One of the Big Three automakers and an industry juggernaut, Ford is a brand known primarily for producing and selling consumer vehicles. But the company has made a recent pivot, expanding into other commercial ventures beyond selling cars. Of significant interest to transit agencies is Ford’s venture in the paratransit space: GoRide, a Non-Emergency Medical Transport (NEMT) service recently launched in Detroit, Michigan. Why is Ford branching out, and what does this new entry into the NEMT space mean for paratransit and transit agencies?
Branching Out: The Future of Mobility
Attitudes towards the personal vehicle are changing. Car ownership is on the decline, especially among younger generations. While car ownership was previously seen as a necessary rite of passage, the rise of Mobility-as-a-Service (MaaS) is changing these conceptions.
With more convenient transit and new mobility options like car sharing and ride hailing, a personal vehicle is no longer a requirement in many cities. Traditional auto retailers are taking note of this trend, and attempting to broaden their commercial offerings beyond car retail. For example, Ford also has a bike-sharing program called GoBike, and General Motors runs a car-sharing service called Maven.
In order to ensure that it responds adequately to changing trends in vehicle ownership and transportation, Ford has even launched a subsidiary called Ford Smart Mobility. The aim of the subsidiary is to “build, grow and invest in new mobility services,” and to ensure that the organization’s different initiatives align.
“Ford Smart Mobility and expanding into mobility services are significant growth opportunities,” said Mark Fields, President and CEO of the Ford Motor Company, at the launch of the subsidiary in 2016. “Our plan is to quickly become part of the growing transportation services market, which already accounts for $5.4 trillion in annual revenue.”
Meeting a Need: A New Paratransit Service
Earlier this year, Ford entered the paratransit space with a multi-year agreement with the Michigan Health Authority, allowing the company to provide patients with on-demand rides to and from medical appointments, rehab centres, hospitals and approved physician partners. Ford uses its own van, the Ford Transit, to provide the service, and makes use of experienced drivers who are trained in passenger assistance and sensitivity.
Ford’s early reports indicate that the service has been highly successful. So far, GoRide has been on schedule 92% of the time with an average wait time of 10 to 30 minutes. The service, which initially focused on facilities across the Beaumont Health network, also expanded at the end of August 2018 to further include the hospitals and institutes of the Detroit Medical Center (DMC). So all signs point to a promising future for GoRide. But with Ford’s historical focus on producing and selling vehicles, why are they now choosing to enter the paratransit space?
Market Disturbance or Anomaly?
From car and bike shares, to autonomous taxi services and beyond, new companies and startups are constantly disrupting and expanding the MaaS market. The paratransit space is experiencing similar, if slower, growth and change. In addition to Ford, companies like Uber and Lyft are also moving into the paratransit space.
It’s important to remember, however, that entering paratransit and on-demand transport when you’re unfamiliar with the industry can be rather daunting—and some companies are finding themselves in hot water because of a failure to meet customers’ demands. Ford has been successful, but that’s because it made the smart decision of starting on a small scale and focusing on a single city. With GoRide, the company is also taking a more traditional approach to providing paratransit service; GoRide relies on phone and webpage booking and does not yet have a mobile app.
It’s never wise to ignore the reality that large and well-funded companies are showing interest in your industry and looking for opportunities. Just because Ford’s GoRide is currently not a major market disruptor does not mean that transit agencies can relax and focus on business as usual. New companies are entering the mobility space on a regular basis, and fleet managers should pay attention. To remain competitive requires new ideas and technologies, such as the recently released ADEPT IQ dispatch system, which will ensure that your agency remains relevant in a changing landscape.
Connect with DDS, and let us help bring your paratransit services up to speed. You can also read more about the changing nature of paratransit in our white paper, The Next Era of Paratransit.