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Anthony Okuchi - Modo
- 1. The trends ahead frank mckenna @frankiefoto Modo’s journey
- 2. There are many players now Our business has to adapt to more competition Peter Hershey @peterhershey
- 3. For all of us, competition remains the privately owned vehicle which continues to grow. Alexander Popov @5tep5
- 4. Vehicles are improving Lithium batteries prices are expected to slide by 67% by 2030. EVs will be cheaper in 7 years. Bloomberg New Energy Finance, 2018 Jason Leung @ninjason
- 6. Jonathan Gallegos @jonathangallegos We no longer see a need to move to pure EV fleets, but a combination of EV, Hybrid and IC vehicles. It will be about optimization.
- 7. Distracted driving is an issue 1 out of 2 Canadian drivers admits to driving while distracted Ipsos Reid Research, 2015
- 8. Oliur @ultralinx We are looking at ways to encourage members to not drive distracted, but we don’t have a clear answer yet.
- 10. We are experiencing an increase in damage per car, per year in the range of 10% to 25% over the coming years as a conservative estimate. Fancycrave @fancycrave
- 11. More work to keep cars on the road Modernizing our processes around damage Fancycrave @fancycrave
- 12. No more old school Our experience with technology innovation Adam Birkett @abrkett
- 13. Donald Giannatti @wizwow We have converted 70% of our cars to new technology in 5 months.
- 14. Ian Schneider @goian We are a mature organization Our experience with culture change
- 15. Crew @crew We are building an organization that is happy and agile. A team who is comfortable with constant change.
- 16. Members want instant service inexpensively Our business has to adapt to this need Rawpixel @rawpixel
- 17. Rawpixel @rawpixel More sophisticated stakeholders The community is evolving
- 18. Behind the scenes at Modo Our experience with the change
- 19. We need to continue to work together against the private vehicle and ensure our communities are thriving for our next generation.
Editor's Notes
- During this section of the presentation, I will be sharing some of the key trends that Modo is discussing and what we are doing to address them. For those that do not know us, we are a member owned cooperative which means that we represent a community service and return profits back to the members in the form of buying more cars for their use. After 20 years in this industry, we have learned a lot, but we also know that have a lot more to learn too. As a smaller but older organization, we contrast the larger and well funded car share operators and hope we can share some experience to the people that are smaller and share some wisdom from our years of experience.
- The industry is enjoying a surge of new players which has created more consumer choice for car sharing. For example, when one way car shares entered the market five years ago, it helped Modo grow due to the increased awareness amongst the public; We are seeing more conversations More discussions More buzz on car share. People are paying attention and its become an exciting place with lots of growth and change.
- In the end, its still about getting people out of their privately owned cars. Driving alone. Private cars are still winning and we need to all work together. This means reminding ourselves that although we compete sometimes, in the end we still need to work together to get people out of their private cars and create more sustainable communities. We are at a cross roads as leaders of this industry. As an ambassador of Modo, my biggest fear is that we lose sight of this larger community need, and instead focus on our internal competition for market share vs looking at the growth in private cars.
- For the first time, multiple long-range mid-priced EVs will begin to enter the market. Consumer demand is shifting in favour of electrified vehicles – around half of US and German consumers understand EVs which is demonstrating that we are passing the tipping point. By 2025, vehicles are expected to consume 50% less fuel than 2008 benchmarks. However, a trend towards larger vehicles in Canada is negate these improvements. Sources https://www.bloomberg.com/news/articles/2018-03-22/electric-cars-may-be-cheaper-than-gas-guzzlers-in-seven-years
- Toyota has prototyped a new Dynamic Force engine which is expected to offer 40% thermal efficiency. Most internal combustion (IC) gasoline engines operate at 20% efficiency. This means that IC engines will approach hybrid engine level fuel economy. Hyper fuel efficient gasoline engines approaching 56% thermal efficiency will run cleaner than an electric car using ‘well to wheel’ measurements by 2020. Mazda is prototyping such an engine with their Skyactiv-3. Trends are pointing towards IC engines enjoying a comeback with new technology rivalling EVs and Hybrids. Sources Toyota Develops Worlds Most Thermally Efficient 2.0Litre Engine, http://www.thedrive.com/tech/18919/toyota-develops-worlds-most-thermally-efficient-2-0-liter-engine, Mar 2018 Mazda Targets 56% thermal efficiency with Skyactiv-3, http://www.thedrive.com/sheetmetal/18037/mazda-targets-56-percent-thermal-efficiency-with-skyactiv-3, Jan 2018
- The combination of new technologies allows Modo to plan ahead for a combination of different vehicle types to address different needs of our members. For instance having EVs in inner urban dense regions, hybrids in the outlining suburbs, and gasoline engines for long distance trips. The implications for all of us that the future will likely be a combination of vehicle types and infrastructure to support increase use of car share. We don’t have to be married to EV infrastructure to sustain mid-term growth for the near term future.
