This month on the ‘Women In Shared Mobility’ series, our CEO Sandra Phillips interviewed Katharina Wagner, Co-Founder and CEO of Oply.
Katharina Wagner is a passionate mobility expert with seven plus years’ experience in the sharing economy. Katharina is the co-founded and built the innovative zone-based car sharing concept Oply which launched in three cities within one year. Before Oply, Katharina held the position of Head of Business Development Europe for car2go, Daimlers car sharing daughter, and helped set up most of the European car2go locations. Katharina holds an MBA from the WHU – Otto Beisheim School of Management and a Diploma in International Business. Before her life in mobility, Katharina worked across industries in Media, Loyalty, Automotive and online retail.
Women in Shared Mobility: THE FUTURE OF CARSHARING SYSTEMS AND MOBILITY-AS-A-SERVICE IN OUR CITIES
Katharina Wagner, Co-Founder and CEO of Oply.
Sandra Phillips, chief executive officer, movmi
Before we begin, why don’t you tell us a little bit about yourself?
Sure, thanks for having me Sandra. Mobility has been with me for quite a long time and I mean even as a student I used car sharing, so I was really happy that I could join car2go back in 2013. With car2go I had the possibility to build all locations in Europe as head of business development for Europe – that meant scouting new locations, negotiating parking agreements, launching them as well. It was a lot of fun and I learned a ton obviously about new mobility in that area being also the pioneer of free floating and car2go back then. After car2go I joined a start-up and co-founded a carsharing company which focused on a more niche market, round trips and station based carsharing. The company’s name is Oply, we’ve been operating for two years in Hamburg, Munich and Berlin but we’re actually shutting down right now because of funding issues, due to the current challenges in mobility.
1. DO YOU THINK CARSHARING IS PAST ITS PEAK INVESTMENT?
If we take the current special situation out of the equation – which obviously is not a totally fair, but nobody can predict what happens with that at the moment, but just looking at the development in shared mobility. If everything were to continue as it was, I would say that what you’ve seen is a bit of a shift of focus, in terms of mobility modes in which investors chose to invest. Carsharing is kind of, already, the grandparents of mobility, it’s been around for a long time for the station based and around 12 years for free floating. They have been struggling to prove that this business model can be highly profitable at all.
That obviously has led investors to become more cautious on going into modes like car sharing, but where we have seen really high investment rounds are in younger generations of mobility like E- Scooters but also models like Cluno and Finn.auto – short term leasing companies here in Germany and in Europe in general. I have seen a few developments in that and they have raised quite a big ticket. So no, I don’t think it’ going down, I think it’s shifting from more traditional ways to new mobility options, because the profitability outlook wasn’t too good for classical carsharing and free floating carsharing.
2. do you think BEHAVIOUR IS shifting BECAUSE THEY ARE CHASING THE ‘SHINY NEW THING’?
I think there are probably different reasons, so one is that there are actually not many investment possibilities into classical car sharing anymore because within the last year there has been a big consolidation going on in their markets, so a lot of companies have been bought already, so there is nothing to invest into. They’re really not even a handful of companies left in Europe, who are independent from either venture capitalists or big OEMs or something similar. This is probably one of the reasons, so it would be really founding and controlling a new company and this is nothing which venture capitalist will do obviously. Yes, looking into it new mobility options where you can scale much faster with lower investments than classical carsharing and promises higher returns, I do think they’re chasing something new and of the more profitable models, however it is like a curve right we have seen that curve and car-sharing of this curve will come in these markets as well, so there will be a consolidation going on.
There was already one big acquisition where a German provider supply for bird and actually it was a share only deal, so there was really no money going back and forth, so it’s not a successful exhibit you could consider. You see consolidation is already starting because these companies are struggling to keep up with the high costs which they’re having and obviously crazy competition out there. Having six to ten different scooter providers is just not sustainable for a market. Yes they’re changing but at the same time when the curve will go down consolidation will happen also in this market.
3. WHAT ARE THE LESSONS LEARNED FROM THESE CRAZY CURVES THAT SEEM TO MOVE IN A FASTER AND FASTER ITERATION?
My biggest learnings with Oply – and I think it does apply to models like ShareNow – you have to choose the right partners and the partners with the right purpose. What we’ve seen is that companies whose main purpose is not mobility or not providing mobility as a service, they are shifting away from these modes of mobility as soon as cost pressure gets too high or they realize that the profits are not what they expected or the growth is slower and more complex than they expected, or economic slowdown just forces them to focus more on the business.
I think we have seen, since the change of management in both Mercedes and BMW, both new CEOs announced, ‘we’re not a mobility provider we are a car manufacturer’ and this is the statement for them and they’ve put investment for 12 years into carsharing and not just carsharing, but also other services around it with ParkNow, ChargeNow, My Taxi – you name it and now they’re kind of turning away from it and actually looking for external investors to help them support their high financial burden which they have because they want to focus on their core business. Since their purpose has not been providing mobility services, they’re now just going back to their purpose which is building cars.
On the other hand companies whose purpose it was to provide mobility, like Zipcar who has been in the business forever, for a pretty long time – and I think Sixt is one of the players where we can look at who has made high investment into a car sharing. It was created as a completely new, fully integrated, car sharing and car rental service and they’re doing this because their purpose is Mobility-as-a-Service. These are probably the biggest lessons to look at why companies do this.
