The future of mobility in smart cities

According to the UN, the world’s population will reach 9.8 billion by 2050, with the biggest impact in all likelihood primarily hitting urban areas. In fact, that the same year, an estimated 2.5 billion people will move from the countryside to the city.  

As a response to this phenomenon, the “smart city” concept was born, a new model that makes urban mobility more efficient and sustainable, with the aim of enhancing citizens’ quality of life.  The smart city is an opportunity for leading and emerging companies to rethink urban mobility and adapt their current business models to a radically changing market. 

Moving in this direction, the business monitor Mobility for smart cities: worldwide landscape and alliance network by MobiUS, together with the Smart and Sustainable Mobility Lab by SDA Bocconi are studying the mobility ecosystem in smart cities. Their aim is to investigate the following questions: 

• What are the main mobility applications in smart cities? What are their prospects for growth?  
• What makes a city smart? What are some examples of the world’s most virtuous smart cities?  
• What are the most common collaborative strategies in the context of smart city mobility? What are the most promising initiatives?  

The first part of our study offers an overview of the evolution of the smart city ecosystem at a global level, describing and providing estimates on major trends based on market reports and academic research, with an eye to mobility. In this first phase of our work, we evaluated the growth rate and the growth potential for key applications in the context of mobility for smart cities. From this initial analysis, electric cars emerge as the most advanced application in terms of technologies and investments, despite the many barriers to adoption that consumers face. Applications such as autonomous driving or urban air mobility are still less common, and many doubts remain as far as regulating and rolling out these technologies.  

Next, we investigated these applications in relation to a framework we developed (Figure 1) based on technological innovation and use innovation (referring to the possibility for individual or shared use in terms of mobility as a service). 

Figure 1 - Categorization framework of mobility applications in smart cities

The second part of our study focused on the key performance indicators that measure a city’s “smartness.” These indicators are affordability, urban planning, sustainability, international scope, connectivity, mobility and transportation.  Based on these categories, we identified the top 25 cities in terms of general mobility, which we deemed “mobility champions,” and the top 25 mobility innovators or “small mobility champions” representing smaller cities (with populations from 50,000 to 600,000).  

A virtuous example among big cities is Berlin. Thanks to numerous investments (in bike paths, zero-emissions zones, infrastructure and incentives to accelerate electrification, for example), car use has drastically dropped in this city. Continuing with the approach we adopted, we can compare smart cities in the same area which face similar challenges and opportunities. (US cities are extremely car-dependent, for example.) We were also able to pinpoint recurring regulations and solutions (again referring to the US, demand-based tolls, or infrastructure or incentives to promote electrification). 

Figures 2 and 3 offer a summary of our analyses, listing the main strengths for each smart city. From this we can discern two different strategies in developing sustainable solutions for urban mobility. On one hand, bigger cities take a top-down approach, with investment decisions made by leaders in the public administration. The aim is to shore up existing infrastructure, and invest in multiple mobility applications to consolidate the city’s positioning at a global level.  

Figure 2 - Categorization framework of mobility applications in smart cities

In contrast, smaller cities seem to deploy a bottom-up approach, implementing initiatives promoted by associations or by citizens themselves, with greater focus on problem solving impacting the local community (for instance, traffic congestion, high CO2 levels, or inadequate inter-city connections). 

Figure 3 - strengths of smart cities «small mobility champions»

Finally, the last part of our study draws a map of the set of companies that are working to come up with mobility solutions in smart cities, exploring the collaborative strategies developed from 2017 to 2021 (contract agreements, strategic partnerships, joint ventures). We started by extracting pertinent partnerships, and utilized social network analysis to examine the ecosystem of several alliances in the context of smart city mobility. From our data analysis, we note that agreements are often based on complementarity and the participation of companies from a range of different industries. What’s more, the fact that these collaborations are more widespread in Asia and North America seems to suggest that some industrial systems are more actively engaged in collaborative efforts than others, such as in the EU. 

We chose twelve companies by determining the centrality in the network, and scrutinized them as case studies. Among these firms there were traditional manufacturers such as Daimler (now Mercedes-Benz) on one hand, investing in smart infrastructure and technologies for several mobility applications. On the other, there were startups and service providers who focus on one or two specific applications, such as Blade Urban Air Mobility, specializing in the electrification of urban aircraft in the US. There are also firms that offer innovative solutions for solving critical problems such as battery life and a lack of charging stations. An example here is Sun Mobility Solutions, which market battery swapping technologies for two- and three-wheel vehicles.  

Emerging from our study are diverse development models for smart cities around the world. On one hand we have thriving cities that tap their own resources to become gold standards in smart mobility; on the other, there are smaller cities that take a participative approach, actively engaging their citizens and pursuing innovative strategies to improve mobility in their communities. In the future, it will be vitally important to carefully monitor outcomes in terms of quality of life and efficiency of transportation with both models.  

The mobility ecosystem in smart cities is populated by a vast range of companies, linked by strategic connections based on various kinds of collaboration. These include state-owned enterprises committed to providing citizens with the best infrastructure, as well as traditional car manufacturers that work together to win (or avoid losing) their place in the arena of future mobility. And last there are startups that create connections to access critical components and resources at a technological level, and to overcome commercial barriers. The evolution of these dynamics will drive the transition toward smarter, more livable cities in the coming years.