This Ministerial meeting, held in open session, focused on three lead questions: How is industry initiative transforming transport? How is the mobile world converging with mobility? And what are the key policy challenges of keeping pace with this changing world? The Open Ministerial included perspectives from three private sector leaders representing the automotive industry, ITS and railways.
Innovation is transforming the world of transport literally under our very feet. The subject of the means of transport is changing as innovative transport solutions are implemented, such as autonomous driving vehicles. With ever more data available, individual decision-making possibilities in transport are expanding, putting the power to decide on how and when to get from A to B into the hands of transport users, but also providing policy makers with previously unavailable information and tools to support their decision making.
Olof Persson, President and CEO of AB Volvo, emphasised the central importance of Information and Communication Technology for the future of transport. “Most transport systems today are efficient in theory”, Persson said, “but many are not utilised to their full potential.” This is where IT offers huge opportunities. Persson showcased examples of vehicle platooning and full electrification of public transport, noting that in both cases a strong and close cooperation between policy makers and private sector was required, notably with respect to pilot projects. This co-operation, to Persson, has four important dimensions: First, it has to be taken into account that transport networks usually involve infrastructure, which is in the public domain. ICT solutions in the vehicles only cannot be utilised to full potential if smart infrastructure is not introduced in parallel.
Second, consistency and stability in policy making is a crucial element in the viability of the private sector’s innovation business case. Third, the regulatory framework needs to keep track with the developments in the technology. Moreover it has to be sufficiently flexible to allow the introduction of innovations without requiring too much adjustment of the regulatory framework. Finally, while customised solutions are possible, the global harmonisation of technical and other standards is a necessary ingredient for a global success story with regard to transforming transport. It is here that the role of political leaders is most important.
The optimisation of the transport system through the use of IT in vehicles and infrastructure could reach even higher levels by having access to and using real time traffic data. Today, it is already possible to create predictive models of congestion based on real-time models, such as weather forecast, for days or even a week ahead, noted Bryan Mistele, President and CEO of INRIX, Inc. With big data becoming available in real time, it is now possible to look at traffic information globally and correlate it with other factors. For instance, there is multiplier link between GDP growth and congestion, with a 2% growth of GDP correlating to 6% growth in congestion and vice versa.
“Traffic congestion is a leading economic indicator. Hedge funds buy our data to predict economic activity,” explained Mistele. An expansion of data-driven solutions, which need no specific a priori regulatory framework or government support since they follow demand, is subject to ‘data democratisation’, i.e. the pooling and sharing of transport data, for instance between the public and private sector. Mistele acknowledged privacy concerns are a potential issue but expressed his conviction that these can be overcome by ensuring anonymity and using aggregated data.
Congestion will become an even more relevant topic than it is today, given the expected scenarios on urbanisation over the next decades. Latin America is a prominent example of this megatrend, with about 80% of the population expected to be living in cities in the next decades. In this context, Lutz Bertling, Chief Operating Officer and President of Bombardier Transportation pinpointed two important aspects which influence the spreading of new technology: Countries looking for new transport solutions should focus on defining the problem and let the private sector offer the best solution – often, this is not the case. “If you ask for a metro, what you will get is a metro”, he cautioned. “Don’t specify the solution, specify the problem.” And in the tendering phase, the selection criteria employed by governments should shift from the current focus on acquisition price to broader criteria that also consider life-cycle costing and even the total cost of ownership.
Guang Xu, Chief Engineer of China’s Ministry of Transport reported that his country had accelerated transport reform in recent years, since China is confronted with challenges ranging from environmental degradation, exhaustion of natural resources, rapid urbanisation, and traffic congestion to air pollution. With the transport sector being an important driver of development, there is increased pressure for its further transformation and upgrading. For the Chinese government, scientific innovation is the central strategy to reach this objective. There have been great achievements in areas such as building infrastructure, introduction of new energy vehicles or improved transport management integrating ITS and multimodal transport.
As an emerging economy with a rapid pace of advancement, China anticipates availing itself of the excellent platform the International Transport Forum offers to strengthen co-operation, draw on advanced experiences from other countries, accelerate innovation and promote the transformation of its transport sector. The government has identified smart, green and safe transport as the current and future development goal. Now efforts focus on deepening the implementation of this innovation-driven development and accelerating scientific innovation capacity. “We need to identify and intensify scientific innovation by promoting integrated transport systems, enhancing transport infrastructure modernity, building low-carbon transport systems, promoting modern logistics systems and improving safety and emergency response capacity”, said Xu, concluding that “as a symbol of human civilization, transport sector never ceases to innovate.”
Russia’s Deputy Minister for Transport, Nikolay Asaul elaborated on the theme of better use of data as a common thread running through the presentations from the business leaders. “We could reduce congestion by up to 10% on the basis of good information only”, he noted. “The public transport systems need to become more convenient.” Russia as the bridge between Europe, the Pacific and China is expecting to play a growing role in world transport as haulage operators try to optimise their logistics chains. In this context, the North-East Passage in the Arctic, the shortest maritime route between Europe and China promises to offer increased efficiencies. The route from Shanghai to Hamburg through the Arctic is 6 400 km shorter than through the Suez Canal and the Strait of Malacca, reducing travel time by up to 30 days. In view of a fuel consumption of ocean vessels of up to 60 tonnes of fuel a day, the economic benefits can be considerable.
Russia is maintaining a fleet of ice breakers to keep the Northern Sea Route open and in 2013 a total of 619 vessels used the arctic passage. Russia has developed its version of the Global Positioning System, called GLONASS, for use on this route and in December 2013 launched an emergency system for ship accidents based on GLONASS. This system has proven in a number of pilot projects to be compatible with European e-call system and it can increase efficiency and safety significantly.
Morocco’s Deputy Minister of Equipment, Transport and Logistics Mohamed Najib Boulif pointed out that it is not always easy from a political point of view to get support for new technology from the electorate. “The companies that drive innovation need to give [politicians] arguments that we can use in our conversations with the end users so they understand it is to the benefit of society and their own benefit when we introduce a new form of transport.”
Policy-makers are also often in a paradoxical situation where the different modes compete with each other, rather than seeking complementarity and optimal balance. Regarding the funding of projects, public money must be spent wisely and it is not always obvious how to set up funding in a way that supports the development aspect of transport investments while also giving the supplier a bottom line.
Reacting to Vice-Minister Boulif’s intervention, ITF Secretary-General José Viegas noted that regarding competition versus complementarity, both are needed to provide choice: “Whenever you provide a single option, too many people will feel left out.” But this also entails the challenge to include economic and regulatory signals which induce people to choose in a way that individual preferences align with societal interests. Regarding the economic impact of transport investment, Viegas, while agreeing with Lutz Bertling’s suggestion to consider the total cost of ownership, suggested going beyond that and considering economic impact in a way that includes an evaluation of indirect and catalytic effects. Methods for doing this exist and provide not perfect information but “a reasonably good perspective of the choices.”
In conclusion, Secretary of State Frédéric Cuvillier for the outgoing Presidency of France stressed the importance of meetings like the Annual Summit: “It is essential that we continue this dialogue because it opens up new perspectives.
