Course readjustment?New perspectives for financing tomorrow’s mobility

Traffic management 2.0

Why more and more municipalities are relying on innovative Cloud solutions

ITS magazineThe Magazine for Intelligent Traffic Systems

Issue 02 | 2015 | siemens.com/mobility

“ Suddenly the municipal bodies responsible for transport can campaign for quantifiable benefits instead of struggling to keep the losses to a minimum”

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Editorial | ITS magazine 2/2015

Dear Reader,

Across the globe, discussions about mobility financing have been mostly marked by minor-key tonalities so far. Even in established industrialized countries, people are lamenting about chronic investment backlogs, which in combination with growing traffic loads, keep causing ever lon-ger vehicle backlogs. Despite those laments, not much has changed over the past years. Public budgets remain tight in most places, and the roads congested.

Management consultants of the renowned London-based company Credo Consulting are now singing from a completely different song book, however. Their broad-based study “The Mobility Opportunity” is tuned to a major key, so to speak: In contrast to earlier studies of many of their fellow market researchers, the Credo experts did not focus on the

question of the economic costs caused by inadequate transport infra-structures, but they wanted to find out about the economic growth that major cities would be able to gen-erate by optimizing their mobility systems.

The interview with Chris Molloy and Matt Lovering shows that this minor, but decisive difference in perspective acts as a game changer: Suddenly the municipal bodies responsible for transport are not on the defensive anymore in their towns or cities, but can take over the baton and campaign for quantifiable benefits instead of struggling to keep the losses to a minimum. In other words: Chal-lenges are turned into opportunities.

The key messages of Dr. Knut Sauer and Professor Dr. Tony May, too, are definitely more optimistic than many recent public statements about

mobility financing. Neither the inter-nationally renowned consultant from Siemens Mobility Consulting nor the former President of the World Confer-ence on Transport Research see the oft-cited lack of finances as the big-gest barrier on the way to significantly more performant mobility systems. And while their respective lines of reasoning may differ in detail, in the end the practician and the scientist arrive at the same conclusion: It’s primarily our thought patterns that need changing.

As always, I wish you an informa-tive and inspiring read.

Sincerely

Markus Schlitt

“ Suddenly the municipal bodies responsible for transport can campaign for quantifiable benefits instead of struggling to keep the losses to a minimum”

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ITS magazine 2/2015 | Focus

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Focus

06 “A matter of 786 billion Dollars” Chris Molloy and Matt Lovering, the brains behind the study “The Mobility Opportunity” from the management consultancy firm Credo Consulting in London, talk about the growing competition for investors between major cities, and the big impact of urban mobility systems on the cities’ economic power

14 A question of priorities The mobility dilemma will not be solved by building new road infrastructure, says Professor Dr. Tony May. In fact, the former President of the World Conference on Transport Research suggests much more efficient options

16 Thinking out loud If we want to be able to pay for tomorrow‘s mobility systems, we need to throw away yesterday‘s thought patterns. It’s not only to public bodies that Dr. Knut Sauer of Siemens Mobility Consulting is addressing this call, but also to their private partners

Trends & Events

20 Charging made easier The speed at which electro-mobility will get estab-lished depends also and in particular on the available charging infrastructure – as much on its availability as its user-friendliness. This is why, under the European Green eMotion project, 42 partners have developed a virtual marketplace that makes vehicle charging as straightforward as using your mobile phone at home and abroad

22 Cloud-wise For some time already, innovative Cloud services have been playing an essential role in the daily work of IT professionals. Now these uniquely efficient services are about to conquer the world of mobility. Everything that a local technician needs to manage traffic flow on urban streets now fits into a pocket-size device

24 News Additional areas of application for the Stella 5 outstation; short reports from the Intertraffic Istanbul and the ITS Asia Pacific Forum

Content

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Partners & Projects

25 Shortcuts Recent traffic engineering projects in Sweden and Germany

Profile

30 “A clear case of either-or” Dr. Knut Sauer, globally renowned consultant from Siemens Mobility Consulting, on the emerging discussion about mobility pricing, the difficult tightrope act to balance public and private interests, and the urgent need for a fundamental policy decision regarding mobility funding

Know-how & Research

26 Switching cargo in minutes An innovative cargo handling system is to give combined goods transport a boost. Europe‘s largest automotive company is already operating its own CargoBeamer terminal on their factory premises

Rubrics

29 In the side-view mirror Reflections and lateral thoughts on the use(s) of money: “The burden of riches”

32 Imprint

Breaking the vicious circleNew thinking opens up new opportunities: If cities start considering their mobility systems as valid competitive element instead of as pure cost factor, they stand to gain hugely

Mobility & Living Space

28 Mere mind-games? The Siemens Mobility Division initiated its first contest for innovative ideas about how to improve everyone’s traffic experience. Clever inventors from 43 countries submitted their ideas in a neck-and-neck race for the medals

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Opportunity today

$ 362 bn ALL BIG CITIES(> 750,000 inhabitants)

786,000,000,000“A matter of

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Focus | ITS magazine 2/2015

Opportunity in 2030

$ 786 bn ALL BIG CITIES

(> 750,000 inhabitants)

Dollars”786,000,000,000

“A matter of

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ITS magazine 2/2015 | Focus

Mr. Molloy, Mr. Lovering, in Germany there is a saying that translates as “the money is lying on the street”. Do the results of your study “The Mobility Opportunity” charge this old proverb with a new meaning? Chris Molloy: I would not limit it quite to that extent, but would say that the money – or rather the economic opportunity – is within the ambit of the mobility system as a whole. Matt Lovering: In contrast to what the proverb suggests, it is not a simple matter of picking it up as you walk by. To exploit the opportunities that pres-ent themselves, a conclusive strategy is called for. The thing that our study makes plain is quite simply the size of the impact that the performance of a given city’s mobility system has on its economic power. This causal relation-ship has always existed, but today it is far more pronounced than ever before. In addition, thanks to intelli-gent technologies, there are more cost-efficient options for significant improvements.

What is the economic uplift that the world’s big cities could realize by optimizing their mobility systems? Matt Lovering: For the 35 cities whose mobility systems we analyzed in detail, our results show that they can boost their combined economic performance by about US$119 billion per year – with the potential economic gain even reaching US$238 billion as of 2030. Extrapolating to all big cities around the world, this suggests an enormous economic opportunity of

roughly US$786 billion annually. Chris Molloy: Taken in isolation that is already an impressive figure, of course. But it‘s only after calling to mind that this gain can be realized year after year after year that one gets a true picture of the scale of opportu-nity that we are talking about here.

How and on what basis did you compute this gigantic number? Chris Molloy: A quite decisive factor was of course to place a monetary value on the loss of time that people suffer as a result of inefficient trans-port systems. Anyone caught in con-gestion for instance is unable to work or deal with other important matters. For individuals, this may merely be a nuisance – but from the holistic perspective, it is only logical that the productivity of a city is diminished by it. This is why we examined primarily journey times, overcrowding of buses and trains and the density of transport systems in individual cities in fine detail. Matt Lovering: What is more: Besides a direct gain in economic perfor-mance, increased efficiency in the mobility system naturally also strengthens a city’s competitive posi-tion. Overall the city becomes signifi-cantly more attractive – for investors as well as for highly-qualified profes-sional staff.

Until recently, this competition was mostly among global mega-cities. Since when do we see increasing competition also between major national and regional hubs?