- The impact of technology in the car is causing accidents Nearly one half (47%) of Canadian drivers admits to driving while distracted Seven in ten (72%) Canadians admit to performing some task in the car which could lead them to be distracted Best estimate is that 25% of all accidents in BC are associated with distracted driving Young drivers in the age category of 16 – 24 have the highest rates of cell phone use of any age group and more young drivers use cell phones, at any given moment on the roads, than all other age groups combined. Source https://www.ipsos.com/en-ca/nearly-one-half-47-canadian-drivers-admits-driving-while-distracted-driving-auto-pilot-45
- The answer is not easy. We are debating many projects; member awareness campaigns adding accessories into the cars dash cameras sensors to measure impacts. This signals a widespread problem which requires all stakeholders to help address due to the dangers that it creates.
- We’ve even considered drastic ideas to stop members from looking at their phones. Our only worry on this idea is the how to get rid of the smell of smoke from the car later.
- Trends show lower frequency, but higher severity The cost of labour, paint, and number of parts replaced is increasing 2010 Toyota Camry vs a 2015 Camry, the cost has increase from $3,143 to $3,559. The average part amount has increased from $1,693 to $1,955 and the average parts replaced has grown from 12.1 to 12.6 parts replaced. An average repair $750 more for a similar repair since the previous year, and trends are likely to continue For example; A 2010 Honda Fit Mirror was $267.97 – a 2017 Honda Fit Mirror is now $745.00 A 2010 Toyota Corolla Headlamp was $356.00 – a 2017 Toyota Corolla Headlamp is now $1370.90
- We are seeing greater trends towards a higher cost of repair. Modo has had to introduce innovation into our business to address this. We realized that claims processing velocity is key In 2018 we implemented the following; Member awareness/member devotion to reporting Staff training and education Clearer and simpler business process, a focus on reducing the number of staff involved, and clearer accountabilities Damage pipeline reporting to measure results We stopped the bleeding as we know cars will be more expensive to repair, members will drive distracted and in heavier congestion, and this problem isn’t going to go away over the short term
- Modo has built its own platform for the last 15 years with upgrades regularly. It was time for Modo to introduce a more innovative way of managing our fleet as much has changed in the area of fleet hardware and software management. We are in the midst of a major refresh with new code base However, technology is only the tool, the real innovation comes from how you use it.
- Introducing a new scalable and fast installation process. Enabling our call centre staff to create new processes because of the new system. Our experience on this is to always focus on the people and organizational change first to ensure speed of change.
- When I arrived at Modo nine months ago, much of what was passed on was through the apprenticeship model. When I asked how things were taught, it was taught by story telling, and through handing down experience one at a time. Although one person learned the answer, not everyone heard the same answer. As Modo grows, we found that it was unsustainable. Our leadership has been steadily introducing structure into our culture so that new staff learn quickly, and all staff learn best practices early.
- Modo has been around over 20 years. We are changing the way we do things. This means that we are experiencing significant culture change. We have been focused on creating a culture that is; Agile and adaptable Comfortable with ambiguity Has a willingness to challenge thinking The biggest innovation is in our people. We have been investing in them to get them ready for a car sharing economy that will have disruption in the near future.
- Members are increasingly wanting instant gratification Rather than commitment, there are looking for on demand services, They demonstrate this with last minute bookings vs reservations made in advance However, too many vehicles and this also causes social problems with congestion and consumers that stop using transit, walking, and bicycles too This means that as car share operators we all need to look at more flexible, last minute servicing of our users, but also realize we need to work with the transit ecosystem and not rob them of their ridership.
- We enjoy greater stakeholder awareness of car share around the world. Unfortunately, we need to focus on similar municipal bylaws. Modo makes 10 different styles of municipal car sharing signs, but we understand in Germany there is only one style. This creates confusion for our members who are driving across municipalities. Only so much that can be done without a stronger regulatory framework that is consistent across municipalities for car share organizations.
- We plan to modify purchases to include a combination of car types Design our model to be more instantaneous Connect our stakeholders Mange damage proactively Invest in our people Focus on efficiency But our innovation in the room will come from us working together to fight private car ownership as it still continues to win.
- Our best advice is to; Work with cities to standardize rules. Get ready for the changes ahead early. And remind ourselves that we are continuing to compete against private cars to ensure that our future generations thrive.