4. HAVE PUBLIC TRANSIT AGENCIES IN EUROPE BECOME MUCH MORE INTERESTED MOBILITY-AS-A-SERVICE SYSTEMS?
Absolutely, I mean, not just public transit. Let me start with Deutsche Bahn, which is also kind of publicly owned train provider. Their purpose is definitely to provide mobility for the population, since they’re also tax funded. They for example, have provided Flixter and a platform for other car sharers for many years, although they’re also struggling for profitability, but they’ve always tried to keep it up because it’s part of their 360 mobility options for the customers. What we have also observed here in Europe the gas company Ferrovial in Spain which is also a train company, was offering the city carsharing, and is now just an extension of their offer to the clients. Here in Berlin and the BVG which is the local transportation provider, they have experimented and teamed up with ViaVan and experimented with shared mobility. I think they are also available in the US right in Canada, so it’s a very similar concept but it was a different brand which is a local brand Berlkönig and it is run successfully from the BVG point of view, but actually it is right now on the verge of being killed as well because the city of Berlin might not want to invest more to support the service. The fit with the public transportation company definitely makes a lot of sense.
5. WHAT DO CARSHARING SYSTEMS NEED FROM A CITY PERSPECTIVE TO MAKE THEM MORE PROFITABLE OR AT LEAST FINANCIALLY SUSTAINABLE?
Berlin is a very special case here because they allowed a pilot with Clever Shuttle and later with their own Berlkönig and at the same time they didn’t provide licenses to Moya who wanted to come to Berlin because they were protecting the existing models right and now they’re planning to shut it down or most probably they’ll shut down because they won’t to fund it and I hope they’ll realize that partnerships are probably the way to go. It’s not that you have to do everything yourself but you have to create legislations that provide you with a planning horizon. In mobility, since it’s an asset heavy business and you have either the cars or the drivers or a lot of other restrictions, you need quite some time to start making profit. You need a planning horizon which is far ahead in the future and if you just get a license for one year this might not be enough to run your business and also Clever Shuttle might not be extended and in Summer.
They also might face the same issue like Berlkönig. On the other hand there are cities like Hamburg, who, for themselves, created the target to become a smart city, a digital city, a city which provides mobility for their citizens and they provided more than 1,000 licenses and apparently it’s been used very well by the public. What it needs I think, is an open mindedness from the cities to create and provide regulations which those companies need to be able to plan ahead but also to run their businesses profitable, but also an open-mindedness and a willingness to create public/private partnerships where operators provide service and the cities might provide access to whatever they need, be it integration of public transportation, incentives for the citizens, incentives for the companies to switch their population from using cars towards other mobility options. Therefore creating more demand for those services and helping them to become a sustainable service in the city.
6. Do you have any ideas on something that a city should LOOK AT, apart from just financial sustainability, THAT WOULD SHOW SUCCESS?
Sure, another example from Germany is Munich. Already pretty early after the introduction of free-floating, Munich has been open to all different kinds of mobility. What they created is a pilot project. For three years, it’s important that it’s not just one year because we’re trying to change behavior of people and it doesn’t happen overnight, so you need a reasonable time horizon to be able to measure the impact. During that time all mobility options participated in this survey. Munich created a regulation for car sharing which is unique in Germany, which just very clearly defines; what does free floating mean? What’s the highest license to apply for? What do you have to pay for it? What are your rights? They have created the same for stationary based car sharing, they have bi-sharing system which they supported under transportation and a few other options. All of these mobility options participated with their customers within the survey.
They certainly looked at car ownership but also car usage, potential place reduction in terms of parking price. They looked at cannibalization effects for public transportation through the new mobility options and cross usage. After this time the results were evaluated together and it was so positive that they extended the pilot and even reduced the cost for carsharing because they saw the positive for that. The metrics should be not just reducing car ownership because also here it’s a change of behavior and public people start changing their way of moving around the city, but they still keep the car because they like having this ‘peace of mind’ to have their car available. They might be able to sell it or be willing to sell it in three or five years or so. They should also look at, ‘how long your private car is not being used for’ because this is obviously a big indicator because there are other options of mobility.
Some other measures Munich were looking at were ‘the limitation of the transportation’ or ‘how do other mobility modes increase, walking, riding a bike and using shared cars?’ Not just shared cars, because there is probably more than one person driving that car. These would all help as a set of measures to evaluate whether it was successful or not. You can’t always look at one mode individually, you really have to integrate the evaluation.
7. IS THERE ANYTHING ELSE YOU WOULD LIKE TO SAY TO OUR LISTENERS AND VIEWERS?
Yes, because of all the divestments I’ve seen over the last six months or so on car sharing, there have been a lot of discussions that carsharing is dead. I don’t think it’s dead, I think it’s having a hard time, obviously and it will be even harder this year because of Covid-19, but what we have seen at Oply is that there’s a huge demand for an alternative to your private car. This demand will grow because of more inhabitants in the cities, because of more regulations which the cities will enforce, because of more environmental restrictions which we’ll see around thE world and because of lack of alternatives – real alternatives for that. I think there will be a revival of carsharing within a few years, when new options or existing options will expand their offerings to more private cars similar in use cases. Not just in a city but really using the car for round trips, bringing your kids to sport events, coming back from going on holidays and things like that. I think carsharing is not dead. It’s still existing, still being used and I think it will grow in the future, more than we can imagine right now.
What are your thoughts on the future of shared mobility and what developments are to be expected in 2020? If you would like to be interviewed or to nominate a woman working in Shared Mobility for our next series, get in touch with us here.