Chris Molloy: In fact, this competition has always existed. In England, at least for the past 150 or 200 years. At that time Manchester, Leeds and Liverpool were already in direct competition with each other in matters of attract-ing private companies willing to build factories there. However the thing that really is on the rise is the tremendous pressure that cities are subject to. Today it is more important than ever to emerge from this competition as victor. What is the role of efficient urban mobility systems in this increasingly competitive landscape, for instance in comparison to other important issues such as public security or power supply? Matt Lovering: In an ideal city all these areas must of course function well. This is why it is no easy task to set priorities here. In an earlier, broad-based survey, 27 percent of the inter-viewed investors gave the highest pri-ority ratings to the transport network, with public security and energy supply following far behind at six percent each.

Do you think that even before the publication of your study, the re-sponsible authorities in regional and national hubs had been aware of the enormous potential that they could open up by optimizing their mobility systems? Chris Molloy: Certainly a few, but far from all of them. I believe that the bigger a city is and the more efficient its transport systems already are, the

Interview Chris Molloy and Matt Lovering, the brains responsible for the study “The Mobility Opportunity” from the management consultancy firm Credo Consulting in London, talk about the growing competitive struggle for investors between major cities, and the big impact of urban mobility systems on their economic power.

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Warum der Verkehr in Städten so wichtig ist

Heute

Schon heute verursachen ineffiziente Verkehrsnetze volkswirtschaftliche Kosten für Städte, etwa durch verlorene Zeit und verringerte Produktivität ihrer Reisenden. Bevölkerungswachstum und steigende Pendlerzahlen werden den Druck auf die Verkehrssysteme in Zukunft noch erhöhen.

2030 projection

60%100 Mrd. € +40%Proportion of the world’s population living in cities

kosten Staus die EU jedes Jahr 1

Increase of commuters in 35 analyzed cities“ Our study provides

inner-urban transport experts with important arguments”

Downtown district in Shanghai: “For 27 percent of investors, the transport network has the highest priority, with public security and energy supply following far behind at six percent each”

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ITS magazine 2/2015 | Focus

“ Copenhagen, Singapore and Santiago are the best in their categories”

Freeway in Vitacura, Chile (right), entrance to the mass rapid transit system in Singapore: “Not even the cities with today’s top performing transport systems can afford to simply stand still”

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Personal background

Chris Molloy is the Managing Partner at Credo Consulting in London. He is an expert in strategy development and performance improvement across the business services and infrastructure sectors. He led the work for the study “The Mobility Opportunity” and presented the findings alongside Dr. Roland Busch at the World Cities Summit in Singapore in June 2014.

more municipal officers, at least among a city’s mobility experts, are aware of the enormous economic potential. Still, they do not always manage to have the appropriate influence on decisions about funding allocation to the individual budgets. In major cities, New York for example, experts have therefore welcomed our study because it provides them with a range of hard-hitting argu-ments in their discussions on inner-urban transport.

How many persons in charge of transport across the world did you talk to in total in order to arrive at robust results?Matt Lovering: Our study is based on a total of over 10,000 interviews – with officers from a range of organiza-tional levels in 35 cities of differing sizes. The thing that sets our investiga-tion apart is not just its broad data basis, but also the method employed for data evaluation, which we under-took together with several leading economic scientists. Chris Molloy: The verifiably high informative power of our investigation can also be ascribed to another fact, however: We didn’t calculate the untapped economic potential on the basis of fictional optimizations in the mobility field, but rather by using genuine figures that have actually been achieved in certain cities.

What were the key criteria used in the study to assess the quality of urban transport infrastructure?

Matt Lovering: We used a matrix spe-cially developed for the task. Besides detailed journey times, the salient performance indicators for a trans-port system were also recorded: from capacity to reliability and through to the degree of integration of the differ-ent transport modes. And of course, transport links to other cities similarly played a role. From all these data we then calculated the efficiency of the current network as well as – based on the future plans of the city under examination – the expected network efficiency for the year 2030.

In order to have a reasonable comparison, you grouped the cities under investigation into three cate-gories and then compared them to the leading city in their category. What are these categories? Chris Molloy: The first group consists of the established cities in Europe, North America, Asia and Australia. The second set comprises those compact, densely populated urban centers that are common in South-East Asia and recently also in the Middle East. And the third were the so-called up-and-coming cities, which sometimes dis-play incredible rates of growth, both economically and with respect to their population figures.

Which were the ‘best-in-class’ cities – and why are their mobility systems worth imitating? Matt Lovering: Among the estab-lished cities, Copenhagen is in the lead because there we find an optimally

integrated system that also appears to be perfectly prepared for future eco-nomic and population growth. From the compact centers with high popula-tion density we identified Singapore as Number 1, again not least because of the high degree of integration of the transport network and the reliability of the overall system. In addition, the ongoing transport optimization in Singapore shows very clearly that not even today’s top performers can afford to simply stand still. In the up-and-coming category, the top spot accord-ing to the results of the study goes to Santiago de Chile, where the past 20 years have seen continuous and totally cost-efficient investment in capacity. And the officials there have consistent future plans to take this development further – not least with the help of modern technology for traffic man-agement and traffic information.

In many big cities, prohibitive costs and limited availability of space make it virtually impossible to further expand the urban road network. Consequently, the use of innovative technologies is gaining in importance. To what extent are ‘intelligent’ traffic management systems deployed already today?Chris Molloy: Of course there are still enormous differences in this respect. On the one hand, when collecting the data for the study, we encountered some cities that already use a whole range of opportunities offered by modern technologies, not just to man-age their traffic flows better, but also

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Personal background

Matt Lovering is a Partner at Credo Consulting in London and leads the firm’s global transportation practice. He has almost 20 years of experience in advising operators, policy makers and investors across the passenger rail, airport and transport technology markets. For this purpose, he develops demand forecasts, commercial strategies and business cases for new transport projects.

Santiago

11%

New York

15%

London

15%

Copenhagen

9%

Istanbul

19%

Johannesburg

20%

Mumbai

22%Lagos

28%

Singapore

9%

Shanghai

13%Dubai

12% Hongkong

9%

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Focus | ITS magazine 2/2015

to improve air quality, for example. On the other hand we do have to acknowledge that in this field, many cities are still more or less at the beginning. However, this can obvi-ously also be seen as something posi-tive, because these cities are the very ones in which the deployment of inno-vative transport technology promises to have the greatest effect. As to the deployment of intelligent traffic management systems, were you able to identify specific key factors that are setting successful cities apart from the less success-ful ones?Matt Lovering: I would not like to reduce the cause for success to iso-lated factors. The strategic approach seems more important because one thing has emerged very clearly, I’d say: The more precisely the officials know in advance what they wish to achieve with the deployment of modern transport systems, the greater are the successes they deliver. It becomes dif-ficult when, for instance, officials sim-ply do not know exactly whether they wish to channel the current traffic

flows more effectively, or if they actu-ally prefer to reduce them. Basically, these are of course two perfectly legit-imate goals. But when no unambigu-ous priorities are set, the job of devel-oping effective concepts does not necessarily become easier. Chris Molloy: What certainly should not be forgotten are the political con-flicts within the cities themselves. By that I not only mean the decisions about budget volume and allocation, but also the concerns of certain man-date holders that road users may view some management measures as an attack on their personal freedom. But this will rarely be the case if citizens understand the benefits – including advantages for them personally – that modern traffic management promises. And, as the many positive examples demonstrate, these benefits usually become apparent very quickly, at least when conclusive concepts are available.

Can cities derive specific recommen-dations for action from the findings of the study? Matt Lovering: Definitely. After evalu-ation of the results we were able to formulate several quite concrete rec-ommendations. For example, every local authority should individually extrapolate the possible gain that they could achieve by the optimization of their mobility system – and adjust the level of their relevant investment according to the results. Equally important was the realization that investing in modern technology is very often the best and most efficient way

to generate fast and significant profits. And a further thing that we estab-lished was that mastering the future challenges of mobility will not be possible without raising the capacity of urban rail transport systems.

