Mobility’s second great inflection point

April 4, 2019


Here is a brief excerpt from an article written by Rajat Dhawan, Russell Hensley, Asutosh Padhi, and Andreas Tschiesner for the McKinsey Quarterly, published by McKinsey & Company. To read the complete article, check out other resources, learn more about the firm, obtain subscription information, and register to receive email alerts, please click here.

To learn more about the McKinsey Quarterly, please click here.

*     *     *

Radically new dynamics in the early 20th century transformed cars and, in turn, the world. Here’s why the next great inflection point is upon us, auguring changes no less profound.
There’s a well-known quote attributed to Henry Ford that he actually never said but that historians confirm he almost certainly believed: “If I had asked people what they wanted, they would have said faster horses.”1 The story resonates, of course, because we know what consumers circa 1900 thought mobility was supposed to mean, and we know from about 1920 onward what mobility in fact came to mean.And still does. Indeed, the extent to which Ford’s (and his contemporaries’) automobile paradigm has endured is remarkable. One hundred years ago, mobility conjured cars and trucks, a space to park and the price at the pump, city streets and open roads. And more: “the freedom machine,” mass transportation, car dealerships, internal combustion. Congestion. Accidents. Pollution.At the first great inflection point, the fundamental dimensions of transportation—cost, convenience, user experience, safety, and environment—saw “mobility” and “cars” become well-nigh synonymous. That was a dramatic shift from the previous several hundred years, when overland mobility meant horses, which people needed in ever-growing numbers. Emissions problems of a different sort than today’s were an unintended consequence. In 1894, the London Times ran the numbers: at prevailing rates, nine feet of manure would accumulate on city streets by the mid-1940s.2

A forecast in 1894 envisioned nine feet of manure on the streets of London by the mid-1940s.

The amazing developments of 1900–20 represented mobility’s first inflection point. They took us from steam to internal-combustion engines (ICEs), the “Great Horse Manure Crisis” of 1894 to “Big Oil,” and premium automobiles for the few to mass-produced cars for the millions. They also altered and even birthed entire businesses, industries, and government entities that developed alongside, but distinct from, the automotive industry: repair shops, highway authorities, gas stations, commuter railways, and car washes, to name just a few. The landscape has endured for decades.

But for how much longer? By 2030, we’ll see developments that may be as profound as those of a hundred years before. Radical changes—“horses-to-cars” changes, “how-we-think-about-mobility” changes—are coming, even faster this time, and across multiple dimensions. The characteristics of mobility at the second great inflection point will be significantly, not just marginally, better. Electric and autonomous vehicles, more interconnected and intelligent road networks, new customer interfaces and services, and a dramatically different competitive landscape in which tech giants, start-ups, and OEMs mix and mingle are just a few of the shifts in store. Radical improvements in cost-effectiveness, convenience, experience, safety, and environmental impact will, taken together, disrupt myriad business models on an almost inconceivable scale (exhibit).

With any luck, it will be what people actually want—not “faster horses,” but something qualitatively different and better. We call these coming changes mobility’s Second Great Inflection Point. In this article, we’ll explain why we think it’s coming, starting with a look back at the inflection point that took place 100 years ago, including its unintended consequences, and the forces at work pushing toward a new paradigm. A second, companion article lays out the likely characteristics of the emerging mobility ecosystem, along with the impact it is likely to have on business and society (see “Reimagining mobility: A CEO’s guide”).

As with many great changes, the picture is compelling both at a distance and in close-up. More than two dozen of our McKinsey colleagues, plus some of the executives leading the charge toward the future, provide the latter—snapshots of the technology shifts that leaders should have on their radar screen, the variations on this story in different geographies, and the ways in which cities as we know them are likely to change. Neither we nor anyone else knows exactly how or when these shifts will play out. What’s become increasingly clear, though, is that the change is coming much faster than most of us thought possible just a few years ago.

*     *     *

Here is a direct link to the complete article.

Rajat Dhawan is a senior partner in McKinsey’s Delhi office, Russell Hensley is a partner in the Detroit office, Asutosh Padhi is a senior partner in the Chicago office, and Andreas Tschiesner is a senior partner in the Munich office.

Posted in

Leave a Comment





This site uses Akismet to reduce spam. Learn how your comment data is processed.