An ecosystem approach to reducing congestion

An ecosystem

approach

to reducing

congestion

2 Strategy&

Contacts

Chicago

Evan Hirsh

PwC’s Strategy&

Principal, PwC US

+1-216-287-3723

evan.hirsh@pwc.com

Andrew Higashi

PwC’s Strategy&

Director, PwC US

+1-808-772-0133

andrew.higashi@pwc.com

Detroit

Ramesh Telang

Partner, U.S. Automotive Leader,

PwC US

+1-313-394-6738

ramesh.telang@pwc.com

Brandon Mason

Director, U.S. Mobility Leader,

PwC US

+1-313-394-6098

brandon.w.mason@pwc.com

This report was produced with the participation of the National Parking

Association (NPA), and its contents have been approved by the NPA and by

Strategy&, PwC’s strategy consulting business.

3Strategy&

About the authors

Evan Hirsh is an advisor to executives in the automotive and industrials

industries for Strategy&, PwC’s strategy consulting practice. Based in

Chicago, he is a principal with PwC US.

Andrew Higashi is a director with PwC US in the automotive and

industrials practice and a thought leader for Strategy&. He works with

executives to develop strategies that drive proﬁtable growth, and has

experience working with OEMs, suppliers, and technology companies

looking to enter the evolving mobility landscape.

Brandon Mason is a director in the automotive practice with PwC US.

In this role, he serves as an active industry participant and spokesperson,

continually monitoring global automotive developments and

technology-driven trends, including the connected car, autonomous

driving, ride- and car-sharing, digital and data management,

infrastructure, and mobility.

Tim Catts is a thought leadership researcher and editor specializing

in mobility and the future of transportation.Based in New York, he

is a manager at PwC US.

4 Strategy&

Executive summary

The challenge of congestion is a perennial issue for cities around

the world, and is rapidly worsening. In recent years, a number of trends

have exacerbated urban congestion. These include economic expansion

and increased urbanization; the rise of both ride-hailing services,

which puts more cars on the roads, and e-commerce, which adds to the

number of delivery vehicles; the deterioration of existing infrastructure;

and the mixed success of some eorts to reduce congestion.

Based on research sponsored by the National Parking Association (NPA)

in the U.S., this study explores the drivers of congestion and potential

solutions in an evolving mobility landscape, including how parking can

be an asset within the transportation ecosystem and implications on

eective policy planning in an eort to create livable cities of the future.

The research encompasses analysis of publicly available information,

as well as observations and interviews with people from diverse

backgrounds: technologists, parking operators, developers, policy

planners, academics, venture capitalists and other investors, the

startup community, and infrastructure investors.

Numerous options for reducing congestion are available to

municipalities, but some are more eective than others. The

most successful tend to take a comprehensive ecosystem approach,

recognizing from the start that all the elements of trac design

aect one another and should be designed and developed in an

integrated way. This means considering both near-term and long-range

measures that aect both transportation supply (e.g., new roads

and rail infrastructure) and demand (e.g., incentives for travel at

non-peak times).

These approaches include fostering innovation in an experimental, agile

fashion so that city planners can learn while developing new solutions;

seeking a wide range of ﬁnancing from public–private partnerships and

other sources; and tailoring the approach to each city’s unique trac

layout. There are seven archetypal city patterns — some with dense,

5Strategy&

non-grid cores (e.g., Singapore and Amsterdam); some with grid-based

urban hubs (e.g., New York, London, and Toronto); and some with

spread-out layouts and multiple hubs (e.g., Los Angeles and Paris).

Each city requires its own mix of measures to reduce congestion, and

can choose from a wide array of options. These range from encouraging

alternative modes of transportation (e.g., more opportunities for

walking and travel by bicycle and motor scooter) to raising the real

costs of inner-city access with measures like congestion pricing and

variable parking fees to improving infrastructure for rail travel, bus

service, or parking. (Motor scooter is the term used in this paper for all

variants of powered scooters, including electric scooters and dockless

scooters.) City planners can make more eective decisions about access

to transportation network companies (TNCs), including ride-hailing and

taxi services; establish new innovative approaches to double parking

and last-mile deliveries; and prepare for new technologies, including

machine learning-based analytics that can redirect trac ﬂows, vehicle-

to-vehicle connectivity that can increase highway utilization, and

futuristic ventures such as drones and Hyperloop.