What kind of response did the publi-cation of your study trigger among the experts and professionals in the field, for instance also your interview partners? Chris Molloy: All of the feedback on “The Mobility Opportunity” suggests that it is seen as one of the most comprehensive and relevant studies undertaken so far. Besides the unpre-cedented breadth and depth of the sound data basis, city officials above all welcome the fact that for the first time, our study provides specific, truly quantifiable and easily comprehensible leads for their investment decisions in the field of transport.Matt Lovering: Basically the study achieved exactly what we wanted to achieve with it. A lively discussion has been provoked about the significance of mobility in urban societies, about the enormous potential of modern traffic management systems, and about the economic and political factors that either promote or hamper their deployment. If you would like to know what will finally emerge from this discussion, then perhaps we should talk again in three or four years’ time.

Mr. Molloy, Mr. Lovering, thank you very much for this interview.

Current transport costs in selected cities in relation to each country’s per-capita gross domestic product

“ Those who fail to set clear priorities don’t make matters easier for themselves”

Santiago

11%

New York

15%

London

15%

Copenhagen

9%

Istanbul

19%

Johannesburg

20%

Mumbai

22%Lagos

28%

Singapore

9%

Shanghai

13%Dubai

12% Hongkong

9%

Established cities

Densely populated urban centers

Up-and-coming cities

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A question of priorities

Essay Virtually everywhere across the globe, local authorities find themselves stuck in a dilemma: On the one hand, prevailing transport problems are hampering economic development; on the other hand, tight budgets are severely limiting the authorities’ scope of investment. This is one reason why the mobility dilemma will not be solved by building new road infrastructure, says Professor Dr. Tony May. In fact, the former President of the World Conference on Transport Research suggests much more efficient options.

50

45

40

35

30

25

20

15

10

5

Local safety

Smarter choices

Cycling

Concessionary

Local bus

Local roads

New light rail

HA roads

Rail

0.1 1 10

Source: Goodwin, 2010

Efficiency ranking

Benefit-cost ratio against expenditure for different types of policy instrument

Benefit-cost ratio

Spending (log scale) in billions of Pounds

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inevitably biasing the choices of cities and potentially leading to the implementation of less cost-effective solutions. In its seminal report on urban transport published in 2006, the then European Conference of Ministers of Transport argued that governments needed to rationalize financing and investment streams so that they are consistent across all modes.

Model-based predictions for Edin-burgh and Leeds identified a combi-nation of bus frequency increases, fare reductions, charging for car use, and low cost improvements in road capacity as the most effective pack-ages, with a net present value of between €3000 and €6000 per cap-ita when compared to current policy. When constrained to cost no more than current policy, the projected benefits were only reduced by around 10 percent.

Thus scarcity in funding need not be the huge barrier that it is often claimed to be. The decisive factor is how the available means are actually allocated: Governments should pro-vide finance for an overall strategy, leaving cities to decide how best to use it. This includes giving cities free reign in developing pricing schemes to send appropriate signals to users and as a source of finance. The cities in turn need to identify all potential sources of funding, make use of the full range of policy measures avail-able to them and develop interven-tion packages that are optimal within the funding available. This approach would immediately enable cities to do more with less.

Already five years ago, the European Commission started to encourage all cities to develop Sustainable Urban Mobility Plans. However, as several recent studies in the UK, Scandinavia and internationally have concluded, there are at least seven barriers to master along the path from theory to practice 1. Conflicting institutional roles, both vertically and horizontally2. Hesitant political commitment to the principles of sustainability and to the solutions needed3. Poor integration between the pol-icy sectors, and particularly between transport and land use4. Limited skills in option generation, and undue emphasis on supply-side solutions5. Inappropriate financing, both for plan preparation and for implemen-tation6. Limited public support, and a lack of experience in stakeholder involvement7. Poor data and lack of evidence of the performance of specific solutions.

Keeping in mind that all seven hurdles interact with one another, in this essay we will primarily discuss the fourth and fifth. Today, cities focus all too often simply on infra-structure investment, while over-looking other, potentially more cost-effective solutions. In his report to the UK government back in 2006, the renowned mobility expert Sir Rod Eddington pointedly concluded: “Unless a wide range of appropriate options is considered, there is a risk that the best options are overlooked and money could be wasted. A good option generation process is crucial to ensure that the transport interven-tions that offer the highest returns can be found. The full range of options should look across all modes and include making better use of the existing transport system, […].”

Four years later, the British trans-port researcher Professor Dr. Philip Goodwin collected and analyzed data on the cost-effectiveness of various intervention programs (see graph). For any type of policy inter-vention, the benefits of expenditure increase as spending increases, but at a declining rate. The best projects are those that have the best benefit-

cost ratios and should therefore be implemented first.

But the key message from the graph concerns the relative perfor-mance of different types of policy measure. By far the best returns are obtained from local safety measures such as implementing 30 km/h zones or intersection optimization, as well as from cycling schemes and ‘smarter choices’ measures encour-aging users to adopt alternative means of travel. Next come local bus service improvements and conces-sionary fares schemes, while infra-structure projects are typically much less cost-effective.

Even though the Goodwin study did not cover measures such as park-ing management, congestion charg-ing schemes or traffic management technology, previous findings sug-gest that these policy instruments too would have ranked higher in this comparison to pure roadworks proj-ects. In periods of austerity, most cities are finding their ability to finance transport improvements rather limited. This makes it all the more important to take the mes-sages from Eddington and Goodwin to heart, and focus on those mea-sures that promise the best return.

This leads us in turn to the fifth of the barriers above: inappropriate funding programs. A review of fund-ing in France, Germany, Japan and the UK found wide differences in the availability of funding for urban transport. What the four countries had in common was that it was eas-ier to obtain funding for some types of intervention than others, thus

Limited funds are not the big barrier that they are generally said to be – another decisive factor is how you go about finding the solution

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Thinking out loud

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of funding for this type of invest-ments: the World Bank, which in prin-ciple is quite open to such requests.

Of course, you frequently see such situations in developing coun-tries, where public-private coopera-tion often fails at the very first hurdle: political stability – or, more precisely, the legitimate demand of investors for a transport policy that promises an economically sustainable and successful operation of the system. It is only logical that no one will invest in a project if they do not know whether the promised revenues will still be flowing tomorrow.

But in emerging markets and industrialized countries, too, people do sometimes entertain unrealistic ideas about public-private partner-ships (PPP). Without naming any names, here is an example of a metropolis with millions of inhabi-tants that recently came to Siemens with the following “plan”: We want

Let’s start with the most important – and maybe also the most surprising – fact: The inability of mobility services to keep up with demand almost any-where in the world is definitely not due to a shortage of money. It is rather that so far no one has succeeded in per-suading those in control of the abun-dant financial means available to com-mit to this sector.

Just think of the pension funds in the United States, or of their counter-parts in Germany: While some con-ventional investment opportunities are out of bounds for these institutions because the risk is too high, other options are not attractive because the return is inadequate. If it were possible to convince the managers of these resources, which are available in prin-ciple, to invest in mobility projects, most of the problems would be solved.

