Amber started over two years ago, when Steven Nelemans grouped up with other students at the University of Technology in Eindhoven to build their very own hyper-efficient car. The vehicle was fully-electric and achieved the same efficiency as gasoline-powered vehicles, exceeding the equivalent of 400 km o n just one litre of fuel. However, unlike many others, the team identified that the biggest problem was not battery efficiency, but congestion. Congestion is an overwhelming problem we face today and it is only getting worse as more people buy and drive cars in cities around the world, affecting parking, traffic and, above all, the number of unused cars. In the Netherlands, more than 80% of cars are not being used - even in peak hours. Due to this, Nelemans and his team focused on eliminating car ownership through a carsharing service, an innovation that is slowly becoming an attractive alternative to personal vehicles. However, Nelemans tells me, carsharing has not yet established itself as an effective form of transportation for most, with low availability being a key issue in the growth of mobility services. "A lot of people do not necessarily want to own a car, but they want the availability of the car to always be there. This is why we have introduced a guaranteed mobility programme that will allow customers to have mobility-on-demand without having to own a car. This is what people want, as they then have the availability of owning a car without the hassle of high costs that come with vehicle ownership."
If you want to make an efficient mobility service platform, you need to have a different outlook. Traditionally, automakers have not only made profit from selling vehicles, but through services and repairs at dealerships. Nelemans explains that carmakers would go bankrupt if vehicles operated for decades without needing any maintenance as there would be no need for customers to buy another car. "Automakers make sure that these cars drive under 300,000 km and need a lot of maintenance because that's where they can make a lot of extra money through a planned obsolescence model." By doing so, automakers are able to design products with an artificially limited shelf-life, generating long-term sales volume by significantly reducing the vehicle replacement cycle. However, when you turn around the business model like Amber is doing, owning all of the cars itself, you are then responsible for the products and will not make any profit from a planned obsolescence model. This reassures customers that there will be no issues or added costs. "This is the reason that we returned to our background in car building and engineering and produced the Amber 1: the first car that is specifically designed to be shared," Nelemans says. "To make our platform as efficient as possible, we are developing this car to lower the cost and make it easier to maintain our service."
We have seen a huge change within automotive business models, which have followed a buy-to-sell model since the first car was introduced to the world. Now, we are seeing companies adopt new business models that eliminate the linear approach and push for a more agile business infrastructure. Above all, mobility is a service and that is the way that it has to go, removing the need to own your own car. Now it is time for the OEMs to grasp this concept and look at approaching their businesses outlook with a fresh perspective. Nelemans believes that most OEMs will try to go this way, but also believes that not all of them will succeed. “I think that they are so used to a different kind of business model. Their entire DNA is built around selling cars and, if you want to change your business model, you need to change the whole business which is extremely difficult for larger companies."
More agile businesses have the freedom to adapt business models however they want, unlike the OEMs who have invested a lot of money in manufacturing and the supply chains and risk losing a lot of money switching things around. If these automakers try to change this by building a different kind of car with completely different components, it becomes extremely difficult and time consuming. Nelemans believes that it is all about timing for these larger brands, highlighting Kodak as a prime example. Kodak was the first company to develop digital cameras, however the timing wasn't right and led to the end of the brand, something that could happen to automakers as well. "I also think that this will happen in the automotive industry. Some will make it in the end, but many will not be able to succeed in the mobility market."
Fundamentally, you cannot have every automaker trying to produce autonomous and connected cars. There is simply not enough space. Brands which recognise this shift first will be the ones which succeed, whilst others that wait around will go bust. One key step to achieving success in this field is creating partnerships with key specialists so that companies can quickly adapt and learn of the developing mobility sector. "There are a lot of large automakers investing in this area and I think this is definitely the way for them to go because it is the easiest way to adopt innovation and look at what the customers want,” Nelemans adds. “For example, if you can invest in a startup that's going to be doing something in self-driving vehicles or car sharing then it is much easier for these companies to utilise this technology without having to turn their whole business around."
By the middle of 2018, Amber is aiming to incorporate autonomous technology into its vehicles which will significantly benefit the company's operations. The biggest problem with a carsharing service is that the car must be dropped off by a customer in a certain place, which reduces efficiency for both drivers and Amber. "We will not use level 5 automation as we do not need to have people in the vehicle when it is in self-driving mode. We will only use it for the distribution of vehicles on our platform, which guarantees mobility on demand for our customers," comments Nelemans. Self driving vehicles can eliminate the logistical issues that have halted the adoption of carsharing, such as cost, by calling back fleets when needed. This is what makes Amber so unique when compared to players in Silicon Valley, not focusing on autonomously transporting people. “This will lower the complexity of the situation our cars are in whilst allowing us to get licensing and approval so early on," Nelemans adds. Larger companies that are pushing for 100% autonomous vehicles on public roads are struggling to get products to market, as strict regulations from governing bodies are making sure that this innovation is not rushed out without taking the appropriate measures. By not having a human in the vehicle, Amber has more leeway to press on with autonomous technology.
However, even with this green light, there are still issues to be faced. Human or no human, these cars will be driving through densely populated urban environments with junctions, low quality roads and poor weather conditions. "One of the challenges that we are looking to overcome is the technology itself, working together with a lot of partners which have already developed part of it. For us, because we have such a low level of interaction, we can already use the technology that is available today. It is not a development issue, but just the implementation of it, which is a huge challenge," Nelemans stresses. Amber is working with global leaders such as Microsoft and Nvidia which have already developed part of the solution and this allows the company to get the technology in its cars quicker. However, the most interesting approach from the Dutch-based startup is that it is overcoming these issues by simply operating in off-peak hours. "In Eindhoven we have dedicated lanes that can be used. We are focused on getting our cars to drive around in really simple areas and, once we develop, we can increase the complexity of the situation much faster than other companies."
Similar to other European countries such as the UK and France, the Netherlands has been extremely supportive of future mobility and has been working alongside companies such as Amber in order to develop and roll out autonomous technology organically. "Eindhoven wants self driving cars on the road, so we must make sure that we work together with authorities from the beginning of the development and implementation process and know everything is safe. The way to overcome problems with regulations is through collaboration; the one thing we all have in common is that we all want it to be safe." There are already multiple laws passed in the Netherlands that allow autonomous testing which already puts the country, and continent, in a great position for progression. Collaboration is also vital for creating new smart infrastructure that can support the autonomous vehicles within it. Without this, there will be no way of adopting cleaner, more efficient mobility. However, as Nelemans explains, smart infrastructure follows behind the connected cars themselves: "The necessity for infrastructure increases when the level of autonomy does. So, the more development we see towards level 5 autonomous cars, the more support you will get from the surrounding infrastructure.” However, by driving at night, using bus lanes and operating differently to level 5 autonomous cars, Amber doesn’t need as much support.
Overall, mobility services like Amber will reshape the transportation sector and improve people’s lives. Once we see this shift over to new mobility platforms, that are cheaper, and more efficient than car ownership, driving your own car will not make sense anymore. With the idea of guaranteed mobility, Amber is surely one of the front runners of future transportation, continuing to grow and expand in the mobility market and working towards a more simple approach to operating autonomous vehicles.