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Innovating out of the crisis: What next for transport?

Words by:
December 8, 2020

WA was joined by experts from across the transport industry this week to discuss the government’s response to the crisis so far and how, together, the transport sector can help accelerate a recovery fit for the future through innovation.

Panellists included Professor Phil Blythe, Chief Scientific Adviser to the Department for Transport, Emily James, Head of Public Affairs at Abellio Group, and Peter Stephens, UK Head of External and Government Affairs at Nissan.

Below we summarise the key themes that were discussed, including: the key drivers of innovation; those areas where more innovation is needed; and questions over how active or interventionist the government should be.

1. Decarbonisation is the key to unlocking a transport recovery fit for the future.

The single biggest driver of innovation is decarbonisation. Key to this is the Department for Transport’s Decarbonisation Strategy, which will be published in the first quarter of next year.

The first and most obvious port of call when discussing how to decarbonise the transport industry is the need to change the propulsion systems and fuel in our vehicles. Much has been said about the role that hydrogen must play in this, for example on the rail network in our trains, and the work being done by the Hydrogen Advisory Council, chaired by the Business Secretary. Though alternative fuels are being discussed, such as battery-electric technology, none are getting the attention hydrogen is. Hydrogen is the more politically appealing option according to Professor Blythe given the number of jobs it can generate, like the new Hydrogen Hub in Teesside, for example, and the fact much of it can be produced organically in the UK.

Another key mechanism through which the government can achieve decarbonisation is a reformed tax system, in Peter’s view. This will ultimately have to be the case, given the burning platform fuel duty now finds itself on alongside people increasingly switching to electric vehicles ahead of the 2030 target set by the government. What this new tax system looks like is unclear, but whether it’s some form of road/mileage pricing, in any case, Covid-19 has presented a big opportunity to reform the current way of taxing vehicles to be more effective in driving the right behavioural choices.

Area for improvement: ‘desilofication’

Despite the attractiveness of these new technologies/fuels, their success depends in large part on the extent to which they are understood in the context of the wider transport system. As Professor Blythe alluded to, energy systems need to be fully understood and done so alongside further developing innovative transport technologies.

The recent Energy White Paper, for example, may not appear too relevant to transport, but the scale of change required to electrify the rail network, provide national charging infrastructure for electric vehicles, or introduce significant numbers of hydrogen trains or buses will require fundamental changes to our energy generation and distribution sectors. The two cannot and must not be dealt with in siloes, as to do so would only slow down decarbonisation of the transport sector, according to Professor Blythe.

The same is also true of data. The government and industry cannot make informed decisions about how to join up transport modes more if it does not have visibility on key data, as this underpins everything, from an improved consumer experience to safer vehicles. As is the case currently, local authorities hold onto much of this data but are not making the most of it. The government must do more to make this available to third parties in as safe a way as possible to ensure its benefits are being tapped into.

The government’s role in providing the necessary leadership and industry guidance is huge if decarbonisation is to happen. Although full-scale government intervention is sometimes needed, especially when a market fails, Peter believed it more appropriate for the government to be more activist in its realising net-zero by 2050. We’ve been on this ‘decarbonisation journey’ for a long time now and the government must use everything it has at its disposal, including the plethora of alternative technologies and fuels available and the industry at large, to accelerate the journey further still.

2. Consumers no longer want what they used to want

Consumer expectations have changed dramatically throughout Covid-19. Increased working from home, a shift away from shared mobility and physical retail have all impacted our travel requirements and what we deem to be appropriate for our situations.

For example, Emily explained how Abellio is now looking to the future needs of its passengers, having first prioritised passenger and staff safety through more intense cleaning regimes, for example. Rail timetables have changed several times throughout this period whereas, historically, this only happened twice a year. The need to react quickly and be more flexible in approach is therefore critical to meeting these new consumer requirements.

Beyond this, no travel operator wants to have to rely on public subsidies to remain operational, she explained. Though there is an immediate need for it in the rail sector, for example, what is important is that travel operators can entice passengers back to public transport by offering the right products. For example, flexible ticketing reflecting the fact that not everyone will be commuting every day.

Room for improvement: redesigned consumer offer

The upcoming response to the Williams Review is a huge opportunity for this kind of innovative thinking to be applied, focusing first and foremost on new consumer requirements as opposed to anything else.

For the transport industry to adapt and, ultimately, survive, travel operators must invest time in fully understanding these new consumer requirements. Operators must take consumers with them in developing these new products, not only to ensure what they offer is cost-effective for the consumer, but as a way of reconnecting the public with public transport and its role in a more environmentally friendly and joined-up transport system.

3. Increased societal demand for change

Overall, consumers want to help with the government’s decarbonisation and build back better agendas according to our panel. Whether it is assisting with the transition to electric vehicles or the shift back to public transport, there is a renewed sense of societal obligation to help, something we saw lots of during the height of the lockdown. However, that is not to say there will not be trade-offs to be made. The public has had a taste of a better way of travelling which they will no doubt want to keep, such as repurposed road space or exciting new micro-mobility options.

Where possible, this needs to be harnessed and capitalised upon as soon as possible. To do this, a renaissance in transport is needed. For example, public transport needs to become the transport of choice again which will require a more relevant consumer offer. In doing so, we can start to lock down the opportunities that innovations present to us in achieving decarbonisation.

Room for improvement: clarity of message

The demand for change is there but the government must be clear to the public and industry about exactly what it wants to achieve when building back a sustainable transport system fit for the future, and their role within this.

Conclusion

The weeks and months to come will be significant for the transport industry. The need to showcase innovation, not only to adapt to these new consumer requirements but prove to government you have something to offer, will only increase.

WA is well placed to help companies engage with the various consultations and policy initiatives coming down the line and would be happy to discuss what this might look like in practice.

Contact: Marc Woolfson, Head of Public Affairs – marcwoolfson@wacomms.co.uk

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