Article Highlights

Key Takeaway:

The incentives by the New South Wales government for Opal card users to combine public and private mobility providers could help riders navigate what is known as the “first-mile-last-mile” challenge of getting to and from public transit hubs. That is one of the things that providers of mobility-as-a-service, or MaaS, platforms are struggling to resolve.

Key Data:

The AU$3 credit the government is offering amounts to almost a full subsidy of the public transit portion of the trip for the low end of distance-based fares. For example, regular Sydney Metro and train fares are $3.61 for single-trip rides of up to 10 kilometers, and $3.20 for bus and light rail rides up to 3 kilometers.

Organizations Mentioned:

Transport for NSW
Uber
Lime
ingogo

A trial to be held later this year in Australia’s largest city, Sydney, if it proves successful, could offer one example for how agencies can encourage customers to take multimodal transport combining public and private operators. The economics behind the New South Wales government’s trial offer are unclear, however.

In what is considered a world first, 10,000 trial users of a digital version of Sydney’s closed-loop Opal card will be able to pay for the Uber ride-hailing service, Lime bike rentals and ingogo taxis. They will receive an AU$3 (US$2.28) credit to their Opal accounts if they travel on public transit, such as metro or bus, within 60 minutes of taking any of these private services. A separate offer would give customers up to 25% discounts on a private ferry service, also if they catch public transit within an hour. They reportedly could take the public transit rides before or after they take the private mobility trips.

The incentives could help riders navigate what is known as the “first-mile-last-mile” challenge of getting to and from public transit hubs. That is one of the things that providers of mobility-as-a-service, or MaaS, platforms are struggling to resolve.

New South Wales Minister for Transport and Roads, Andrew Constance, announced the trial this week, which expands on the features of a general pilot of digital Opal cards, which the government launched in December. 

“We know how convenient using one card is, and this is just the beginning,” Constance said in a statement. “If the (multimodal payments) trial is successful,we will look into rolling it out across the network, and we’ll be inviting other providers to get on board, too.”  

Constance reportedly said that the state is trying to reduce traffic congestion from automobiles so it is giving incentives or “cross-pollinating platforms” to encourage riders to go multimodal. At present, he said, it’s difficult for customers to get to where they want to go with only one transit mode, such as buses.  

Uber Australia’s general manager, Dom Taylor said the trial is a good example of “how government and industry can work together to deliver better ways to move people from A to B.” Uber’s app in Sydney has a trip-planning section that includes information on public transit. “Now they (customers) can use Uber to take the stress out of getting to and from a public transport hub and be rewarded for it as well,” Taylor said in a statement. 

MaaS backers have said that the private mobility providers, including such ride-hailing services as Uber and Lyft; and so-called micromobility providers, such as car, bike and scooter ride-share companies; pose a challenge for incorporation into MaaS platforms. That’s in part because of their different business models from that of public transit and difficulty in concluding commercial agreements with them. Public transit is expected to form the core of MaaS platforms. 

Definitions of MaaS vary, but most experts agree that they should enable users to plan, book and pay for door-to-door transport, usually on one platform, such as an app. To do that, the platforms usually have to incorporate one or more private mobility providers, depending on the city.

Another problem for MaaS platform providers is that some private companies providing mobility services, such as ride-hailing services, or TNCs, have been reluctant to share data they’ve collected on customers. That becomes a problem when, say, a customer uses the Uber app to book and pay for a transit ticket, which is possible in a small but growing number of cities. Transit agencies want the data for planning purposes, but have complained that the TNCs agree to share very little data with them, even on their own riders.  

Regarding New South Wales’ model for encouraging customers to take multimodal trips, including with private mobility providers, it’s questionable whether many transit authorities or governments would agree to subsidize rides like the New South Wales government is doing, at least with its trial. 

The AU$3 credit the government is offering amounts to almost a full subsidy of the public transit portion of the trip for the low end of distance-based fares. For example, regular Sydney Metro and train fares are $3.61 for single-trip rides of up to 10 kilometers, and $3.20 for bus and light rail rides up to 3 kilometers. Peak-time rides are higher, off-peak are lower. 

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