To take a fully holistic ecosystem approach, city planners need to

consider the interrelationships among all these measures. Some eorts

simply attract more vehicle trac, while others reduce congestion by

giving people multiple attractive alternatives and easy ways to switch

among them. Pioneering “mobility hub” approaches, which coordinate

parking, mass transit, and commuting, are now being implemented in

cities around the world. Urban government and business leaders can

learn from these leading-edge examples, and put new, improved

innovations into practice.

6 Strategy&

Congestion costs

the U.S. between

US$230 billion

and $300 billion

each year, about

four times the

amount spent

on public transit

and double

the spending

on roads and

highways.

After World War II, the United States experienced substantial economic

and population growth — from 151 million people in 1950 to 326

million people in 2018. Suburbs were created, urban sprawl increased,

and a car-oriented culture developed. The number of motor vehicles on

the road increased, from 68 million in 1958 to more than 270 million

in 2018. By the mid-1980s, 85 percent of commuters were driving or

carpooling to work, a trend that has remained consistent for 40 years.

The result has been a steady increase in debilitating trac congestion.

Congestion is the breakdown in trac ﬂow, reduction in speed, and

increase in crowding that occur when a road’s capacity is exceeded.

Capacity is so consistently strained on America’s roads that congestion is

a chronic problem throughout the country. In 2017, the average person

spent 41 hours in congestion, an increase of 8 percent over 2010.

Among major U.S. cities, the situation is even worse. In Los Angeles and

New York, time spent in trac is more than twice the national average.

Congestion costs the U.S. between US$230 billion and $300 billion each

year, about four times the amount spent on public transit and double

the spending on roads and highways. Nearly 75 percent of the cost takes

the form of direct costs, such as excess fuel consumption and harm to

people’s health from air pollution. Lost time may be the direct cost that

Americans feel most acutely. Indirect costs, including higher prices,

account for the remaining 25 percent of economic impact.

This report focuses on the United States, but the same dynamic exists

in most other countries, in both industrialized and developing

economies. For nearly every country with large cities, including

emerging economies, congestion represents a major social and

economic cost. Congested lanes and hard-to-ﬁnd parking create a

disincentive for employees and tourists to enter a city — a phenomenon

known as trip avoidance. Cities rely on employment, tourism, and

corporate investment to fuel livability and economic vibrancy, and

all of these are diminished by trac congestion.

Introduction

7Strategy&

With the U.S. population projected to hit 390 million by 2050, the

implications of continued growth for congestion are urgent. The goal of

this report is to provide analytical insights on the most relevant trends,

innovations, and case studies to inform public and private plans for

reducing congestion.

8 Strategy&

The problem with congestion is expected to worsen during the next few

years, driven by six main factors:

1. Economic expansion

Economists have long understood the strong correlation between an

economy’s performance and the overall vehicle miles traveled (VMT)

in that region. VMT, which is also aected by gas prices, serves

as a reasonable proxy for potential congestion. In the U.S., given

expectations for GDP growth, we expect a 1 percent CAGR for VMTs

through 2030 — a 14 percent gain, or a 500 billion mile increase.

2. Demographic changes and urbanization

The U.S. population continues to grow, and to shift from rural to urban

areas. From 2010 to 2030, the U.S. population is expected to increase

15 percent, from 309 million to 355 million, and the percentage living

in urban areas is expected to rise from 81 percent in 2010 to 89 percent

by 2050 (see Exhibit 1, next page). This will exacerbate an existing trend

— a 160 percent gain in the U.S. urban population since 1980 — that

has signiﬁcantly increased VMT in cities. At the same time, motor

vehicles remain the dominant transportation mode; for example, the

percentage of commuters driving to work, rather than taking public

transportation, has remained largely constant.

3. Transportation disruption: TNC and ride-hailing

Ride-hailing has grown, substituting for mass transit, putting more cars

on the street, and contributing to congestion at the curb. Transportation

network companies (TNCs) such as Uber, Lyft, Gett, and Easy Taxi tend

to oer both ride-hailing and ride-sharing (the dierence is that ride-

sharing involves two or more independent passengers on a trip). TNCs

have experienced explosive growth, from just a handful of trips in 2012

Six major trends fueling

congestion

9Strategy&

to about 2.6 billion trips in 2017. The VMT from these TNCs grew

from 30 million in December 2013 to 500 million in December 2016,

a compound annual growth rate (CAGR) of 150 percent.

