Covid induced innovation may lead to better outcomes

In 2018, I asked these questions in a post about Autonomous, Connected, Electric, and Shared (ACES) vehicles.

  • What if cities were designed to avoid traveling itself?
  • What if we redesigned work itself so that daily commuting was not necessary or was dramatically reduced?
  • What if all regular shopping was automatically delivered to the house?
  • What if the stores came to the buyer, instead of the other way round?
  • What if all public transportation was free?
  • What if all transportation was public transportation?

Of course I never imagined a pandemic was round the corner. However, the post would seem rather prescient now considering how some of these changes have come about. It is unfortunate that it took an event of such magnitude to force change upon us. Thankfully, it’s not just the pandemic that is causing change, but also increased awareness on environmental and social issues that is making people think about changing the status quo through business model innovation.

I will quickly recap some of the changes that I hoped to see that have come about since.

Working from home

I asked, why not redesign working itself so that commuting becomes unnecessary or dramatically reduced. The pandemic certainly brought this one home, and now some of the biggest companies in the world are ready to let employees work from home permanently. Of course there are both pros and cons to this, but anything that could lead to reduction on cars on the roads is welcome.

Shopping delivery

Weekly shopping trips to the grocery store were a mainstay of the North American lifestyle. I wondered why couldn’t all shopping be delivered to the house. And just look where we are today. Every grocery store now home-delivers. Companies like Instacart, Local Line, and Sysco are thriving. 60-minute grocery delivery is becoming common. Startups like Gorillas, Getir and Dija are promising an incredible 10-minute grocery delivery. Of course Amazon was the forerunner here with Prime and same-day deliveries. But these startups are completely rewriting the rules. Apart from grocery delivery services, food delivery services are going strong too. Ubereats, Doordash, Skip the dishes, to name a few, are becoming the norm. Ghost kitchens are springing up everywhere. Nuro, Refraction, and Starship are pioneering autonomous robotic delivery vehicles. Starship has already completed over 1 million autonomous deliveries. Deuce Drone is pushing for drone delivery. Amazon and Walmart are already experimenting with it. It is extraordinary, this transformation in the entire online shopping and delivery business.

Granted that some of these changes are likely to reduce as the economy opens up again, however habits are unlikely to revert back to what they were before the pandemic. Investors are definitely banking on this, as they are sinking copious amounts of money into delivery businesses. Some of these startups hold records for fastest run to Unicorn status.

Stores come to the buyer

Grocery Neighbor has taken local grocery shopping one step further with portable stores operating out of the back of trucks. This is exactly what I asked, “What if the store came to the buyer?”. This is incredible: pop-up stores at a whole new level. I do hope that this idea goes further, as currently it seems to be a bit eclipsed by the popularity of online shopping and delivery services. Initially large grocery stores were caught wrong-footed by the pandemic and the growth in online shopping and home delivery. But most have recovered admirably with the help of companies like Instacart and Sysco. So there is probably less incentive to take the store to the buyer.

Cooperative transportation

Car sharing has been gaining traction notwithstanding the demise of Car2Go (Share Now). There are several services for car sharing both for long and short term rentals. There are peer-to-peer car sharing platforms and corporate fleet-based ones too. One of the most innovative ones is Modo based out of Vancouver, which is founded as a cooperative. Yes, car sharing has taken a hit during the pandemic due to tranmission concerns, but the basic idea remains viable. The colossal waste involved in making automobiles that lie unused in parking lots and driveways is sheer foolishness.

It is well documented that on average 95% of car’s lifetime in North America is spent standing still. Remember, this is a pre-pandemic number, when there were no restrictions on travel. This is an eye-popping statistic that I am not able to come to terms with. Even if the mumber was lower, there is no other area of industry or life where such underutilization of an asset would be acceptable. Why are we ok with this? Electric or not, manufacturing cars that will lie unused does not make economic or environmental sense. A better model must emerge sooner or later.

It is my great hope that one day there will be no need to own private cars any longer. On-demand ride hailing, car sharing, and public transportation should give access to uniquitous mobility on demand that is as good as having one’s own car.

Free public transport

Luxemborg became the first country in the world to offer free public transport in Februrary 2020. Countries like Estonia and Beligum are taking the lead in offering free public transport in cities. This will go a long way in making private car ownership redundant. But countries continue to spend more on expanding road networks than they do on public transportation.

The biggest hurdle to change is us, the humans. Unless we change our behaviour and habits, there will be no lasting impact.

The idea that needs to be eliminated, is pride in car ownership. Automotive OEMs have folks enthralled with their advertising, much like De Beers did with their diamonds. Ideas of self-worth, identity, social status, and glamour are made dependent on which car one drives. But ownership and possession are human traits that are deeply ingrained over millenia. It will not be easy to change these fundamental human instincts.

However, we have seen attitudes change with sustained campaigning. Smoking is a good example, though it did take decades to bring people around to acknowledge the harmful effects of smoking. Fossil fuel use is seeing a similar change with governments and corporations increasingly committing to renewable energy. Car ownership is decreasing among the younger generation.

Ground transportation is the largest contributor to greenhouse gas emissions. Covid brought with it some forced changes that could lead to positive outcomes in the future. We should try to keep the momentum on these aspects that can help in reduction of emissions.