But how does one go about con-vincing private investors to pay for transport infrastructure projects? As confirmed by a study of the World Economic Forum, what stands in the way, is usually the insufficient degree of maturity reached by these projects, which are typically under public aegis. That is to say, neither the entrepre-neurial risks involved nor the corre-sponding commercial opportunities can reliably be assessed on the basis of the facts listed in the correspond-ing tenders. Frequently the prospec-tive business cases are not clearly defined or rather unattractive for pri-vate organizations. By the way, the low degree of maturity is also the main barrier to the alternative source

Nobody will invest in a project based on a doubtful business model

Infrastructure investment If we want to be able to pay for tomorrow’s mobility systems, we need to throw away yesterday’s thought patterns. Dr. Knut Sauer of Siemens Mobility Consulting (see interview on page 30) is addressing this appeal not only to public bodies, but also to their private partners.

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to build a light rail line around our city. Are you interested in building and operating it? Questions relating to the projected passenger numbers, entrepreneurial scope or the specific business model all remained unan-swered. The only thing prepared was a contract, already on the table, ready for signing.

Even in industrialized countries, there are still plenty of misunder-standings with regard to how public and private partners can and should cooperate with each other. In Central Europe, for example, in most cases it plays out as follows: Project tenders are prepared and then simply thrown over the proverbial fence, to see what comes back. At this point, the overall concept has long been set in stone, regardless of any hidden economic stumbling blocks, unclear points or as yet unsolved issues. Advice from potential bidders? Not welcome! The cheapest offer gets the OK, and ten years later, people are wondering why everything has gotten out of control.

Why is that? The answer is that in many cases, public bodies do not see private companies as partners, but rather as mere suppliers. Suppliers of technology – but above all, of money. The responsible officials tend to for-get that a healthy business will never be interested in participating in a loss-making system. They pass up the chance to use the extensive expertise of private businesses to optimize their own plans and create more sustain-able solutions for our mobile society.

These days, there are new models for the procurement of complex ser-vices. The first such concepts come from Australia, and they all have a common denominator: You involve the technol-ogy suppliers in the project right from

the development stage and thus benefit from their experience. This means you get much more conclusive answers to those questions that always arise when investments are thoroughly checked as to their economic viability: What are the real long-term benefits? And in particu-lar: What will it cost over the entire life of the system?

It is well known that the latter per-spective is still largely missing from the considerations of those responsible for public budgets: For starters, they only focus on the initial investment, with operating costs and lifecycle costs not playing a major role at first. But the rethinking processes have already started: For some time now, the holistic approach has been seen as good form, especially with large turnkey tenders for projects in the Middle East.

In Brazil, too, people have been gradually moving away from the old ways of thinking. There the first ‘green’ rail route for freight is currently being planned together with Siemens Mobil-ity Consulting. The power for the elec-tric locomotives comes largely from sustainable power production plants along the 1,200-kilometer route. If the responsible authorities had only looked at the initial investment, the decision would certainly have been in favor of diesel locomotives, which are not only cheaper to buy, but can also run without any electrification of the line. But the picture changes com-pletely with a holistic approach to cost analysis: The higher speed of the elec-tric locomotives cuts the number of required locomotives and carriages by about a third, while also reducing energy consumption by around 90 percent.

Nevertheless, bearing in mind the public authorities’ typical approach to costs that still prevails in most parts of the world, technology providers also need to rethink. Creative solu-tions are needed that allow CAPEX, the costs of purchasing the system, to be converted into OPEX, i.e. operating costs. This is not really as unusual a task as it appears. For example, look at the subject of company cars: What company would hit on the idea of paying in full for its staff vehicles as soon as they are purchased?

For some time now, the specialists at Siemens Financial Services have been engaged in developing innova-tive financing models for customers. With a globally successful group behind them, they naturally have a lot of freedom and can afford to pro-vide funds up front. For instance, in the area of LED street lighting they recently started to offer the following model: The company installs state-of-the-art lighting systems at its own expense and then divides up the energy savings with the customer.

The members of the Siemens Mobility Consulting team act as cata-lysts in the design of new financing

What is needed are creative solutions to convert CAPEX to OPEX

New models for the procurement of complex services

Personal rapid transit system in Masdar City: Personalized advertisements are an easy-to-tap source of add-on revenue

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Focus | ITS magazine 2/2015

Siemens Mobility Consulting is cur-rently supporting a particularly complex project in the United Arab Emirates: the optimization of the mobility strategy for the futuristic eco-town of Masdar City, in Abu Dhabi. The focus is, as usual with such tasks, on the sustainability of the business models that have been planned for various transport services. In addition, however, the consultants have placed another issue on the agenda – generating second-ary business opportunities.

The starting point for these con-siderations was an in-depth analysis of the international airline business, which for more than 25 years has been operating under extreme pres-sures as regards both competition and productivity. Looking at the bal-ance sheets of the so-called low-cost carriers, what stands out in particular is that they no longer earn their reve-nues exclusively through the sale of seats to passengers.

Up to 50 percent of their revenues are now generated by additional activities such as advertising, catering or services related to baggage. Of course, the concepts developed by the airlines cannot be directly applied to public transport systems. But the

options. They offer consultancy ser-vices worldwide and therefore know exactly what challenges and oppor-tunities to shape the mobility of the future are present in each region. In developing and emerging countries, they help their clients raise the degree of maturity of their projects, and thus facilitate access to private capital or loans from the World Bank. In industrialized countries, they con-tribute their expertise in developing sustainable business models for mobility projects. In this case, the attribute ‘sustainable’ does not refer primarily to the projects’ environmen-tal impact, but rather to their long-term commercial success.

This is true for local rail transport systems as well as for innovative tolling solutions using satellite navigation, which operate without expensive detection stations and complicated wiring along the roads. The truck toll-ing system in Slovakia demonstrates the importance of far-sighted planning. The system was recently expanded to cover more than 15,000 additional kilometers of road – within just three months, during ongoing operation and without any investment in road-side equipment.

basic idea is certainly worth a second look. For example, in Masdar City, a zero-emission eco-town, the sale of CO₂ certificates could serve as a supplementary source of income. In addition, the transport authorities are planning a personal rapid transit system with autonomous, electric-powered cab vehicles that take the users straight to their destinations without any waiting time – an ideal platform for individualized advertis-ing messages.

LED street lighting: Siemens installs state-of-the-art lighting systems at its own expense

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ITS magazine 2/2015 | Trends & Events

EU project Green eMotion The speed at which electro-mobility will get established depends also and in particular on the available charg-ing infrastructure – as much on its availability as its user-friendliness. This is why, under a European Commission initiative, 42 partners have developed a virtual marketplace that spans national boundaries and is intended to make vehicle charging as straightforward as using your mobile phone across all EU countries.

As a warm-up, here’s a true story. Only the name is fictional, because it fits the topic so nicely. The Green family recently acquired an electric car, which they use as their second vehi-cle. Of course, “eMotions” played a major role in their decision. As well as a good environmental conscience and the sense of setting out as pioneers, the family enjoy some unique driving experiences: the total absence of engine noise, and impressive acceleration.

In practice however, some negative “eMotions” currently come into the mix. The range of a battery-powered car is limited, as is the number of pub-lic charging bays. Charging during a

journey becomes an adventure: “Will I make it there before the juice runs out?” This is the nervy question that accompanies Mr. Green on nearly any electric business trips that take him out of town. Because even if there are enough charging points along his route, it is far from certain that he will be able to simply turn up and use them. This is because the different public charging station operators use different billing systems. Mr. Green would therefore need several RFID cards, smartphone apps and user contracts to charge his battery on a contract basis or under a prepayment scheme at any of the available stations.

