Mr. Alok Jain is the Managing Director of Trans-consult Asia, specializing in Traffic and Transport advisory services. He has worked in The Kowloon Motor Bus Co. (1933) Ltd. (KMB), Trans-consult Asia Ltd., Hong Kong, and MVA Asia Ltd., Hong Kong, and MTR Corporation / KCR Corporation, Hong Kong. He delivered keynote speech at UITP-BusWorld International Bus Conference in Kortrijk, Belgium on 23rd of October 2017. He shared with the audience about his vision about emerging mobility.
Some of the key highlights of the speech are:
1. Technological development in and outside the industry will force us to change our work patterns, workforce participation, laws and regulations and much more, something which we cannot even fathom at this point.
2. Cars can not replace Public Transport. It is mathematically and physically impossible to accommodate the footprint of humanity on cars which even though takes one-third of the physical space of a bus, carries 50 to 100 times less passengers.
3. In most cities, millions of customers spend on an average over 30 minutes sitting in the bus every day. This can be great opportunity for the public transport operators to create additional revenue sources.
4. Advancements in computing technology today also allow us to address many of the pain points which has led to current state of public transport. Sensors and data analytics can really transform our business in three key areas. Customer experience, operational execution and maintenance regime.
5. The future is electric for intra-urban travel. China has shown the leadership by widescale adoption of the technology. Today China operates 98% of the world fleet of electric buses. Whereas, Europe has taken an ideological lead by putting laws, policies, and funding mechanisms to support low-emission and electric buses.
Origional Speech delivered by Mr. Alok Jain
Mr. Bellot, Minister of transport, Belgium
Mr. Von Peter from European Commission
Mr. Van Quickborne from City of Kortrijk
Mr. Calvet Tordera, Mr. Deschacht,
Friends and colleagues from the bus industry,
Distinguished guests, ladies and gentleman.
A very good morning to you all.
As we gather here today to share ideas, exchange information and learn from each other, probably we all recognise the fact we are at the cusp of major transformation of our industry. Our minds may be full of questions or doubts but one certainty that we all are aware of is that tomorrow’s world is going to be completely different from today. Technological development in and outside the industry will force us to change our work patterns, workforce participation, laws and regulations and much more, something which we cannot even fathom at this point.
When I was a child, I was quite fascinated by the world of buses and trains. Until later into my adulthood and even now, I collect models of trains and buses. That is the only collection I possess. During my childhood, a bus driver was well respected member of the society. Trusted and knowledgeable. And then the glamourous world of media told us that if you are fashionable, rich or want to be counted, you must ditch that bus or train, and move on to buy your own car. Cities went on infrastructure building spree to accommodate these cars only to realise that they can’t build themselves out of this problem. We ended up making a mess of urban environments. Today, we realise the mistake and most urban cities want to restrict private cars in one form or the other. The world of public transport keeps changing constantly.
One fundamental question however remains. Does public transport have a future? We all hear how autonomous and shared cars will redefine the transport system of the future much to the detriment of public transport, which by the way was the “original” form of shared mobility. Will public transport as we know today be pushed into oblivion?
My assertion is that is not going to happen. As long as there is finite space in our urban areas, it is mathematically and physically impossible to accommodate the footprint of humanity on cars which even though takes one-third of the physical space of a bus, carries 50 to 100 times less passengers. Can you imagine achieving a capacity of 30,000 to 50,000 passengers per hour on any of your urban corridors with only private cars? If we look back into the history, the advent of cars 200 years ago was welcomed with the same gusto. It was supposed to give a new meaning to the human mobility as it was known then. And look where we stand today – bumper-to-bumper in traffic congestion!! In most of the cities, where private cars have dominance, often almost 80% of the vehicles are trying to move just about 20% of the people.
One challenge our industry certainly faces is of image. Let me ask you. Is public transport a public necessity or social responsibility? Except a few outliers such as Hong Kong, Japan or Taiwan, bus operations around the world operate with the help of public purse or subsidy. Can buses not compete on a commercial basis against other modes of transport? In most cities, millions of customers spend on an average over 30 minutes sitting in the bus every day. Try to name one mall or urban centre in your city which can be as attractive to as many people. If you want to start a new restaurant or a new store, you want to open at a place which is close to a bus station or a train station. Rents are usually higher at such places too. But public transport which creates value to such millions of businesses around the world has to struggle with cost coverage and financial assistance? Can this not change?
I believe it can and it should. I have lived in Hong Kong for past 25 years and worked in both railway and bus sectors and I am proud to say that we have proven that it is do-able. Every public transport operator in Hong Kong is profitable and operates without any direct subsidy from the Government.
Advancements in computing technology today also allow us to address many of the pain points which has led to current state of public transport. Sensors and data analytics can really transform our business in three key areas. Customer experience, operational execution and maintenance regime. Fare collection systems, social media and personalised app based interfaces have transformed the way we interact with customers. There is more data and information than ever before to make our proposition more attractive. MaaS or Mobility as a Service builds on these concepts and is already a growing phenomenon. MaaS creates a single platform for customer management, journey planning, service delivery and revenue management. On the operating side, telematics and GPS has allowed better fleet management, rostering, emergency responses and optimisation of other processes. On the maintenance front, predictive and prescriptive maintenance are becoming a norm.
