Digital Transformation Project: RET & Autonomous Vehicles
Introduction to the RET
RET (“Rotterdamse Elektrische Tram”) is the main public transportation operator of the Rotterdam city region. It is a public limited company and the municipality of Rotterdam is the sole shareholder. The history dates back to 1878 when it started with horse-drawn trams. Nowadays, RET transports about 186 million people in Rotterdam and the surrounding municipalities on an annual basis. Furthermore, the company has approximately 2,600 employees and 10 business locations in the Rotterdam – The Hague conurbation (RET, 2014).
The digital transformation
RET has achieved a strong position as the transportation provider of the Rotterdam conglomeration. Incentivized by its value proposition and a robust reputation among its three different customer segments, it tends to have a pioneering role in the Dutch public transportation market and therefore, despite a likely shift in workforce, should endeavor to embrace innovation through articulating an IT strategy together with its business strategy.
Public transportation is expected to become key for urban travel and commuting in cities of tomorrow and RET should thus attempt to offer its customers increased capacity, flexibility (i.e. on demand services, Owczarzak & Żak, 2015) and safety via automated trams and metros, as well as autonomous cars and buses. In this context, the technology of automated trams and metros is partially in place but would need a few more years, including some regulatory changes, before being able to be fully utilized. In addition, autonomous buses should be introduced to complete the entire market coverage. Last but not least, autonomous cars offering door-to-door services could constitute RET’s strategic response to trends like car-sharing and expand its market opportunities through the use of big data. Further, they could retaliate to the introduction of substitute providers like Uber.
It remains clear that this technology’s success primarily depends on customer’s acceptance and trust. Although one might not be sure whether people will welcome this new technology, there is no question that the latter will come, only a debate about when it will be ready. Issues like software security threats, vehicle expensiveness or legal and liability cul-de-sacs could negatively impact customer’s view and thus hinder a straightforward application of the autonomous driving technology. Further, the final technical feasibility of some autonomous vehicles, especially of cars, still has to be proven and hence a final market launch decision cannot be made yet. If, however, the technology would reveal to be watertight, this could have a significant impact on most of today’s routines and automotive stakeholders, but most importantly would constitute a welcomed solution to some of this century’s major problems like population growth, demographic change or accelerated urbanization.
Owczarzak, L., & Żak, J. (2015). Design of Passenger Public Transportation Solutions Based on Autonomous Vehicles and Their Multiple Criteria Comparison with Traditional Forms of Passenger Transportation. Transportation Research Procedia (10) 2015, Pages 472-482 Available at: http://www.sciencedirect.com/science/article/pii/S235214651500188X [Accessed 12 October 2015]
RET.nl (2015a). About RET. Available at: http://corporate.ret.nl/en/about-ret.html [Accessed 5 October 2015]