This is precisely why, in 2011, the European Commission kicked off its four-year Green eMotion project with 42 partners from the fields of industry, infrastructure, public administration and science. What emerged is a con-cept for networking the information and communications systems of all the firms involved into a single so-called marketplace. Thanks to systematic integration and real-time exchange of data it is possible to guarantee that any charging bay anywhere in the EU cannot only be used without a hitch, but can even be reserved in advance. That makes vehicle charging as sim-ple as making a cellphone call while

Charging made easier

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traveling abroad – roaming included. In this virtual marketplace both the European electro-mobility suppliers and their counterparts in the charging station business can join forces. The motorist merely signs up with the mobil-ity provider, who enables charging to take place quite irrespective of who actually operates any given charging bay. For this, the mobility provider draws up the bill either based on the volume of service provided or on a flat rate tariff. The charging station opera-tor in turn receives compensation from the electro-mobility provider.

As data from all networked charg-ing bays is collected in the virtual B2B

marketplace, the mobility provider can also offer motorists additional services such as searches for charging stations or reservations of charging bays. For the first time, this puts all players on the same network: mobil-ity users and providers, charging sta-tion operators, energy suppliers and providers of ancillary services. This not only enables Europe-wide tariffs, but the marketplace will also be open for further innovative services that have yet to be dreamt up by creative minds tomorrow and beyond, all in the field of emissions-free mobility.

The main advantage of the marketplace, which is implemented

under the Green eMotion project using flexible Cloud infrastructure from IBM, is the reduction in the number of interfaces between all parties involved. Open software ser-vices provide simple access to all tar-iffs and offers. As a routing system, the marketplace is also appropriate for the volume of data generated in a mass market and hence fulfils the conditions for a future-proof system solution. The ten demonstration regions in the Green eMotion project will continue to use the marketplace to test the functional capability of the concept. To this purpose, they link their IT systems via the open interfaces to the marketplace and can enable the clearing house service for Europe-wide roaming and the search for charging bays for their clients.

The bottom line is that Green eMotion has shown precisely what it set out to show: It is possible to effectively provide simple and conve-nient use of the European charging infrastructure for all users of electric cars. The project participants have defined the necessary architecture and interfaces and developed a dem-onstration system. Commercial oper-ators must now deploy a permanent implementation of the system for Europe. The involvement of multiple marketplaces is conceivable, in which case the task of networking the latter must also be accomplished. The basis for all this are standardized interfaces and business objects. The eMobility ICT Interoperability Innovation Group (eMI3) is an industry initiative working in this area which was established in 2012 in parallel to Green eMotion and involves an increasing number of partners from a range of sectors.

Our real Green family with its fictional name can therefore be con-tent. Their wish for limitless electro-mobility is rapidly becoming reality in Europe. As a result of Green eMotion, the future is the preserve of positive eMotions; the negative are soon to be a thing of the past.

EU Green eMotion project: Who, where and what?

In March 2011, the European Commission started Green eMotion, a four-year Europe-wide demonstration project to prepare the European market for electro-mobility. Ten demonstration regions distributed throughout Europe show what an interoperable and user-friendly system for electro-mobility might look like. Among the initiative’s 42 partners are industrial and automotive firms, energy suppliers, municipal administrations and universities as well as test and research institutes that provide, exchange and expand their knowledge and experience.

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ITS magazine 2/2015 | Trends & Events

Cloud-wiseMobility Services (part 3 of the series) For some time already, innovative Cloud services have been playing an essential role in the daily work of IT professionals. Now these uniquely efficient services are about to conquer also the world of mobility. Everything that a local technician needs to manage traffic flow on urban streets now fits into a pocket-size device.

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entire time at the control center any-more. With their smartphone at their side, they can simply stay at home and wait for any error alerts to come in by SMS. Then they can use the very same smartphone to analyze the malfunction and initiate the required troubleshooting measures. All controllers, detectors and parking space management systems are accessible with just a few keystrokes. “The city of Vienna with its roughly 1,800 signalized intersections has been using smartGuard for quite some time now,” says Bakir Bijedic-Hoffmann, director of the Support Center of Siemens Intelligent Traffic Systems. “And they are perfectly pleased with it – just as virtually every municipality that has opted for the system.”

Far more than 7,000 signalized inter-sections, detectors, parking garages and roadside stations have already been linked-up to Sitraffic smartGuard, and the numbers keep growing virtually every day. In Europe, the offer con-vinces not only small municipalities who cannot afford a traffic computer of their own, but also medium-sized towns and cities that want to benefit from secure mobile access to their

traffic control systems and equipment. And in emerging countries, where the establishment of modern high-perfor-mance traffic control infrastructure has only just started, Cloud solutions are meeting with growing interest too.

“For these countries we have designed a special package,” says Bakir Bijedic-Hoffmann. “Access to Sitraffic smartGuard is included in the purchase of our new Sitraffic sX con-troller.” Thanks to its multiple connec-tivity options, Sitraffic sX is something like a congenial partner device for Sitraffic smartGuard. The perfect inter-action of the two web-based compo-nents makes it possible, for instance, to integrate any newly-installed traffic light automatically into the system for direct display on the overview map.

However, this is definitely not the end of the technological revolution in service provision, of course. In fact, the journey has only just started. In their quiet labs at Siemens in Munich, researchers are already working on new versions that will go a step further. “In about five years’ time, we will prob-ably not even have to operate physical – and therefore maintenance-intensive – traffic computers here in Munich,” predicts Bijedic-Hoffmann. “Then the traffic computer itself will take the form of a cloud solution.”

The big advantage for the users: even higher availability levels of their traffic control systems. When every-thing happens in the Cloud, failures are practically excluded. If there should actually be a problem in one of the server farms, another can take over immediately.

Today, Cloud-based traffic control 2.0 is a profitable alternative for many municipal authorities

Every important trend will receive a name sooner or later. This one is officially labelled ‘servitization’, but on a less formal level, we could actually call it a ‘service revolution’: the strate-gic decision of innovative companies to shift from manufacturers of physical products to providers of integrated system solutions combined with lead-ing-edge services.

Operators and users of traffic control systems are certainly among those who stand to profit from this trend. “At the end of the day, our customers do not just want the devices that control traffic,” said Fred Kalt, who has global responsibility for service at Siemens Intelligent Traffic Systems, in a recent ITS magazine interview. “They simply want their traffic to flow.”

In the era of Cloud computing, there is no need anymore to operate the required hardware locally. Today, traffic control 2.0 is a worthwhile alternative for many municipal author-ities. In the present case, the traffic computer is hosted by Siemens Munich, including constant maintenance and regular updates. A Private Cloud pro-tected by multiple security rings offers the customers easy and convenient access to the system – just as if the hardware was installed right next to their desk. Since the payment scheme is based on the actual use of the individual functions, the municipal authorities will have no start-up costs for hardware and software. What is more, they neither need to hire highly qualified IT employees nor operate cost- intensive technical rooms and offices.

Secure and convenient access to the Private Cloud is made possible by Sitraffic smartGuard, an innovative software solution that runs not only on desktop PCs but also on tablets and smartphones. This is the reason why the new technology is of high interest also for cities that are already operat-ing traffic control computers of their own. Especially since, with Sitraffic smartGuard, everything that local traf-fic experts need to effectively manage traffic flow on urban streets now fits into a pocket-size device.

Standby duty, for instance, does not require the technicians to spend the

Sitraffic sX: The new controller is a congenial partner device for smartGuard

Sitraffic smartGuard: The innovative software provides access to the Private Cloud

Stella 5 No matter if used as a stand- alone solution or as part of an exist-ing or future system – the compact Stella 5 outstation offers maximum flexibility for the implementation of networked detection applications. More functions have been added to further expand the outstation’s field of application. For more road safety in case of low visibility due to fog or other ambient conditions, a local fog warning systems can be integrated on critical sections such as road dips or wooded areas to warn drivers of the danger. The first outstation processes the values measured by the ambient sensors and then can use any major commu-nication standard to transmit the results to the second station, which displays the corresponding warning on the variable message panels. When combined with a local speed warning system, Stella 5 can also be used to detect speeding vehicles and display the excessive speeds on a variable message sign to alert the drivers to the limit violation. In addition, Stella 5 can be used for the cost-effective realization of station-ary traffic counters that permanently record information on the traffic flow on the basis of vehicle-specific data.

