industry community by highlighting key factors for competitiveness as well as to facilitate the discussion among experts from transport industry, research, policy and foresight experts. In this vein, this tool, which was for the first time presented to the public at the InnoTrans trade fair Berlin in September 2014, will persist as a legacy well after the end of this project, and, beyond that, is developed to implement continuous extensions and amendments to let it become one of the leading European future platforms in the transport realm.
http://www.transport-synopsis.eu

List of Websites:
http://www.race2050.org/
http://www.transport-synopsis.eu/

Dr. Massimo Moraglio
Technische Universitaet Berlin
Work and Technology
Marchstraße 23, MAR 1-1
D-10587 Berlin

tel: [phone]
fax: [phone]
e-mail: [e-mail]
www.tu-berlin.de