By Jana Bartels, General Manager of Hardware and Vehicles at Wunder Mobility
No matter where you’re operating, shared mobility providers face the same major challenge. Which vehicle or vehicles are the right strategic choice? It’s an investment that will influence the success of the entire business.
With the array of light electric vehicles (LEVs) now available to both new and scaling fleets, here is a set of guidance to help you identify the right type of vehicle from the right manufacturer.
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- Your vehicle must be reliable, connected and fit your user’s needs
The first consideration is fundamental: reliability. The demands of the sharing market warrant a bullet-proof design, solid spare parts, and strong resistance to vandalism and misuse. Parts should last in the event of a light accident without cracking or functional damage.
Connectivity is closely linked to physical performance – interrogate how stable your vehicle’s IoT device is. These devices are the heartbeat of a smart sharing fleet that works seamlessly with its operating system. Make sure the vehicle and software offers multi-sim card capability. With a single sim you are dependent on a single internet provider, which means if there are network interruptions or their service stops, so does yours.
The size and weight of your target user should also be considered – which can vary across global markets. Suitability goes beyond user ergonomics – what are the design and convenience preferences in your cities? The look and experience associated with riding can be subtly different across markets.
I recommend purchasing your sharing vehicle from a manufacturer who offers a B2C vehicle that they have adapted for the demands of the sharing market. The B2C market is more mature than the sharing market and so you can benefit from the long-term experience, stable supply chain and the maturity and scalability of their production processes.
Take the example of an e-moped. The purchase price is only around a third of its total cost of ownership – the remainder will be spent on maintenance and operation. When the team here at Wunder Mobility developed the sharing-ready G5L e-moped in partnership with Yadea, we followed the above principles. We took into consideration several market insights from the sharing industry as well as the depth of experience from Yadea’s B2C e-moped business. Brands like Emmy who have invested in these mopeds have seen improved operational costs since they hit the road.
- Prioritise powerful batteries
A high range and a fast charging time bring serious operational gains. Reduced frequency of charging is an obvious advantage. A faster battery charging time has a dual benefit – it decreases your spare part costs as you will need fewer spare batteries for a smooth operation, and it increases availability for customers. Utilisation is the main KPI for any sharing business.
It’s also important to give careful thought to your charging infrastructure. How much battery storage space do you want on your charging points? How much power does each charger consume and what does that look like across all chargers together? Remember too, insurance costs are higher the more batteries there are in your warehouse and at charging points.
If you have a higher range and lower charging time you won’t need lots of buffer batteries. You’ll save storage space, turning out to be even more cost-efficient overall.
- Maintain and repair, fast!
Shared scheme operators should be able to repair and maintain vehicles 24 hours a day. When choosing your vehicle, ensure you can achieve a fast repair time. This can save plenty of costs and keep availability high and thus the prospect of greater utilisation.
For this to work, you need excellent availability of spare parts. Keeping a high stock of parts means high investment and working capital which isn’t feasible for many. So consider which partners you will work with to ensure access to spare parts with same-day delivery. If your vehicle looks great but isn’t back on the road fast, it will harm your bottom line. Be aware of any part delivery limitations and plan your scaling with the parts supply chain of the vehicle manufacturer in mind.
- Plan for supply challenges and have a dual sourcing strategy
For some time now, global supply chains and logistics have been under pressure. Container space is short, prices can be extremely high, and hold-ups are common. It’s even harder to arrange shipping for goods classed as dangerous, like LEVs.
Therefore, consider the location of your vehicle manufacturer. If they’re not local, prepare well with plenty of order lead time. I recommend preparing a forecast to share with your chosen manufacturer. Giving them visibility of your scaling plans means they can prepare everything in advance and help to foresee challenges too.
The semiconductor crisis has also had a massive impact on LEV manufacturers. It’s an example of why a single sourcing strategy is risky if you have bigger fleets. Based on Wunder Mobility’s work with shared mobility scheme operators in over 900 cities globally, I recommend a dual sourcing strategy when scaling to more than 3,000 vehicles and launching in multiple cities. This means having two or more different vehicle brands in your fleet. Doing so reduces risk and gives you a better negotiating position.
With only one supplier for your vehicles, you risk the event of a supply bottleneck or supply disruption without the possibility of obtaining further vehicles, thus jeopardising your operations.
Furthermore, with a single source you run the risk of being dependent on the manufacturer to find a quick and sustainable solution in the event of a quality problem – which the manufacturer of course also knows and will play to accordingly.
Last but not least, with such a large fleet size you even run the risk of blackmail as your supplier will know very well that they are your only source. In the case of material and parts price increases as well as supply shortages, they may increase pricing without any fear of consequences. With a dual sourcing strategy, you have the chance to switch to the second supplier and drastically minimise your dependency.
Vehicle supply delays when launching or expanding in a city will affect your revenue and reputation – and at a time when more and more consumers are adopting shared mobility services, nobody wants that.