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A shared mobility On-Demand Service

Periodic Reporting for period 1 - SHOTL (A shared mobility On-Demand Service)

Reporting period: 2016-12-01 to 2017-05-31

In Europe, road congestion is responsible for economic losses of 1% of GDP due to lost time, wasted fuel, air pollution and increased cost of doing business. Just in terms of lost productive time, commuters in Barcelona spend roughly 28 hours in traffic jams every year, while in London commuters waste a staggering 101 hours sat in traffic. On the existing trajectory, overall congestion costs will increase by 50% – or nearly 200B € annually – by 2050. Indeed, countering these trends is vital to improving quality of life for local residents and meeting air quality and Greenhouse Gas (GHG) reduction goals.

Apart from classic public transit and other mobility initiatives (bikesharing, carsharing, carpooling, etc.) number of collective ‘ride-sharing’ solutions have been piloted in European cities but have failed to reach scale because they do not sufficiently meet the needs of users and public transit agencies. This is due to a number of shortcomings:
- Private cars that only carry 1-2 people per trip
- Concerns about private data security and safety
- ‘Surge pricing’ during peak demand times
- High cost structures that require public subsidies
- Long wait times
- Non-professional chauffeurs

As it turns out, car drivers often times travel to work or school in parallel with neighbours who are driving to nearby locations. Young professionals, especially Millennials, are turning to new collective mobility services that are cheaper and more flexible than using a private car. At the same time, city transit authorities and auto clubs are actively seeking “Mobility-as-a-Service” solutions that offer suitable alternatives for citizens whilst reducing road congestion. At SHOTL, we propose an on-demand transportation service that matches multiple passengers headed in the same direction with an available shared vehicle and professional driver, to complement .

Objectives of the SHOTL project
Deliver a Smart Mobility solution for daily commuting that eliminates dependence on private cars, increases use of public transport and reduces congestion, air pollution and GHG emissions in urban areas. The SHOTL project aims to generate positive impacts across Europe by eliminating 165K cars from urban roads, saving 300K hours of productive time and avoiding nearly 40K tonnes of CO2 emissions annually by 2022.

Specifically, the objectives of this SME-Inst Feasibility study are:
- Present an Alpha version to stakeholders & gather direct feedback
- Protect technology and commercial interests
- Perform a comprehensive Freedom to Operate analysis, assess national/EU regulatory frameworks, register software interfaces as Industrial Property and register additional product Trademarks.
- Create a go-to-market business plan focussed on key European markets
Working closely with exisiting and newly identified stakeholder parters during the past six months, we have thoroughly investigated our primary target markets in Europe and investigated wider global markets, validated the technological feasibility and economic viability of our technology, and carried out a freedom to operate analysis to ensure a sustainable competitive advantage. Specifically, we have:
- Validated a proof-of-concept of product performance in situ with mini pilots and workshops (practical and technological feasibility)
- Identified 3 ‘lighthouse’ Cities for signing Memorandums of Understanding highlighting key stakeholder intention to carry out large-scale pilots with our solution (practicability and scalability)
- Implemented a plan to protect technology and commercial interests (economic viability)
- Prepared a business plan to execute the opportunity that we have proven (practical and economic viability)

During six months that primarily consisted of direct market investigation, we investigated three key potential use cases for our product:
(1) Shotl Transport “In-city”
(2) Shotl Transport “Urban areas, not well served by Public Transport”
(3) Shotl Transport “Companies out of the city”

Competitor analysis and stakeholder-purchaser feedback confirms that our new technological development (alpha release) is currently leading a new sector of the incoming mobility products market and has great potential to fully answer the real need. Through direct interaction with cities and all the stakeholders in our value chain, focused workshops in different Countries, as well as attendance at European mobility events such as the CIVITAS Sustainable Urban Mobility Plans conference 2017, we now have a much more detailed insight into which city segment to target, the needs and how to access those cities. Our target will be “Urban areas, not well served by Public Transport”, these areas are present in the smaller cities and so we have identified these with our market investigations.

We have also updated our knowledge of market barriers. One of these are local regulations that can sometimes define the possibility that only a limited set of companies may operate shared transport systems within their city. As a result, we have defined a strategy to enter into partnership with local bus companies, offering them a share in the revenues generated and an overal improvement to the efficiency, size of area and number passangers that they can service. An example of this has occurred with is signing and operating our first pre-commercial service: SEAT and the bus company MOVENTIA within the City of Sant Cugat in Spain.
European markets we are fully convinced that we can meet this opportunity and become a leader of this market. Mobility is a topic which has a significant interest in Europe due to the continuous increase of CO2 emissions, number of registered cars and parking places. On a global scale, the Total Available Market for mobility is a massive $10Tr. Within this our market potential is defined by the number of cities that could implement the Shotl technology in their urban bus network. Then currently exists 8,861 Cities Globally with more than 50,000 inhabitants that could be considered as our Total Adressable Market.

In large urban areas, most of the journeys from the metropolitan area to the city are made with private cars, because of the limited availability and quality of the public transport in the outer metropolitan area. Most of the European cities have a significant functional area which represents most of the commute to the city. In this option, there is an opportunity for Shotl to replace those private vehicles. This is detailed in ‘People Near Transit’ reports such as the following: where this a very strong drop in the amount of people who are close to public transport outside of city areas. Within this category there is also a class of medium to small cities where even inside of the city area there are areas, corridors or time periods (i.e. at night or on weekends) that lack public transport.

As Shotl, guarantees an average of 7-8 passengers per vehicle per hour, which is much more efficient than leading alternatives. Shotl, in partnership with local public transport authorities, helps reducing the total cost of operating public transport services while offering a more attractive solution for users. A more attractive transit service will permit increasing the demand for transit and shared modes, facilitating a virtuous cycle that permit reducing congestion, air pollution and GHG emissions and improve accessibility. The societal benefits of such a system have been studied by the OECD International Transport Forum reports, such as estimating that a full deployment of a system like Shotl in a city would reduce the need for parking a 95% and the CO2 emissions a 34%, providing also an huge improvement in equitable access to jobs, health and education facilities (P90/P10 indices being reduced from 20-40 to 2-3). Moreover, prices for journeys in the city could be 50% or less of today even without subsidy thanks to the highly efficient use of capacity.
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