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The keys to the revolution of small vehicles in cities. Is the boom coming to LatAm cities?

The revolution of small vehicles in cities aims to solve in a sustainable way the problem of circulation.

In various academic investigations, in books and even in a TED talk, the economist Sendhil Mullainathan popularized the concept of the “last mile problem” years ago. Mullainathan currently teaches in Chicago, went through MIT and Harvard and is specialized in behavioural economics and development. At a general level, the academic explains, many incentive schemes are set up so that the brightest minds and the highest salaries deal with the great guidelines of a project, but that end up failing or not reaching their potential because no one has the motivation to focus in the “last mile” of that initiative, that final 5% that involves the last details and the interface with the public.

Mullainathan found plenty of examples of “last mile problems”: airports of hundreds of millions of dollars where all are lost because signalling fails; state-of-the-art schools where a budget line was not envisaged for the salaries of teachers or hospitals where a state-of-the-art tomograph is broken and nobody knows where to get spare parts. For the American academic, from a strictly economic point of view, it makes much more sense to detect these “five for the peso” that do not work expensive projects and dedicate resources and talent to close those gaps that to think all the time big megaprojects from zero (which are what officials and CEO tend to privilege).

In transport economics there is a very interesting debate with axis in “the problem of the last mile”, but this time more literally. Instead of thinking of big highways, new generation planes, hyperloops or self-managed vehicles, there are those who believe that the real transport revolution will come from the side of smaller and less ostentatious protagonists.

The “micromobility revolution” includes electric scooters, battery-powered bicycles, segways and other small formats that aim to solve the problem of excess cars in large cities in a sustainable manner.

Those who promote this paradigm assure that half of the 15 trillion miles of travel made by the world population each year could be solved in this way. The technologist Horace Dediu, a fan of this move, points out that scooter rental platforms in large cities such as Lime or Bird are growing much faster than they did in that initial stage Uber or Lyft (and the speed of adoption up exceeds that of the iPhone). Dediu projects that by the beginning of 2021 micromobility will surpass the number of trips to the shared car travel platforms.

Most of the automakers made large investments in 2018 to buy micromobility startups (Ford, General Motors, Seat). There are three reasons that, according to Dediu, drive this trend. On the one hand, the massive adoption of smartphones means that digital platforms exploit the ocean of data and GPS technology to provide services much more efficiently (and, therefore, to close the associated business models). On the other hand, many large cities reached a point of critical traffic saturation due to excess vehicles. Finally, the sector is fashionable among venture capital funds, which see it as a relatively cheap alternative -in investment- and of very rapid growth.

For Regina Clewlow, a researcher who went through Stanford, UC Davis and Berkeley, the rent boom of electric scooters and bicycles in the last semester has a more inclusive bias (adopted by both women and men and a high proportion of low-income people they choose them) and are viewed with sympathy by 70% of the citizens of large cities. The neighbors fear that micromobility accentuates the phenomenon known as “gentrification”, which leads to an increase in the sale and rental prices of properties.

Are there chances to replicate this boom in Latin America cities?

In Argentina, the reform to the regulation of the traffic law that was made in January regulates electric bicycles as bicycles (before there was a legal vacuum) and incorporates the models of small electric cars (L6 and L7) so that they can be manufactured in the country. From there, companies such as Sero Electric made the first electric car entirely in Argentina and now manufacture functional (productive) vehicles for municipalities, industrial plants, and so on. In the Innovation Park, which will be done in Buenos Aires in 2019 – an initiative that the government of Buenos Aires leads Ignacio Stegman, former president of 3M-, cars can not circulate: the transfers in those fifteen hectares will be done on foot or with micromobility.

The journalist and probiotics activist Andrés Kilstein believes that “the growing number of bikes, folding bikes, skateboards and other elements even smaller to move show us the importance of simplification in urban life.” The car is inefficient in the occupation of space and generates costs, and although not all trips can be made on bikes, skateboards and others, there are many trips that can be added and many users eager to introduce this simplification in their lives.

The economist and transport innovation expert Leonardo Valente is more sceptical: “It is difficult to see skateboard startups at a local level, not so much because of regulations or permits, but because of costs and the possibility of vandalism, to which the inexistence is added of local or regional funds with enough money to bet on the hype, as I heard there, there is more money taking care of not being lost than taking care not to lose a good opportunity “.

“From the technological side,” continues Valente, “beyond the appearance of so many services in the First World generated a very rapid advance in the adoption of skateboards, the small diameter of the wheels of the scooter makes it difficult to transit on streets such as our with many potholes, ditches, donkey loins, bumpers, etc. I see much more likely the appearance of bicycle startups without a delivery station, as an evolution of the recently concessioned city system or as 100% private initiatives “. Valente was recently and for several weeks in Shenzhen, the Chinese mecca of innovation, where he was lost several times in parking lots of rented electric bicycles, given the thousands of units that had been stationed.

This economy of last mile transportation is a trend that few saw coming and that has its historical background. When the use of the automobile on a large scale was popularized at the beginning of the 20th century, horse sales were fired (against all forecasts), which served to complete the last part of the journey to reach the house from the end of the road beyond from which motor vehicles could not continue.

And there are urban economists who speak of a return to the “city of rebirth”, with narrow streets where cars can not circulate, in which public transport reaches the entrance and then the explosion of small electrical means would serve to complete that “last mile “until now underestimated in urban planning.

Also published on Medium.

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