Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Focusing on Asian logistics, transportation, and travel companies

Asian Equities Analyst, Logistics & Transport

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Thematic (Sector/Industry)

United states Industrials / Thematic (Sector/Industry)

Rising urbanization and the broad adoption of mobile internet are encouraging dramatic changes in the way Americans use personal automobiles (including taxicabs and privately owned vehicles). Parking, insuring, and maintaining a car in some US cities has become prohibitively expensive, and for many younger Americans, in particular, the costs and hassles of ownership make it an increasingly unattractive option.Meanwhile, the ubiquity of mobile internet has made possible new ride-hailing and car-sharing business models that help to address mismatches between short-term vehicle supply and demand, theoretically making traditional taxi use and car ownership superfluous (in large cities, at least). Although these models have not yet been perfected, they aim to replicate and eventually replace conventional forms of personal mobility (taxi cabs, personal vehicles) with substitutes that are more convenient but cost-competitive and (ideally) hassle-free. In this note we look at some of these new business models and the leading US-based companies that are promoting them as alternatives to traditional forms of personal mobility. We also analyze the current and future drivers of growth in these new segments and what the challenges are to achieving expected growth (and profitability, eventually). Finally, we attempt to select which models have the greatest chance to succeed here in the US, and which ones appear to face the greatest challenges. This note is part one of a two part series and deals mainly with US-based companies. In part two of this series, <a href="https://www.smartkarma.com/profiles/803" target="_blank" data-smartkarma-citation="accounts:803">Valerie Law, CFA</a> will write about the rapidly developing ride hailing and car-sharing segments in China.

Rising urbanization and the broad adoption of mobile internet are encouraging dramatic changes in the way Americans use personal automobiles (including taxicabs and privately owned vehicles). Parking, insuring, and maintaining a car in some US cities has become prohibitively expensive, and for many younger Americans, in particular, the costs and hassles of ownership make it an increasingly unattractive option.Meanwhile, the ubiquity of mobile internet has made possible new ride-hailing and car-sharing business models that help to address mismatches between short-term vehicle supply and demand, theoretically making traditional taxi use and car ownership superfluous (in large cities, at least). Although these models have not yet been perfected, they aim to replicate and eventually replace conventional forms of personal mobility (taxi cabs, personal vehicles) with substitutes that are more convenient but cost-competitive and (ideally) hassle-free. In this note we look at some of these new business models and the leading US-based companies that are promoting them as alternatives to traditional forms of personal mobility. We also analyze the current and future drivers of growth in these new segments and what the challenges are to achieving expected growth (and profitability, eventually). Finally, we attempt to select which models have the greatest chance to succeed here in the US, and which ones appear to face the greatest challenges. This note is part one of a two part series and deals mainly with US-based companies. In part two of this series, Valerie Law, CFA will write about the rapidly developing ride hailing and car-sharing segments in China.

A Map for the Future of Personal Mobility, Part 1 of 2: United States