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Micromobility Is thriving in the new safety economy | Greenbiz – GreenBiz

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Thanks to the coronavirus pandemic, the world is shifting from a sharing economy to a safety economy. As consumers emerge from their homes, they seem to be opting for the solitary and hygiene of their own cars, bicycles and walking. Even as economies reopen, given the new priorities, mass transit and other modes of urban transportation can look forward to tough times.

But it’s not all bad news. One mode hat will not have to wait for herd immunity is micromobility, a term used to refer to bicycle- or scooter-sharing enterprises. These services are already seeing riders return — for some cities, in increasing numbers. The reason? Bicycles and scooters are used outdoors, allow for social distancing and can be wiped down before use. 

According to a recent eight-nation survey Oliver Wyman conducted with some 6,000 respondents, 44 percent of riders said they would be willing to increase their dependence on the service in the future and 34 percent said they planned to use it as much as before the pandemic. Only 22 percent said they would decrease their use. Additionally, over a third of non-users said they were equally or more willing to try the service.

how share mobility may fare moving forward

Initially, the pandemic prompted some micromobility startups to close down operations in the face of stay-at-home orders, and demand pretty much dried up, according to a New York Times analysis of credit card data. That decline in ridership was driven as much by corporate decisions to shut down operations as it was by the pandemic. Resuming operations in bigger cities may be a smart first step to lure many riders back to the service. Those that have are seeing better numbers, attributed in large part to essential workers. In New York City, Citi Bike expanded service during the pandemic into the Bronx because essential workers needed alternatives to mass transit to get to their workplaces. Capital Bikeshare in Washington, D.C., also announced plans to expand. Both operations never closed during the pandemic, and both saw demand throughout.

Filling the gap

In the meantime, shared mobility services have had to look for revenue alternatives. To compensate for decreased ridership, some companies are adding or expanding delivery services for such items as food, medical supplies and groceries. 

Even before the pandemic, several large ride-hailing and scooter-sharing operations established relationships with popular food delivery services to enhance revenue. The pandemic made last-mile delivery more important to most city dwellers, looking for ways to get food, pharmaceuticals and other essentials without leaving the safety of home. For instance, in our survey, 42 percent of respondents said they were using online grocery shopping and food delivery services more or for the first time.

The new revenue from these operations is helping, but it is probably not enough to compensate for the decline in ridership caused by the coronavirus. For many ride-hailing companies, even a doubling of their food delivery business would only partially offset the double-digit drop in ridership globally.

Modeling safety

Contrary to what one might expect, the sharing and safety economies need not be at odds. Mobility companies that embrace a heightened focus on safety and work to reassure riders that they are watching out for their health are the ones that will emerge the strongest. For instance, many bicycle- and scooter-sharing enterprises announced implementation of extensive cleaning protocols, which include wiping down and spraying equipment regularly. 

To compensate for decreased ridership, some companies are adding or expanding delivery services for such items as food, medical supplies and groceries.

Similarly, ride-hailing companies altered their business model because of the pandemic, switching to door-to-door, single-passenger rides while discontinuing ride-sharing services. Despite continuing pandemic-related challenges, our survey shows that many travelers will come back to ride-hailing and car-sharing, with most saying they plan to use these services the same or more after the pandemic.

Respondents from countries where the pandemic was the worst were the least enthusiastic about returning to shared mobility modes, with respondents from Spain being the most negative about shared mobility services. In Singapore, where the pandemic has only killed 30 people, there was much less resistance to the idea of using them during and after the pandemic.

Based on our survey, it’s clear that the sharing economy has not retreated so much as it has morphed. In the new environment, micromobility looks set to take off as cities and consumers embrace its benefits. 

Alex LaValle, an associate at Oliver Wyman, contributed to this report.

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Canada to go big on budget spending as pandemic lingers, election looms

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By Julie Gordon

OTTAWA (Reuters) – Canada‘s Liberal government will deliver on its promise to spend big when it presents its first budget in two years next week amid a fast-rising third wave of COVID-19 infections and ahead of an election expected in coming months.

Finance Minister Chrystia Freeland has pledged to do “whatever it takes” to support Canadians, and in November promised up to C$100 billion ($79.8 billion) in stimulus over three years to “jump-start” an economic recovery in what is likely to be a crucial year for her party.

Prime Minister Justin Trudeau’s Liberals depend on the support of at least one opposition group to pass laws, and senior party members have said an election is likely within months as it seeks a clear majority and a free hand to legislate.

Furthermore, by September, all Canadians who want to be vaccinated will be, Trudeau has said.

Freeland has said the pandemic created a “window” of opportunity for a national childcare plan, and that will be reflected in next Monday’s budget along with spending to accelerate Canada‘s shift toward a more sustainable economy.

“It will be a green and innovative recovery plan aimed at creating jobs,” said a government source who declined to comment on specific measures. The budget will aim to help those “who have suffered most” the effects of the pandemic, the source said.