Ride-hailing services have become a valuable part of the current

transportation ecosystem. Their cost and convenience beneﬁt many

consumers. Nonetheless, TNCs remain a small part of the overall

transportation picture in the United States. While nearly 10 percent

of all Americans use TNCs in any given month, their rides only account

for 0.5 percent of total trips taken.

The economics of TNCs favor cities, where parking expenses add to the

costs of private car travel. Within cities, shorter trips favor ride-hailing

over private vehicles; but the longer the trip, the more cost-eective a

Exhibit 1

Past and expected U.S. urban and rural population growth, 1980–2050

Source: United Nations,

World Urbanization

Prospects, 2018 revision

100%

Rural

Urban

2000 20402020 2050

230M

20302010

282M253M

190M

(75%)

62M

(25%)

309M

249M

(81%)

355M

54M

(15%)

57M

(17%)

301M

(85%)

326M

(87%)

48M

(13%)

59M

(19%)

347M

(89%)

390M

42M

(11%)

60M

(26%)

331M

274M

(83%)

223M

(79%)

59M

(21%)

1980

1990

169M

(74%)

374M

US urban and rural population growth

10 Strategy&

private car is. In all cases, the cost of public transportation tends to be

less — if public transport is available (see Exhibit 2).

TNCs add to congestion within cities in four ways: (1) They increase

overall travel demand; (2) take rides away from public transit; (3) add

to VMTs with nonproductive “deadhead” miles (miles spent circling

Exhibit 2

Cost of transportation modes by distance in New York and Chicago

Source: NYC.gov;

web.mta.info;

yellowcabchicago.com;

transitchicago.com;

USA Today; Strategy&

analysis

Public transport is always cheaper, but shorter trips favor ride-hail over private vehicle

while longer trips favor private vehicle

New York

Chicago

Clear price advantage

$3.67

$2.94

$1.00

TNC

Public transport

Shared TNC

Private vehicle (used)

$4.98

Private vehicle (new)

TNC

Public transport

Shared TNC

Private vehicle (used)

Private vehicle (new)

$4.83

$1.86

$0.83

$2.33

$3.80

$3.65

$0.60

$3.33

$2.67

$3.18

$3.03

$1.67

$2.09

$0.50

$2.47

$2.32

$2.95

$2.36

$0.29

$1.15

$1.00

$1.82

$0.31

$1.46

$0.97

$0.82

6-mile trip cost/mile 10-mile trip cost/mile 40-mile trip cost/mile

Notes:

1. Public transit assumes cost of single-ride ticket ($3 and $2.50) and zone 4 fares for NYC

(18–22 mile distance).

2. Private vehicle ownership is based on AAA estimates and an average of 15,000 miles,

assumed to be the same for NYC and Chicago.

3. NYC parking of $541 per month (20 days).

11Strategy&

It once seemed

likely that on-

demand delivery

would prompt

consumers to

reduce trips to

malls and retail

stores. But the

expected drop

in vehicle miles

travelled never

materialized.

without a passenger account for 20–50 percent of the miles they travel);

and (4) contribute to trac violations and obstructions.

By embracing forward-looking technologies, such as autonomous

vehicles (AVs), pooled vehicles, e-bikes, motor scooters, and robo-taxis,

TNCs might mitigate some of these concerns or even relieve congestion.

In the meantime, congestion from TNCs will continue to increase unless

steps are taken to reduce their impact.

4. E-commerce and on-demand delivery

Internet-based purchasing is on a rapid growth trajectory, rising in the

U.S. from 0.3 percent of retail spending in 1998 to 8.7 percent in 2014.

Estimates suggest that this share could rise by as much as 1.2 percent a

year through 2030.

Oers of ever-faster shipping have given rise to numerous on-demand

delivery services enabled by TNCs and e-commerce platforms. The 2014

launch of Amazon’s Prime Now service provides shoppers near-instant

gratiﬁcation with one-hour delivery in select markets. With consumer

expectations reset, other retailers need comparable oerings to remain

competitive. It isn’t enough to provide delivery service; they must do so

at a reasonable cost. They are scaling up e-commerce and delivery

platforms to drive down shipping costs, further accelerating adoption.

