Erik Swerts, MD Alphabet: ‘Mobility is at a turning point’
Just before the corona crisis hit Europe, the mobility supplier Alphabet ordered a mobility survey. We discussed the results with Erik Swerts, Managing Director of Alphabet Belgium & Luxembourg.
First, an overview of the most important results. The survey was held in the first half of February 2020 by the research bureau iVOX. 93% of the respondents indicated owning at least one car. A quarter of them has at least one company car in the household.
61% still use the car for commuting, 18% use public transport. Last three years, 8% of the car owners chose a smaller car, 3% a hybrid vehicle, and 2% a fully electric car. 2% of them already own an electric car for years, 1% a hybrid one.
These results are confirming the growing interest in ‘greener’ mobility. At Alphabet, this is confirmed by the fact that the total demand for electric and plug-in hybrid vehicles has doubled lately.
The study also showed some remarkable differences between the regions in Belgium. One-quarter of Brussels citizens, for example, doesn’t own a car, and practically everybody (93%) uses public transport. Of course, the urban environment plays a big role here.
72% of Flemish people use public transport, while in Wallonia, this is only 53%. When we look at commuting habits, 70% of the Walloons go to work by car, while half of the Brussels citizens use public transport.
Cycling is far more popular in Flanders than elsewhere. One-fifth of them even drives to work by bicycle, 12% on a normal bike, 9% electrified. The comparable figures for Brussels are 4% and 1%, and for Wallonia an almost non-existent 1% and 0%.
6 out of 10 respondents declared being unhappy about the mobility offer they have. 55% responded that they would like to use public transport for commuting, but that it’s practically not feasible.
The same frustration appears when you ask people about the mobility possibilities they’re offered by their employer. 34% would like to be offered a company car, only 24% are offered one. 56% would like a mobility budget; only 12% have the possibility.
45% would appreciate having an (electric) bike offered, only 17% can count on it; 29% would like an electric company car, a mere 7% can choose one. Even pool cars are far less offered (10%) than wanted (21%).
Looking for further comments on some of these results, we talked to Erik Swerts, Managing Director at Alphabet Belgium and Luxembourg.
“Every human is unique, and this is also seen in their commuting preferences. Three out of four want to decide themselves on their mobility possibilities. That’s why we think a panoply of mobility solutions for the employee integrated into one offer for the employer can surely help here,” confirms Swerts.
Just after the survey, the corona crisis hit the world. For sure, this must have its consequences too?
“The side-effects of corona on mobility were huge. That’s why we think that mobility in Belgium but maybe in the entire world is at a turning point. Is this the moment that teleworking is an option, now that we’ve experienced uncongested roads? A survey of 305 employers done in April shows that teleworking is now finally accepted.”
Has corona changed the world?
“Personally, I’m convinced that the world as we knew it before will never come back. I see the future of mobility as a mix of things. There is no unique answer. People will learn how to work from home, and they will like it, but they also need human contact. Human beings are not made to live or work completely on their own.”
How will Alphabet react to this?
“Alphabet was already a mobility provider. What we’re facing now is an accelerated shift toward other mobility solutions, reaching from teleworking over public transport, car sharing up to biking. People are ready for change now. When we launched strategies like Alphacity or Alphaflex, it was mainly the talk at receptions, “nice to talk about”, but now you will see the real interest.
Is this the end of the car era?
“Of course not. You won’t go quickly from 100% of cars to 20%. But other solutions will gain importance. Even before corona, we already had 2 500 bikes in our leasing park. We want a multi-modal approach, and you have the possibility to offer an incredible amount of solutions.”
“The need for comfort for the user/customer will be essential in the different mobility solutions offered. Do you know that the average value of our bikes is 5 000 euros? I thought it would be something like 1 800. It means that comfort is of paramount importance, independent of the actual solution you choose. Until now, it was the car that was always winning in this comparison, that’s changing now.”
Will Alphabet change its politics, considering what you experience?
“For sure, though we were already doing this. More so in other countries, Belgium was until now a very traditional, conservative market, but we were bumping into our limits just before corona. The return to this immobility is no solution for the future. There is no ‘back to normal’ anymore. Does everything has to be reinvented? No, a lot of inventive solutions already existed. Now, we have a combination of factors and forces that enables us to go through with it.”
Isn’t the whole lease market threatened by these evolutions?
“I already told you that the car won’t suddenly disappear. But, as you know, Alphabet is part of the BMW Group, and it’s certain that we will, also as a group, have to reconsider some things if we want to keep a leading position. We have to see the challenge of alternative mobility solutions as a challenge but also as an opportunity. This asks for an adapted, profitable business concept.
But in the end, there will be fewer cars to sell?
“The car will continue to play a leading role, whatever happens. More so, its use will be intensified; this is good for players like Alphabet. But manufacturers will be forced to compensate for the lower total number of sales. The car as a monodimensional object becomes an issue. That’s where we from Alphabet come in: our entire history is one of a service provider. We will continue to do that and enlarge our offering.
But that’s more difficult for a car manufacturer like BMW?
BMW is very aware of this challenge, and will also have to broaden its offer and its appeal. I know that this is something very difficult for a company like this, to withdraw onto the core business is tempting, but we have to think and react anti-cyclic, to ‘think out of the box’ to use a cliché. In fact, a ‘disruptive’ manufacturer like Tesla was very necessary. You can’t afford to be afraid of new things; you have to embrace them. I see parallels with e-commerce here.”
“At the end, the human behavior must be the thread in all things. You have to observe, you must analyze, and then you have to act as quickly as possible. It’s the only way to survive in these changing times.”