6 months in – how many more to go?
written by Nicoletta Moss
COVID-19 has affected all of us: our society, businesses and on an individual level. No need to go into detail here. We all have experienced it first-hand. Even though one or the other might have come through this worldwide crisis pretty ok, there is still a certain nagging in the back of our mind: how much longer will the uncertainty last? How will the future look like? What will the economy do? And what impact will this have on me and my family?
Credit Victor He (@victorhwn725)
Countless taskforces around the globe are trying to answer exactly these questions and more. To be fair: nobody really knows. Divination is a very unprecise art – but we have half a year of data to work with and we are given different possible models by prominent consultancies such as McKinsey or BCG. Most of them talk about four different scenarios such as the following from Deloitte:
- Shakes society but, after a slow start, is met with an increasingly effective health system and political response.
- Coordinated measures by global players to spread awareness and share best practices.
- Competence renews trust in public institutions.
- Fiscal and monetary stimulus help but cannot reverse the losses that small businesses and individuals have experienced.
- Persists past initial projections, growing burden on governments.
- Public-private partnerships surge as companies step up to be part of a global solution.
- New “pop-up ecosystems” to respond to critical needs and drive much-needed innovation.
Sunrise in the east
- Pandemic is severe and unfolds inconsistently across the world.
- East Asian countries manage the disease more effectively.
- Western nations struggle with lasting impacts—human, social, economic—driven by slower and inconsistent responses.
- Global center of power shifts decisively east.
- Pandemic becomes a prolonged crisis as waves of disease rock the globe for longer than anyone was prepared for.
- Mounting deaths, social unrest, and economic free fall become prominent.
- Nations put strict controls on foreigners and force supply chains home in the name of local security.
- Government surveillance is commonplace, with tech monitors on people and their movements.
Now, let’s get the facts and figures right. Car sales in Europe went down by 25% but we also can see some improvements in the vehicle markets propped by a combination of pent-up demand and various government subsidy programmes encouraging drivers to trade in older cars for new ones, says a study performed by Counterpoint. Consumers are still worried about buying high-ticket items like cars, given the uncertainty over the economy and their job security.
In contrast the European Electric Vehicle car sales increased around 90% during January-April 2020 compared to last year. It is likely that the governments will respond to the pandemic by increasing subsidies and incentives for EVs to meet emission targets, boost economic growth and generate more jobs.
Other winners in the crisis are the two-wheelers. Classic usage of bikes, scooters and motorbikes are growing significantly. Micromobility globally has been initially severely impacted by COVID-19 with lockdowns resulting in reduced ridership. The road to recovery is a tough one, but Counterpoint believes micromobility will be the biggest beneficiary from COVID-19 among all forms of shared mobility. Citizens and governments in many cities are becoming increasingly aware of the benefits of micromobility, and companies should prepare for coming opportunities.
But what is most interesting is the development of ride sharing services such as car sharing or ride pooling. Post-COVID-19, the global ride sharing market size is projected to grow at a Y-O-Y growth of 55.6% from 2020 to 2021. The major drivers of this market include the growing need for personal mobility in the wake of rising urbanization and fall in car ownership. Also, growing internet and smartphone penetration and stringent CO2 reduction targets are leading to the high growth of the ride sharing market. In the past few years, car sharing has gained popularity due to several positive factors such as reduced travel costs, traffic congestion, and emissions. However, with the impact of COVID-19, the car sharing market is estimated to lose its share by 50–60% during 2020, says MarketsandMarkets™. Furthermore, by 2021, it will re-establish itself, gaining an increased share of 70–80% because of new strategies like providing partitions to keep the distance between driver and passenger, equipping the vehicle with sanitizers.
Already right at the start of the global crisis, our ride pooling service Cool has made its shared trips safer for its driver and passengers, with the installation of a Perspex screen between drivers and riders as well as a physical partition between seats. The company is also limiting the maximum number of riders per vehicle. With all the efforts put into place we are very happy to see that ridership is already up again to the levels we have seen in February, before the crisis started.
And the last note: Experiencing Malta with much less pollution of cars is a treat and a noticeable difference for everyone. Shared mobility contributes to a cleaner environment. This is our chance to change our habits and contribute to the largest ever global air pollution experiment. Data collected by Cool in its first year of operations shows that its high rate of sharing can reduce traffic in Malta by 15% to 30%. In its first year of service introduction, Cool has saved Malta’s infrastructure from over 450,000 vehicle kilometres that would have otherwise been travelled by single occupancy vehicles. This has resulted in a reduction of 100,000 kg of CO2 from being dispersed in the environment.
To sum it up: yes, some of the outlooks and scenarios are looking in general rather gloomy – but if we look closer at our industry it is most important to collaborate, be disciplined and seize the opportunity to use these challenging times as an opportunity to update old systems, replace processes which are no longer functioning and contribute actively to a sustainable future.