Critics say the government would be better to hold off on blockbuster spending because the economy has shown it is poised to bounce back, and to prevent the country from racking up too much debt.

“Clearly a garden-variety stimulus package is the last thing we need. This is pile-on debt,” said Don Drummond, an economist at Ontario’s Queen’s University.

“The risk is that at some point interest rates are going to go up and we’re going to be in trouble,” he said, pointing to the mid-1990s when Canada‘s debt-to-GDP ratio skyrocketed, leading to rating agency downgrades and years of austerity.

The Bank of Canada cut its benchmark interest rate to 0.25% to counter the economic fallout of the COVID-19 crisis and has said rates will not rise until labor market slack is absorbed, currently forecast for into 2023. That may change when it releases new projections on April 21.

EXPANDING ECONOMY

More than 3 million Canadians lost their jobs to the pandemic. As of March, before a third wave forced new lockdowns, only 296,000 remained unemployed because of COVID.

Despite still-high unemployment levels in hard-hit service sectors, the economy has expanded for nine straight months even as provinces have adjusted health restrictions to counter waves of infections.

“Once we see sustained reopening, we do think that the recovery will have quite a bit of momentum on its own,” said Josh Nye, a senior economist at RBC Economics.

“We think Canada‘s economy will be operating pretty close to full capacity by this time next year,” he said.

Economists surveyed by Reuters expect Freeland to project a deficit in the range of C$133 billion to C$175 billion for fiscal 2021/22, up from the C$121.2 billion ($96.7 billion)

deficit forecast in November. https://tmsnrt.rs/3wSJPcm

The deficit for fiscal 2020/21 ended in March is forecast by the government to top a historic C$381.6 billion ($304.5 billion).

Canada announced on Monday a C$5.9 billion ($4.7 billion) aid package for the country’s largest airline carrier, Air Canada, and said talks were ongoing with No. 2 carrier WestJet Airlines Ltd and others.

 

(Reporting by Julie Gordon in Ottawa; Additional reporting by Fergal Smith in Toronto; Editing by Steve Scherer and Peter Cooney)

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Economy

CANADA STOCKS – TSX ends flat at 19,228.03

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* The Toronto Stock Exchange’s TSX falls 0.00 percent to 19,228.03

* Leading the index were Corus Entertainment Inc <CJRb.TO​>, up 7.0%, Methanex Corp​, up 6.4%, and Canaccord Genuity Group Inc​, higher by 5.5%.

* Lagging shares were Denison Mines Corp​​, down 7.0%, Trillium Therapeutics Inc​, down 7.0%, and Nexgen Energy Ltd​, lower by 5.7%.

* On the TSX 93 issues rose and 128 fell as a 0.7-to-1 ratio favored decliners. There were 26 new highs and no new lows, with total volume of 183.7 million shares.

* The most heavily traded shares by volume were Toronto-dominion Bank, Nutrien Ltd and Organigram Holdings Inc.

* The TSX’s energy group fell 1.61 points, or 1.4%, while the financials sector climbed 0.67 points, or 0.2%.

* West Texas Intermediate crude futures fell 0.44%, or $0.26, to $59.34 a barrel. Brent crude  fell 0.24%, or $0.15, to $63.05 [O/R]

* The TSX is up 10.3% for the year.

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Economy

Canadian dollar outshines G10 peers, boosted by jobs surge

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Canadian dollar

By Fergal Smith

TORONTO (Reuters) – The Canadian dollar advanced against its broadly stronger U.S. counterpart on Friday as data showing the economy added far more jobs than expected in March offset lower oil prices, with the loonie also gaining for the week.

Canada added 303,100 jobs in March, triple analyst expectations, driven by the recovery across sectors hit by shutdowns in December and January to curb the new coronavirus.

“The Canadian economy keeps beating expectations,” said Michael Goshko, corporate risk manager at Western Union Business Solutions. “It seems like the economy is adapting to these closures and restrictions.”

Stronger-than-expected economic growth could pull forward the timing of the first interest rate hike by the Bank of Canada, Goshko said.

The central bank has signaled that its benchmark rate will stay at a record low of 0.25% until 2023. It is due to update its economic forecasts on April 21, when some analysts expect it to cut bond purchases.

The Canadian dollar was trading 0.3% higher at 1.2530 to the greenback, or 79.81 U.S. cents, the biggest gain among G10 currencies. For the week, it was also up 0.3%.

Still, speculators have cut their bullish bets on the Canadian dollar to the lowest since December, data from the U.S. Commodity Futures Trading Commission showed. As of April 6, net long positions had fallen to 2,690 contracts from 6,518 in the prior week.

The price of oil, one of Canada‘s major exports, was pressured by rising supplies from major producers. U.S. crude prices settled 0.5% lower at $59.32 a barrel, while the U.S. dollar gained ground against a basket of major currencies, supported by higher U.S. Treasury yields.

Canadian government bond yields also climbed and the curve steepened, with the 10-year up 4.1 basis points at 1.502%.

 

(Reporting by Fergal Smith; Editing by Andrea Ricci)

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