Eyeing Uber VW expands ride-sharing service to Hamburg

Moia will launch its ride-sharing minibus service in Hamburg, vying for customers who’d otherwise opt for Uber, a taxi or regular bus. If successful, the VW subsidiary could go global.
Quelle: dpa
More Moia: CEO Ole Harms (left) and COO Robert Henrich share a ride into the future.

(Source: dpa)

Volkswagen will introduce its new ride-hailing service in Hamburg this April, making it the second city where customers can share a VW minibus taxi.

Called Moia, it will start in Hamburg with 100 purpose-built, futuristic-looking electric minibuses seating up to six people plus luggage. The fleet is to be expanded to 500 within a year, Moia CEO Ole Harms said.

VW’s ride-sharing service, which customers can order with an app on their phone, officially launched last July in Hanover, close to VW headquarters in Wolfsburg. Together with Hamburg’s transportation authority Hochbahn, Moia will now introduce its product to the port city to test it in a large urban area with more than 1 million citizens.

The world’s largest carmaker, VW wants to make the leap from producing cars to offering mobility services and, hopefully, open up a new revenue stream. The success of US ride-hailing app Uber has served as a wake-up call to cater more to a younger generation that doesn't necessarily wish to own a car.

Mercedes-maker Daimler introduced a ride-sharing service in Berlin last year with its US subsidiary Via and the Berlin transportation authority, BVG. Teaming up with a transportation company is essential to receive the licenses required to transport people. Uber’s basic ride-hailing service got banned in Germany in 2014 because it worked with private drivers. Uber’s professional taxi services only operates in Berlin and Munich.

Moia and Daimler's rival service in Berlin are different from Uber. The two German companies operate a fleet of company-owned vehicles, employ the drivers, and only pick up and drop off passengers at designated locations.

VW and Daimler also face competition from a home-grown startup: CleverShuttle. This four-year-old company, majority-owned by railway operator Deutsche Bahn, uses electric and hydrogen cars that provide more of a limousine experience than Moia. CleverShuttle operates 220 vehicles in seven German cities and offers door-to-door service.

Hamburg as a showcase

Moia has chosen Hamburg as its second location because the city is hosting the Intelligent Transport Systems ITS World Congress in 2021 and is keen to showcase new projects in the run-up. Moia has agreed to price itself above conventional public transport in Hamburg, where a ticket costs €3.30. As passengers have to share journeys, the rides will be cheaper than taxis – around €6 to €7 ($6.90 - $8.07) for a 6-kilometer (3.7-mile) ride, Moia said.

Moia boss Harms has ordered a scientific study of the Hamburg test run before deciding on an expansion strategy. Ideally, it will be launched in cities around the world, but he wants to avoid the mistakes made by Uber and CleverShuttle and will only proceed when he deems the service is as good as it can be. He declined to predict when Moia will turn a profit.

The service could become a lot more lucrative once self-driving buses are used. Rival Mercedes has similar ideas on that score. At the CES consumer electronics show in Las Vegas, it’s currently showing off an autonomous shuttle to drive people and goods around town. Deutsche Bahn’s subsidiary ioki, Berlin’s Transport Authority and VW have been testing similar concept cars.

Christoph Kapalschinski covers consumer goods, textiles and food for Handelsblatt. David Crossland adapted this into English for Handelsblatt Today. To contact the author: [email protected]