Vehicles

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EXPERT OBSERVER
The Australian Industry Group (AiGroup) Performance of Services Index (PSI) fell from 55.2 points to 53.7 points in November. The ‘final’ CBA/IHS Markit Services Purchasing Managers’ Index (PMI) fell from 50.1 points to 49.7 points in November. A reading above 50 indicates an expansion of services sector activity.
According to the AiGroup: “Among the business-oriented sectors finance &amp; insurance reported positive results, logistics (wholesale trade, transport &amp; storage) was stable, while business &amp; property services contracted. Among the consumer-oriented segments ‘retail trade &amp; hospitality’ and ‘personal, recreational and other services’ were positive (specifically, "robust growth"), while ‘health, education &amp; community services’ contracted slightly.”
The CBA/IHS Markit November PMI data
“November data indicated that the decline in business activity occurred amid subdued demand conditions. New business intakes continued to increase at a marginal pace. The underwhelming sales trend was centred around the external market, with services exporters reporting a further reduction in international sales. Anecdotal evidence suggested that drought-related disruptions and global trade war impacts had dampened demand for Australian services.”
New vehicle sales
The Federal Chamber of Automotive Industries reported: The November 2019 market of 84,708 new vehicle sales is a decrease of 9,152 vehicle sales or -9.8 per cent on November 2018 (93,860) vehicle sales. November 2019 had the same number of selling days (25.7) as November 2018 and this resulted in a decrease of 356.1 vehicle sales per day
The Passenger Vehicle Market is down by 6,228 vehicle sales (-21.3 per cent) over the same month last year; the Sports Utility Market is down by 442 vehicle sales (-1.1 per cent); the Light Commercial Market is down by 1,835 vehicle sales (-8.8 per cent); and the Heavy Commercial Vehicle Market is down by 647 vehicle sales (-17.4 per cent) versus November 2018.
Sales across states and territories over year to November: NSW (down 9.1 per cent); Victoria (down 10.6 per cent); Queensland (down 10.7 per cent); South Australia (down 14.9 per cent); Western Australia (down 0.8 per cent); Tasmania (down 9.5 per cent); Northern Territory (down 20.7 per cent); ACT (down 14.7 per cent).
The biggest selling vehicle in October was the Toyota Hi-Lux (3,687) from Ford Ranger (3,491) and the Mitsubishi Triton (3,123).
The rolling annual total of new vehicle sales in November was 1,066,156, down 8.8 per cent on the year – the biggest annual decline in a decade (year to November 2009). Passenger car sales fell by 17.4 per cent on the year with SUVs down 3.4 per cent and “other vehicles” down 6.6 per cent.
In the year to November, SUVs accounted for a record 60 per cent of combined SUV and passenger vehicle sales.
What are the implications for interest rates and investors?
The Reserve Bank is now in ‘monitoring mode’ until the February 2020 Board meeting.
The new vehicle sales market is still not showing the benefit of tax cuts, low interest rates or higher home prices – at least not yet. Auto-dependent businesses will continue to face short-term challenges but 2020 is looking more positive
CRAIG JAMES is the Chief Economist at CommSec
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New vehicle market still struggling: CommSec's Craig James

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GUEST OBSERVATION
E-scooter mania is sweeping cities around the world. Fun, accessible and cheap to rent, shared electric scooters are one of the biggest technology stories this year.
Their main appeal is that they are so easy to ride. A <a href="https://techcrunch.com/2018/12/23/the-electric-scooter-wars-of-2018/" target="_blank">flood of startups</a> offer on-demand services. Simply download an app, scan the barcode, ride and drop at your destination.
While this is a simple idea, it has caused a few problems.
When they reach their destinations, riders leave them and walk away. The scooters, <a href="https://theconversation.com/can-e-scooters-solve-the-last-mile-problem-theyll-need-to-avoid-the-fate-of-dockless-bikes-102633" target="_blank">like dockless share bikes before them</a>, end up cluttering pavements, cause friction with pedestrians and provoke <a href="https://www.youtube.com/watch?v=TIEKWxYp240" target="_blank">controversy</a> and debate.