Combined together, they can easily add 20-30% to the topline and cut 20-30% in costs. A simple math will tell you that this will make most bus companies around the world profitable. Let me tell you a real experience. One of Hong Kong’s big bus operators was making a loss of approximately 200 million Hong Kong dollars in 2012 when it made a concerted effort to turnaround the business. In 2016, it reported a profit of approximately 700 million dollars. Though a big part of this turnaround was related to the reduction in oil prices, the benefits of new data-driven strategies was significant. We installed telematics on the entire fleet of 4,000 buses and actively managed the data for optimisation. An extensive route and network planning saw a better fit between demand and supply patterns, and 7% reduction in operating bus miles without losing a customer. Between 2002 and 2012, the bus company had seen a drop in ridership of 18% but in just four years afterwards it recorded a growth of more than 5% despite lower bus mileage. In those four years, we also improved service reliability from 76% to 95% and vehicle availability from 89% to 93.5%. An app created the new customer interface, which was downloaded over 3 million times and recorded close to a million hits a day. We did not just carry 2.8 million passenger journeys per day but 5.5 million customers per month in a city of 7 million people. That kind of customer penetration competes with Facebook or Google. My point is that with right use of technology at our hands, we have the ability to make public transport appealing to all the segments of society. Why would anybody want to drive a car, when they can be chauffer driven in a nice bus? Currently driving time is unproductive. On a bus, you can work, read or check your social media.
Another technological advancement that has really scared the majority of the workers in the industry is automation and autonomous driving. Leveraging on artificial intelligence, machine learning and robotics, automation is perceived to create massive redundancies and unemployment, which means the very people who might be implementing these technologies may lose their jobs. There is an obvious pushback from the Unions and the employees.
Let’s take the example of bus drivers. Being a qualified bus driver myself, I can really sympathise with them. We call them drivers but is driving the only thing they do? He or she is the man-Friday on that vehicle and performs as customer service staff, safety and security staff, emergency assistance and evacuation, and many more roles. If a passenger gets injured, our bus driver is the first aid officer. I have known bus drivers who have assisted in delivering babies and saved lives.
Can we really have a bus with more than 50 passengers or more than 100 in case of double deck buses, travel without an operator on board? We all know that we are living in an aging world so our customer demographics will constitute more of older segment of population. More than assistance, they need an assurance of assistance. If technology allows us to relieve our driver from his or her driving duties, we must reorganise to strengthen other duties for him or her on board the buses. A more visible presence will also be reassuring to those who are mobility impaired. Many new tools have allowed this segment of customers to participate actively in the economy. While low floor buses, disability specific signals or applications have tremendously assisted them, a human touch can truly enhance the experience. Better customer experience can easily add 5-10% to the topline.
At the depot level, our research indicates that automation and robotics can be adopted for almost 60% of the back-end processes. This is not a threat but an opportunity. Mankind has gone through this transformation once before when we moved from an agrarian society to an industrialised one. The next transformation is towards an automated industrialisation. One clear advantage of adopting automation is almost no chances of errors which has a clear safety imperative. Service reliability shall improve, in-service breakdowns would reduce. The benefits are so enormous that their adoption is not a question of “if” but a matter of “when”. As you go around the busworld exhibition, you will see that almost everybody is talking about this one way or the other. The nomenclature may differ but look underneath and you will find that we are headed in that direction anyway.
The future, as they say, is electric. With a heightened consciousness about the environmental and sustainability issues, we have perhaps reached a point of irreversibility on that debate. China has shown the leadership by widescale adoption of the technology. Today China operates 98% of the world fleet of electric buses. You have to visit Chinese cities like Shenzhen or Zhengzhou to see the scale of this rapid change. China’s rapid adoption of electric buses is supported by state-of-the-art Command Centres which are collecting data and utilising them to continually optimise the operations.
Being a billion people market, China needs an average of over 120,000 buses per year just to replace the current fleet of buses through their natural cycle of retirement. If you factor in urban growth and improvement in quality of service, this number is only going to get bigger. Chinese bus manufacturers have already entered the international arena and many of them are here today at Busworld.
Add India to the equation, another billion people market, and numbers look staggering for the bus industry. India is also making a very vocal push towards going electric. Europe has taken an ideological lead by putting laws, policies, and funding mechanisms to support low-emission and electric buses. Most European cities are already running trials with electric buses. Many European countries have already adopted a no-fossil fuel strategy and many have announced their commitment to whole-heartedly adopt electric vehicles in next decade or so. Challenges remain with respect to the sources of power generation, mechanisms of distribution and charging facilities but they are not insurmountable if the right public policy framework is in place.
Now since we have overcome the range anxiety issues in urban environment, the future indeed appears to be electric for intra-urban travel. I am sure electric bus technology will advance sufficiently in coming few years to make inter-urban travel a reality. I have no doubt that public transport as we know it has a bright future, unless somebody like Elon Musk redefines distances by using his technologically sound ideas on making mankind a multi-planetary species and using the same rocket technology to travel between any two parts of the world in under an hour. I do not possess the foresight to predict what will happen then.
Ladies and gentlemen, it has been a pleasure to be here in this beautiful city of Kortrijk. Please enjoy the rest of the conference, busworld exhibition and have a great time.
Alok JAIN (email@example.com)