True multi-talent

ITS Asia Pacific Forum 2015 This year’s ITS Asia Pacific Forum on April 27 to 29 in Nanjing, China, was already the 14th of the series and once again one of the most important annual events for the international ITS community. Like every year, the forum was a welcome opportunity for renowned and high-profile stakehold-ers from the transport industry and transport research to exchange experi-ences and intensively discuss current and future opportunities and chal-lenges in the area of mobility. Experts from Siemens China were of course in on the constructive dialogue and presented their latest solutions, for example the energy-efficient LED signal heads recently launched on the Chinese market.

Important dialogue

Intertraffic Istanbul 2015 200 exhibitors from 85 countries and more than 5,000 visitors – these were the impressive numbers for the eighth traffic industry summit on the Bosporus, which took place at the Istanbul Expo Center on May 27 to 29, 2015. Siemens was centrally involved in this showcase of the future, presenting a whole range of innovative solutions for the road traffic of tomorrow. Exhibits that met with the visitors’ special interest included, for instance, Siemens’ intelligent parking guidance system as well as adaptive traffic management applications designed to optimize urban trans-port, or state-of-the-art street lighting systems that very quickly pay for themselves thanks to very high energy savings. Other focus topics at the exhibition were the modern Sitraffic ITCC tunnel control center for coordinated control and monitoring of the entire technical equip-ment of road tunnels, and the fully integrated Sicore camera system for automated number plate recognition, which opens up numerous options for implementing new traffic management applications.

Inspiring summit

ITS magazine 2/2015 | Trends & Events

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Partners & Projects | ITS magazine 2/2015

Hamburg On the grounds of the port of Hamburg, a new ‘smart’ traffic signal system will enable the implementation of coordinated green phases to speed up truck traf-fic. For this purpose, various digital technologies are interconnected via WLAN so that the trucks can commu-nicate with traffic signals, road signs and roadwork sites. An approaching truck convoy informs the smart traffic signal of its imminent arrival, the green phase timing is adapted accordingly and the trucks can pass without stopping. Moreover, RFID technology (Radio Frequency Identi-fication) is used to detect the pres-ence of pedestrians, cyclists and pas-senger cars in the intersection area and inform the trucks accordingly. This will help prevent accidents. For the implementation of the project, the Hamburg Port Authority (HPA) relies on the expertise and know-how of NXP Semiconductor and Siemens, as well as on the city-owned com-pany Hamburger Verkehrsanlagen, which is responsible for the city’s traffic signals, street lighting and other technical traffic infrastructure.

Duisburg Joint development of innovative concepts for optimizing traffic flow at multi-modal inter-sections is the objective of a coop-eration agreement signed by Duisburger Hafen AG and Siemens Mobility in May 2015. One of the first measures will be the gradual

introduction of Siemens’ intelligent flow control system known as “Integrated Truck Guidance (ITG)” on the grounds of the world’s largest inland port. The system will collect regional real-time traffic data and forward them to mobile devices and LED traffic information boards to

provide incoming truck drivers with precise data and enable them to travel directly to the nearest free loading area or terminal. This will help further increase the efficiency of goods transport in and around the most important logistics hub in Central Europe.

Stockholm In Sweden, in coopera-tion with the truck manufacturer Scania, Siemens is deploying the first European demonstration project for the eHighways system, a holistic con-cept for electrically powered goods transport. For this purpose, a 2-kilo-meter stretch of the E16 highway north of Stockholm is being equipped with a catenary system. In a first stage, hybrid-powered trucks will operate on this stretch. The test results will be available two years from the start of the demonstration phase and are expected to show the system’s suitability for future commercial use. The introduction of electrical goods transport on the road could help Sweden to reach its ambitious climate protection goals, which stipu-late, among other things, that the national transport sector should become independent of fossil fuels by 2030. “The eHighway is twice as effi-cient as internal combustion engines. This does not only cut energy con-sumption in half, but also substantially reduce local air pollution,” says Roland Edel, Chief Technologist at Siemens Mobility. “The electric hybrid is the first step on the road to electrically powered vehicles, which will come to

play an increasingly important role in the development of sustainable freight transport.” Already in summer 2016, the test results from the eHighway demonstration project in California are expected to be available. For this first ever installation, Siemens is working with vehicle manufacturer Volvo on deploying the system on approxi-mately three kilometers of highway near the US ports of Los Angeles and Long Beach. The high potential of the eHighway concept is underlined by the Special Mention that the system was rewarded with in the scope of the Promising Innovation in Transport Awards ceremony at the International Transport Forum in Leipzig, Germany.

Cooperative traffic lights

Efficient hub

European premiere

An intelligent flow control system guides the trucks quickly and directly to their destination

eHighway test section in Brandenburg

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ITS magazine 2/2015 | Know-how & Research

Switching cargo in minutesCargoBeamer For some time now, all the signs point to intermodality being the future for passenger transport. However, the semi-trailers, which carry the bulk of freight, could not yet simply be shifted from road to rail. An innovative cargo handling system could change all that. It promises significant benefits for both the logistics industry and the environment. Europe’s largest automotive company is already operating its own CargoBeamer terminal on their factory premises.

from the industry regarding our approach has been very positive, almost right from the start.”

And it didn’t simply stay with posi-tive responses for very long: For two years already, Volkswagen AG has been operating a private CargoBeamer terminal on its factory premises in Wolfsburg, which, given the importance of effective supply chains for the auto-motive industry, is a kind of accolade for the practicality of the system. Thanks to a cooperation agreement between CargoBeamer AG and BLS Cargo, semi-trailers have been used for rail transit across the Alps since the second quarter of this year. Previously such transport was only possible by road.

More terminal locations are being planned in Germany, France, Poland and Italy. “Technologically speaking,” says Dr. Weidemann, “I anticipate no difficulties with these projects at all – the biggest challenge in implementing our concept has always been the bureaucracy. Waiting for planning approval processes in Central Europe means that you usually need to be

Good old Scotty from the utopian world of Star Trek would probably not have called it ‘beaming’. But if you look at the complex situation in inter-national freight transport, it soon becomes clear why the new cargo handling system for combined trans-port by road and rail is called Cargo-Beamer.

So far it has been impossible for semi-trailers to switch from truck to train, unless they have been fitted with special additional equipment so that they can be lifted by crane. Yet semi-trailers account for more than 70 percent of road transport. And for good reason. In so-called mega-trail-ers with an interior height of three meters, for example, three box pallets or flat pallets can be conveniently stacked one above the other. Conven-tional containers that can be loaded onto ships, trains and trucks by crane with equal ease simply do not offer nearly enough space for that. How-ever containers win out in economic terms, especially in overseas trans-port, where they can be built into

those imposing towers we see on giant ocean-going container ships.

So it is hardly surprising that the modal split for freight – based on land transport – currently looks like this: In Germany, rail transport has a share of just 17.4 percent of the 550 billion tonne-kilometers esti-mated for 2012, while on the other hand road transport comes in at a whopping 75 percent. Combined transport, which mainly consists of transporting containers to and from the seaports, has not even managed to reach the six-percent threshold until now.

