MaaS: The Profitability Problem

Mobility as a Service (MaaS) has an impressive list of prominent supporters and a sizeable customer base.

Popular startup apps, including Citymapper and Whim, are helping to cultivate a multimodal future. Millions all over the world use these apps and venture capitalists have invested significantly.

However, MaaS still struggles to be profitable.

The Problem
After reviewing the business model, a few obstacles come into focus:

  • App companies aren’t earning much of a commission.
  • The majority of non-vehicular urban transport is via public transportation, which is wary of the MaaS model.
  • Research suggests that most people will only purchase a MaaS subscription if it can cut their current costs by more than 30%, which is unrealistic considering that most car drivers underestimate those expenses.
    The good news is that the engineers who construct these brilliant mobility models are among the most innovative people on the planet. If anyone can pivot and figure it out, it’s them.

A Potential Solution
The solution to driving profitability for MaaS might be thinking outside the original model, which focused on individual consumers.

Selling MaaS Solutions to Employers
Instead of targeting individuals, Brussels startup Skipr is targeting employers. The startup is capitalising on the fact that most companies are no longer offering a company car.

This tax-protected benefit is increasingly frowned upon as it encourages workers to drive personal vehicles. The Belgian government now offers employers mobility budgets and tax benefits that incentivise more environmentally friendly micro mobility modes of transit.

Skipr then sells MaaS subscriptions to Belgian employers so they can easily track tax-protected trips.

Since the company car is a popular corporate benefit in many European countries, the market potential here is significant.

Patience is a Virtue
As MaaS providers continue to help the world visualise cities liberated from congestion, they might get some help from the most unlikely of places. In the wake of COVID-19, people are getting used to the car-free, or at least less congested streets they are seeing. Maybe they won’t want to go back.

Related Posts