E-scooters are the future of city transport and will reduce private car use, say the enthusiasts. They will ease congestion and help cities achieve their environmental and road safety targets, according to the optimists.
But for every supporter of these e-boosted contraptions, a dissenting voice says they are annoying and dangerous. Critics argue that e-scooters litter our footpaths, menace pedestrians and cause <a href="https://www.washingtonpost.com/technology/2019/01/25/electric-scooters-send-more-people-hospital-than-bicycles-walking-new-study-finds/?noredirect=on&amp;utm_term=.df3477b2b7ae" target="_blank">crashes and injuries</a>. One group in San Diego has even <a href="https://www.npr.org/2019/03/04/698768297/disability-rights-group-sues-san-diego-over-scooters-on-sidewalks" target="_blank">filed a law suit</a> claiming that scooters discriminate against people with disabilities.
Some <a href="https://www.vox.com/the-goods/2018/9/10/17631318/electric-scooters-bird-city-regulations-sustainability" target="_blank">cities have banned</a> e-scooters. In Australia, Brisbane City Council, while extending a <a href="https://theconversation.com/limes-not-lemons-lessons-from-australias-first-e-scooter-sharing-trial-108924" target="_blank">trial of e-scooters operated by Lime</a>, has <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2019-03-30/electric-scooters-riders-fined-safety-breaches-brisbane-qld/10956110" target="_blank">warned safety must be improved</a> before a permanent permit is granted.
Tiny vehicles, big impacts
The emergence of “tiny vehicles” includes not only e-scooters, but also e-bikes and other electric, low-speed, micromobility solutions.
If we take them seriously, these could be a huge deal for our cities. These emerging modes of transport can be quite effective for “first and last kilometre” travel (e.g. between home and your nearest train station). They can also help with short commuting distances less than 10 kilometres. An <a href="https://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/2071.0.55.001%7E2016%7EMain%20Features%7ECommuting%20Distance%20for%20Australia%7E1" target="_blank">estimated 20% of trips</a> from home to work in capital cities are 5-10km long.
<img src="https://images.theconversation.com/files/264254/original/file-20190317-28487-12hrqvi.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">
E-scooters could be “<a href="https://thenewdaily.com.au/news/national/2019/02/23/electronic-scooters-safety/" target="_blank">disruptive</a>” in that they would cut the number of short trips taken by private vehicles today.
In Sydney, around <a href="https://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/2071.0.55.001%7E2016%7EMain%20Features%7EFeature%20Article:%20Journey%20to%20Work%20in%20Australia%7E40" target="_blank">67% of these short commuting trips</a> (on average) involve private vehicles. The proportions are even higher in Melbourne (76%), Brisbane and Darwin (both 80%), Canberra and Perth (both 83%), and Adelaide and Hobart (both 84%). Across the nation, more than 85% of drivers who commute by private car don’t share with other commuters.
Shifting even a small percentage of these trips would help reduce reliance on cars, ease congestion and improve amenity.
<img src="https://images.theconversation.com/files/264255/original/file-20190317-28505-7gfu51.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">
Most commuters do not carry much on their journey to work – a purse, a backpack or similar. That makes tiny vehicles more appealing for the short commute because they do just the one thing: <a href="https://www.citylab.com/transportation/2018/06/welcome-to-the-tiny-vehicle-age/563342/" target="_blank">provide personal mobility</a> from A to B. Leather seats and posh interiors are not an option!
<img src="https://images.theconversation.com/files/264190/original/file-20190316-28505-q6t0ma.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">
E-scooters can help with first and last kilometre travel and short commuting trips. Volkswagen
Clearly, we are nowhere near mass adoption. That would require more <a href="https://www.citylab.com/transportation/2018/06/welcome-to-the-tiny-vehicle-age/563342/" target="_blank">variety of tiny vehicles</a> to suit all types of people, trips and weather conditions.
Nevertheless, there is no shortage of <a href="https://www.greencarcongress.com/2019/03/20190305-vwmicro" target="_blank">ideas</a> to solve these challenges. Many <a href="https://lastmile.zone/en/vehicles/streetscooter-and-vw-launch-their-own-cargo-e-bikes" target="_blank">solutions</a> will undoubtedly be imagined. Some might actually work!
