The Mobility Allowance – Making Multi-Modal Transport a Reality – Part 1

More and more travelers and commuters want to go multi-modal – using different modes of transportation on an as-needed basis. However, booking and paying for each mode of transport separately makes it demanding to connect them. Having an application such as a “mobility allowance” or “mobility budget” with which you can use – and pay for – several modes of transportation is not only interesting for private travelers but also for corporate use. Thomas Hengstermann, Head of Sales & Service, talks about the use cases for companies and what a mobility budget could look like in the future.

Why do we need – or people today want – a service such as the mobility allowance?

The mobility allowance is so very interesting because the whole transportation environment is changing right now. Owning a vehicle is not the ultimate thing anymore. And not only private travelers see that change.

A lot of companies see a decrease in the want for company cars and increase in young people saying “I don’t want a fancy car; I want a fancy smartphone, a fancy laptop or give me a budget for transportation and mobility that lets me choose how to get from A to B.”

So, this will not only be a trend for private transportation, but also an opportunity for companies to expand the mobility options and provide more flexibility for their employees.

What could a mobility allowance in the future look like?

Today, there are already applications that can manage several mobility service providers – such as car sharing, car rental and taxi for example – in one service, reserved and paid for with the mobility budget. Our vision is to integrate all known mobility service provider in one app – to be managed via the allowance.

That includes car sharing, car rental and taxi services, just the same as bike sharing, chauffeur services, trains, long distance busses, and of course local public transport such as the city railway and busses. There will be no limitation for the traveling person; the user will be able to choose whatever mode of transportation is the best in his specific case.

When we talk about the process of the transaction and the handling of the app, it is mandatory that using the mobility allowance should be as easy as possible, self-explanatory even. Prior to the reservation and booking, the only specification the user has to make is: Do I want to travel with my private budget or my business allowance? So it is only one click before the user can book and drive his chosen mode of transportation.

How would people use the mobility allowance?

The mobility allowance will be managed and used via the smartphone. It is linked to our route planning app – that means, as soon as you have downloaded the app you are able to plan, book, use and pay for your trip via this one application. If a company decides to link an allowance with the app, you can pay for business trips or your day to day commute with that personal budget.

And ideally the traveling person will use the mobility allowance on a daily basis – regardless of whether he travels privately or on a business trip. It will be the same app he is using, the only difference is the account. So there will be no disruption: one app, one system, no need for totally different transportation frameworks.

What are the advantages of a mobility allowance?

We have to consider two perspectives to this question: From the company’s point of view a mobility allowance for its employees stands to reason because it facilitates a great deal of flexibility. In addition to that, a mobility budget is a good chance to reduce costs because mobility service providers such as car sharing, bike sharing and the local public transport are included as more-cost effective alternatives. So, in the future the most convenient mode of transportation does not necessarily have to be the most expensive.

And in the end, there is a third advantage for companies in introducing a mobility allowance for their employees: In terms of employer branding the mobility allowance increases the appeal of the company as an employer, saying: “We have a new, innovative mobility solution for you. You can decide whether you want a company car or a mobility budget with several modes of transportation to choose from.”

For the employee of course, the most important advantage is the freedom to choose whichever mode of transportation is convenient for him at the moment and paying for it without disruption. It is transparent in the use, a simple way of accounting and it is just one app that you can use privately and for business use. You do not have to handle different systems for different use cases.

Tell us in the comments: Would you prefer a mobility allowance over a company car? Why (not)?

Please note that this article expresses the opinions of the author and does not reflect the views of Move Forward.

The Mobility Allowance – Making Multi-Modal Transport a Reality – Part 2

Most commuters today dream of a seamless travel experience – using different modes of transport on an as-needed basis without disruption (e.g. in payment) or varying complex booking systems. An application such as a “mobility allowance” with which you can use – and pay for – several modes of transportation is therefore tempting for private travelers as well as corporations – providing their employees with an alternative to the company car. Thomas Hengstermann, Head of Sales & Service, talks about what impact this has for mobility providers and how likely this scenario is for the next ten years.

What would a mobility allowance mean for the providers of mobility – public means of transport as well as private means of transport?

The more mobility service providers are integrated in the application, the more possibilities there are within the mobility allowance, and the more users there will be. The requirement being of course that the provider is willing to affiliate with the allowance application.

So, this service is not only allocating new modes of transportation to private travelers, but also brings together business travelers with mobility services that this target group did not use – or does not use – on a regular basis yet. For example: Public local transport is not a classic mode of transportation for a business trip. By making it bookable and payable via a tool such as the allowance, we open up those modes of transportation for customers that did not use them before.

How possible is that scenario for the next ten years? What would it need to make a mobility allowance come true?

The first step is already taken. The product “mobility allowance” is already available. What is missing for the second step – a wide, colorful bouquet of mobility service providers – is the number of partners affiliated with the allowance. So the big difference in the future will be that more and more modes of transportations will be available with the allowance giving the traveling person a whole lot more options. This might be possible within the next two years.

Looking at the next ten years, the mobility allowance will also be available more extensively and across a wider area. Today the focus is on big cities and the users are first movers, seeing the trend. Distinctly more companies will likely be offering the mobility allowance in the near future – which means more people using it as well.

And of course the process of using the mobility allowance will be optimized constantly, always striving for the most convenient and straightforward approach.

What kind of packages can be put together?

Today we already have a gradation in terms of the provided budget. So the company has the flexibility to decide on the amount of money that is available for the employee based on pay grade, position, company car or not, permanent employee or temporary assistant. These nuances and the amounts of the budget will be different in every company.

Packages regarding the services – e.g. with a selection of three out of six mobility service providers – are not in the works right now for the simple reason that the restriction is unwelcome. Imagine an employee says he always uses car sharing, never a taxi. Now he is stranded at the airport late one evening and there is no available shared car. He will be happy he has the other options.

Everybody should have the possibilities to use all the mobility service providers that are bookable with the application. If someone decides not to use one of them, he simply has more of the budget for the other modes of transportation.

Which modes of transportation would you like to include in the allowance for your commute or day-to-day use? Leave a comment.

Please note that this article expresses the opinions of the author and does not reflect the views of Move Forward.