But if Dr. Hans-Jürgen Weidemann has anything to do with it, this figure will soon triple. “At least that’s our vision,” says the CEO of Leipzig-based CargoBeamer AG. “And I think we have quite a good chance of reaching it too. Because using our system not only brings the logistics companies significant environmental advantages, but also real economic benefits that will come through on the bottom line. The feedback we have received

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patient for between five and eight years.”

The biggest selling point of this innovative cargo handling concept is its efficiency. It is basically suitable for all types of semi-trailers, whether mega-trailer, tank, silo or refrigerated semi-trailer. The truck driver simply heads for the CargoBeamer terminal. He sets the semi-trailer down on a waiting wagon base, a kind of “pallet” – and the freight is largely ready for transport by rail. As soon as the train arrives, it is loaded and unloaded in one operation. In a fully configured terminal it takes less than 15 minutes to load 36 semi-trailers.

First, guide arms in the track posi-tion the train cars in the right loca-tion. The pre-loaded “pallet” is raised, placed on so-called shuttle bars and positioned on the car. Up to 72 semi-trailers can be transshipped simulta-

neously. After the side walls are folded up, the pallet is lowered and securely locked in place. The side walls are locked, and the sidewall swivel units are run out of the load-ing gauge. After final inspection by the wagon master, the train leaves the terminal after just one hour.

Depending on capacity require-ments, the system can be supplied in smaller sizes. “Basically,” says the intellectual father of the concept, “You can set up a cargo handling ter-minal in a backyard of just 20 meters by 20 meters.” The modular design allows it to be adapted to the partic-ular circumstances: Each module serves one train car, so loading a complete freight train requires 36 modules. However, because the cars can couple to the trains individually, at a minimum a single module would suffice.

Dr. Weidemann estimates that the system becomes profitable at about five trucks per transshipment unit per day. He calculates the average savings for logistics companies at five to ten percent – a rather attractive figure bearing in mind that the mar-gins in this industry tend to be signifi-cantly lower. “It is not uncommon for the amount to be much greater. In the best cases, it is even possible for the savings to reach as much as 30 percent. That is because different tonnage limits apply in combined transport, allowing the shipping com-panies to take 15 percent more cargo. Besides, they don’t have to bother with driving bans on Sundays and public holidays as well as toll charges on the highways and will be able to double the capacity of their tractor units in a regular two-shift operation at the site.”

Efficient transshipment concept: The truck driver sets the semi-trailer down on a waiting wagon base, a kind of “pallet” – and the freight is practically ready for transport by rail. As soon as the train arrives, it is loaded and unloaded in one operation. A full-scale CargoBeamer system can transship up to 72 semi-trailers simultaneously

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ITS magazine 2/2015 | Mobility & Living Space

Mobility IDEA Contest “There is nothing more powerful than an idea whose time has come” is a famous aphorism attributed to French thought-leader Victor Hugo. Since this is also the hope of Siemens Mobility, the Division initiated a contest for innovative ideas about how to improve everyone’s traffic experience. Clever inventors from 43 countries submitted their ideas in a neck-and-neck race for the medals.

According to recent statistics the aver-age urban commuter is stuck in traffic for an estimated 34 hours a year, with more than 7 billion liters of fuel burned to now avail. Hard to say what part of the fallout is worse – the eco-nomic loss or the negative environ-mental impact. But if statistics like these show one thing clearly, it’s that innovative, even revolutionary flashes of inspirations are in greater demand today than ever if we want to solve present and future traffic challenges.

This is why last year, Siemens started its “Mobility IDEA Contest – Improving Design and Engineering for All”, a new challenge open to creative minds from all over the world. From the start, the great international response turned the contest into something like the Olympic Games for Ideas: Within the registration period, participants from a total of 43 coun-tries submitted a wealth of ideas, which were then subject to a qualify-ing process involving multiple stages: In one stage, for instance, internal experts discussed the selected ideas; in a subsequent stage, users visiting the website were invited to evaluate the ideas and discuss various aspects

Amir Ehsani Zonouz: The winner of Mobility IDEA Contest suggests the use of quadcopters to help with the search for a parking space

Mere mind- games?

Quadcopter locates the best available space using image processing algorithms and finds the shortest path to that spot Technology guides cars to

the optimal spot based on time and location

The use of thermal/infrared cameras allows quadcopters to work and fly at night

Quadcopter scans for a disabled-parking permit and guides the car to an open spot

Quadcopter monitors for suspicious activity and occupant heatstroke

Quadcopters communicate wirelessly to provide accurate data

a

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Mobilität & Lebensraum | ITS magazine 3/2014

with the idea owners. A little over a dozen ideas managed to reach the decisive stage, where they were evalu-ated by a top-flight jury panel com-prised of Siemens managers, experts from the industry and users.

And the winner is: Amir Ehsani Zonouz, who studies at the University of Massachusetts in Dartmouth, USA. He had been inspired by the daily search for a parking space to think about utilizing a network swarm of so-called quadcopters (autonomous mini-helicopters with four rotors) as scouts. In the scenario he describes, these special drones are able to quickly detect the nearest free parking slot and guide the driver to that spot, either via a mobile app or by sending the corresponding information directly to the car’s communication system. For reliable detection by night, the quad-copters can be equipped with infrared cameras, so that that even for 24/7 service, no investment in road infra-structure would be required.

The winner of the silver medal is a US student, too: Sakib Khan from Clemson University in South Carolina convinced the jury with his idea for a sophisticated technology for making pedestrian crossings safer. As part of tomorrow’s world of interconnected road users, pedestrians could carry an electronic wristband or a ‘smart’ watch able to communicate via Cooperative Systems with the vehicles on the road. The bronze medal went to a student at Munich Technical University: Just like the top winner, Sasan Amini had been thinking about how to make searching for a parking space easier – and arrived at a completely different solution. According to his concept, information about the nearest free parking slot will be transmitted via Car2Infrastructure communication to an approaching vehicle, which then drives to this spot in autonomous-driving mode.

In quantitative just as in qualitative terms, the first edition of the Mobility IDEA Contest was a great success. Ben Collar, head of Research & Development for Siemens Road and City Mobility in the US, used the announcement of the contest winners as an opportunity to appeal to all decision makers in the field: “Having all three winners of this first contest of its kind at Siemens come from university level only further proves the importance of developing the great minds of tomorrow to help solve our most pressing challenges.”

The possession of money has many facets: There are those who save to be able to afford something special, while others generously toss around borrowed funds that they are in fact incapable of paying back. And lottery players pray that Lady Luck will look on kindly and make them as rich as Croesus, the ancient ruler of the Lydian empire, the original place where minted currency was invented about 2,600 years ago.

Sadly, money is no guarantee of prosperity. Croesus was sent into exile, his capital overrun by Persian troops – and all his wealth went to the dogs. Likewise, for the magnum opus of the medieval alchemists, most of whom were retained by the nobility for the purpose of trans-forming base metals into gold, there was rarely a happy ending: Over years of research the sponsors lost pots of money, and in the end the hapless gold seekers themselves lost their heads.

For our filthy rich contemporaries, their wealth is often a heavy burden, even though these days those riches tend to consist mostly of virtual Dollars held in the Cayman Islands – or else of Bitcoin. Some economists are even working to completely abolish cash, and in Denmark from 2017 onwards, no more new banknotes or coins will be printed or minted at all.

But would solid gold coins really be the better solution? Remember the literary case of the enduring fears of a certain Scrooge McDuck from Duckburg – occupation: zillionaire – that he would at any moment be separated from his fantasy fortune by a squad of safecrackers. Truth to tell: Even the obligatory bath in an overflowing money bin gives no relief to this permanent stress.