<iframe src="https://www.youtube.com/embed/i3q44cnSFoI?wmode=transparent&amp;start=0" frameborder="0" width="440" height="260"></iframe>
 Startups are working on a variety of tiny vehicle solutions for different uses.
A regulatory sandbox approach
Regulation remains a major hurdle. Policymakers recognise that micromobility could be a driving force of change for our cities, but safety cannot be an afterthought. Instead of banning the emerging technology, many cities are adapting their approaches to handle it.
Rather than making up new rules without evidence, policymakers are using a <a href="http://www.govtech.com/opinion/E-Scooter-Bans-Show-Cities-Are-Hesitant-to-Embrace-Innovation" target="_blank">regulatory sandbox</a> approach. Borrowed from <a href="https://asic.gov.au/for-business/your-business/innovation-hub/regulatory-sandbox/" target="_blank">fintech regulation</a>, this approach allows startups to test new technologies for a specified period.
Businesses can learn quickly and respond to problems as they arise. Regulators can collect data to make informed decisions and prioritise interventions.
We already have examples of these partnerships.
<a href="https://www.recode.net/2018/6/26/17490378/scooter-sharing-companies-san-francisco-legal-permits" target="_blank">Companies are offering to pay cities a fee per scooter</a> to build protected scooter and bike infrastructure. Others have committed to providing <a href="https://sf.streetsblog.org/2018/09/21/return-of-the-scooter/" target="_blank">financial incentives</a> to encourage riders to park scooters properly. One company is offering a free ride to customers who park their scooters well ten times in a row.
To keep footpaths safe, businesses are also working with local governments to test ideas such as <a href="https://youtu.be/BmkRjtdtygk" target="_blank">retractable locks</a>, <a href="https://www.citylab.com/transportation/2019/03/electric-scooters-parking-charging-docks-lime-bird-lyft-spin/584332/" target="_blank">solar-powered parking</a>, <a href="https://www.recode.net/2018/6/26/17490378/scooter-sharing-companies-san-francisco-legal-permits" target="_blank">designated on-street drop-off zones</a> – even a <a href="https://www.fastcompany.com/90316775/is-it-time-for-scooters-to-be-put-in-their-place" target="_blank">“dock for dockless”</a> solution!
What’s next for the e-scooter market?
These products are not toys and investors know it. Venture capitalists are riding a wave of public acceptance and adoption.
E-scooter growth, in particular, has <a href="https://www.curbed.com/2018/7/24/17607698/electric-scooter-bird-lime-spin-adoption-transit" target="_blank">exceeded first-year adoption rates</a> for similar services such as bike-sharing and ride-hailing. In <a href="https://www.sacbee.com/news/local/article226640274" target="_blank">Sacramento</a>, where the same company offers both bike and car services, the use of shared e-bikes exceeded ride-hailing rentals by a 53-47% margin.
Businesses are betting that shared e-scooters will do to short-distance travel what ride-hailing did to the taxi industry. Globally, investors have <a href="https://www.mckinsey.com/industries/automotive-and-assembly/our-insights/micromobilitys-15000-mile-checkup" target="_blank">poured more than US$5.7 billion</a> into micromobility startups since 2015. New business models are emerging, with some companies considering annual memberships that include free ride time per day.
As with other fast-moving innovations, policymakers need to adapt their approaches. They also need to rethink bans and regulations that undermine the viability of e-scooters.
Tech companies need to prioritise rider safety over growth. They need to work with governments to preserve the sanctity of the footpath as a safe public space.
Without this, our cities will miss out on the potential of tiny vehicles and the opportunities they offer to reduce private car use.<img src="https://counter.theconversation.com/content/113111/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
Hussein Dia, Chair, Department of Civil and Construction Engineering, Swinburne University of Technology
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/banning-tiny-vehicles-would-deny-us-smarter-ways-to-get-around-our-cities-113111" target="_blank">original article</a>.
Main photo: Conceptual design of a vehicle parking bay as a designated drop-off zone for tiny vehicles. Lyft
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