Preferably truly hard currency then. Something like the Rai stone cur-rency from the Pacific island of Yap. Some of these millstones stand over four meters in height and weigh in at up to five tonnes; resting beside the homes of the island’s inhabitants they have been used for at least 1,500 years to signal the prosperity of their owners and, to this day, are valid as legal tender. The term “loaded” might have been coined for this very situation.

Perhaps for other countries and cultures this could be an interesting option, although a little unfamiliar in the beginning: Rocking up to the gas station without the right money to pay for your fuel, you might find yourself going home with a pound of gravel in change.

The burden of richesMoney rules the world, of that there is no doubt. But of course those riches can also be hard to bear.

In the side-view mirror

ITS magazine 2/2015 | Profile

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Personal background

• 1997: Graduation as Mining Engineer – Bergakademie Frei-berg, Germany (mining- and metallurgy-oriented university)

• 2002: PhD thesis “Highly reliable computational algorithms for navigation in civil aviation“ – Imperial College London, Stanford University

• 2003: EMBA on “London conges-tion charge“ – London School of Economics

• 2004-2009: Swiss Federal Rail-ways, program manager of the programs “New pricing system in public transport” and “Sales Plat-form Railteam Broker for Euro-pean high-speed rail services”

• 2010-2013: Associate Partner of the Surface Transportation Prac-tice at the strategic consultancy firm Oliver Wyman, Boston

• Since 2014: Senior consultant – Siemens Mobility Consulting

to funding public transport projects. They prefer to shift the entrepreneur-ial risk to private or privatized operat-ing companies – though without granting them the entrepreneurial scope needed for the truly profitable operation of such systems.

How could the operators benefit from this scope if they had it? In my eyes, a good approach would be so-called mobility pricing schemes. Why does the metro fare in a major city have to be the same all through the day, morning, afternoon, evening and night? Who says that people who can plan their schedules flexibly have to travel during rushhour, of all times? This state of affairs simply means that the transport systems are hopelessly overcrowded for a few hours out of 24, while they remain mostly empty for the rest of the day. And that’s one of the most important profitability strains for public trans-port operators. Transport operators who manage to level out these daily, but also seasonal, hills and valleys have much better options when it comes to planning infrastructure and vehicles capacities, timetables and human-resource allocation. On the bottom line, it would be possible to transport the same or even much higher numbers of passengers at much lower operating costs.

Interview Dr. Knut Sauer, globally renowned consultant from Siemens Mobility Consulting, on the emerging discussion about mobility pricing, the difficult tightrope act to balance public and private interests, and the urgent need for a fundamental policy decision regarding mobility funding.

Dr. Sauer, chronically congested mobility systems come at a high cost to the industrialized countries. Until 2030, experts expect economic losses of close to 800 billion US dollars per year for major cities alone. Does this essentially correspond to your projections? I think there is no absolute truth in this regard. For me personally, such projec-tions are valid because they tell us more about the actual value of mobility. But seen from the pragmatic viewpoint, such calculations will not solve any traffic problem: It is hardly possible to predict whose economic balance would balloon with this hitherto untapped potential if it were suddenly possible to exploit it. The expected economic benefits for society as a whole would certainly not yet enable any public transport opera-tors, for instance, to buy new rolling stock or hire additional staff. And it is highly unlikely that a bank would be willing to finance a major mobility project simply on this basis.

And what about governments? Isn’t it in their very best interest to strengthen the economy of their respective country?Basically yes, but in many regions of the world there seems to be a ten-dency to move in the opposite direc-tion. Governments keep cutting sub-sidy levels, specifically when it comes

“ A clear case of either-or”

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ing that public transport fee schemes need to be fine-tuned in relation to the costs for private transport on the same routes and to the price level that the passengers will accept. Here too, we are still far from a scenario where users actually finance the full costs for the infrastructure they use. The taxes imposed on motor vehicle use do definitely not cover the costs. This means that in the future, the use of private cars would become more expensive too?Quite right. At least if we want mobility to be user-financed – and as things stand, this will be the only way to go. The important point is to define fair pricing principles also for private transportation, for instance based on travel time and kilometers traveled. One approach would be a suitable tolling scheme, on the con-dition that the revenues are used to finance future infrastructure projects.

Do you think that the mobility pricing concept will actually be politically viable in the short term?You do have a point there, this topic is highly controversial almost every-where. But in some regions, there are already lively discussions going on, for instance in Switzerland, where infrastructure capacity is maxed out to an even greater extent than in

many other countries. Just look at the main corridor between Zurich and Bern: This route is served by trains at 30-minute intervals and an excellent multi-lane motorway – and still the different transport facilities are burst-ing at the seams at peak times. When you think the idea of mobility pricing through, you realize that in fact it will not be a restriction of mobility, but an intelligent way of steering it. And in the end, everyone will profit from the positive effects.

Still, such a paradigm shift will take a lot of courage on the side of the decision makers...True. But at the same time we need to think about what would be the alternatives. Don’t get me wrong, I would be perfectly okay with the decision to treat mobility as a com-mon good that must be accessible to everybody at every time on equal terms. But then we would also have to finance the system like a common good, i.e. exclusively from public coffers. If, on the contrary, we wish to organize mobility as a market-driven system, the fundamental eco-nomic principles must apply. I am firmly convinced that this is a clear case of either-or. Dr. Sauer, thank you very much for talking to us.

What would have to be the spread between fares at different times of day in order to sufficiently even out passenger numbers?A good reference point is provided by the airlines, who have decades of experience in optimizing their strate-gies for maximally uniform capacity utilization. Tickets for the most sought- after flights are often five to six times more expensive than those for off-peak flights. An analogous tariff scheme in mass transit based on the mobility pricing principle would mean that during peak times, today’s 3-euro ticket would cost between 15 and 18 euros. And there are already exam-ples today that even in the realm of public transport, passengers are quite willing to pay high surcharges for some mobility services that are in particularly high demand. The fee for the 15-minute Heathrow Express transit from the airport to the center of London, for instance, is a multiple of the ticket price for the correspond-ing trip on the Tube.

What impact would such a scheme have on intermodality, a topic that has been at the top of the agenda for years now? Of course, if you want to avoid nega-tive changes in modal split, other parameters need to be adjusted too, not just this one. It goes without say-

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IMPRINTITS magazine · The Magazine for Siemens Intelligent Traffic SystemsPublisher: Siemens AG · Mobility Division · Mobility ManagementOtto-Hahn-Ring 6 · D-81739 MunichEditors: Stephan Allgöwer (responsible editor), Karin Kaindl, Roland Michali: Siemens AG, Communications and Governmental AffairsCoordination: Roland Michali: Siemens AG, Communications and Governmental AffairsCopywriting: Peter Rosenberger, Philip Wessa: www.bfw-tailormade.de · Eberhard Buhl(“In the side-view mirror”)Photographs: iStockphoto pages 1, 2, 6/7, 9, 16 . Achim Grafpages 3, 30, 31 . Corbis pages 10, 12, 18, 19 top . Credo Consulting, Chris Molloy and Matt Loveringpages 11, 12 . CargoBeamer pages 26/27 . Photo-case page 29All other photographs: Siemens AGEnglish translation: Dr. Barbara GutermannSprachendienste GmbH, BiberachConcept & Layout: Agentur Feedback, Munich · www.agentur-feedback.dePrinting: G. Peschke Druckerei, MunichCopyright: © Siemens AG 2015All rights reserved. No part of this publication may be reproduced or used without express prior permission. Subject to technical modifications. Printed in Germany.The next issue of the ITS magazine will be published in September 2015www.siemens.com/trafficISSN 2190-0302Order No. A19100-V355-B120-X-7600Dispo No. 22300 · K-No. 689313702 IF 07152.0