It once seemed likely that on-demand delivery would prompt consumers

to reduce trips to malls and retail stores. But the expected drop in VMT

never materialized due to three operational considerations: First, both

free shipping and on-demand delivery have increased single-package

deliveries and smaller vehicle loads, inﬂating the number of delivery

trips. Second, failed ﬁrst deliveries are estimated to range between 10

percent and 30 percent, driving repeat visits. Third, at least 30 percent

of e-commerce orders are returned, compared with about 9 percent of

traditional sales, increasing the number of trips by delivery vans to pick

up the item being returned and to redeliver replacements.

Delivery companies also contribute to congestion at the curb through

double parking and illegal turns. Moreover, some city policies do not

discourage this. For example, New York’s controversial stipulated ﬁne

program, launched in 2004, allows delivery companies to reduce or

eliminate ﬁnes for certain citations by waiving their right to contest

them in court.

12 Strategy&

High-occupancy

vehicle (HOV)

and bus-only

lanes are

supposed to

justify their

capital-project

costs by

discouraging the

use of private

vehicles for

commuting, but

they often don’t.

5. Underinvestment in infrastructure

To limit congestion, good transportation infrastructure is critical.

Roads, bridges, and tunnels must be well maintained and expanded

at a pace that is in sync with overall mobility demandgrowth.

Unfortunately, the movement back into cities has overtaxed

transportation infrastructure. This has been particularly problematic

for the U.S., where roads, bridges, and tunnels already suer from lack

of upgrades and upkeep. The American Society of Civil Engineers’ 2017

infrastructure report card awarded U.S. systems an overall grade of D+.

A primary reason for this is the backlog of unmet capital investment for

highways and bridges: about $836 billion, according to a 2015 U.S.

Department of Transportation (DOT) report. The federal gasoline tax,

which funds a great deal of transportation infrastructure expenditures,

has not been raised since 1993. In light of a 2.2 percent annualized rate

of inﬂation from 1993 to 2017, this suggests that funds essential for

infrastructure have fallen short of where they used to be by as much

as 73 percent.

According to the Federal Transit Administration, more than 40 percent

of buses and 25 percent of rail transit assets are in marginal or poor

condition. Nearly 25 percent of bridges are structurally deﬁcient or

functionally obsolete, and about 33 percent of roads are in poor or

mediocre condition. Budgetary restrictions and short-term planning

exacerbate budgetary problems. Inecient use of allocated funds often

forces cities to “patch and maintain,” leading to wasteful spending and

ineciencies.

Maintaining public transit is a particular challenge for U.S. cities.

Annual spending is about $17.7 billion; U.S. Bureau of Transportation

Statistics (BTS) data shows that the need is two-and-a-half times

greater. Additionally, the BTS estimates that the country has a backlog

of about $90 billion in deferred public transit maintenance and

replacement projects.

6. Mixed eectiveness of policies and programs

Cities have embraced a variety of mobility solutions, with mixed

eectiveness. For example, high-occupancy vehicle (HOV) and bus-only

lanes are supposed to justify their capital-project costs by discouraging

the use of private vehicles for commuting, but they often don’t. Because

of challenges with enforcement and other operational issues, these

solutions tend to lead to more, not less, congestion.

When they ﬁrst appear, the special lanes attract drivers; in fact, a 2016

study conducted in California found that unauthorized drivers using

13Strategy&

Some studies

have found that

up to 30 percent

of vehicles in a

particular area

were looking for

a parking space

to open up.

HOV lanes accounted for about 24 percent of the total drivers during

peak hours, and 19 percent in o-peak times. Their availability provides

an incentive for a portion of public transit riders to drive cars instead.

The end result is that congestion in both special and general-purpose

lanes increases, a lose-lose situation for commuters.

Bus-only lanes can lead to increased congestion for three main reasons:

First, a lack of enforcement has led to congested bus lanes. Cameras

installed to monitor unauthorized use of New York’s bus-only lanes

detected 133,000 violations in 2017; that same year, the city’s police

wrote a mere 2,020 summonses. Along with trac signals and

passenger boarding, other trac in the bus lane reduces the average

speed of public buses to nearly 40 percent of private vehicles running

on the same street. Second, there are many dedicated lanes in highly

congested streets, reducing overall capacity. Third, an increasing

number of commuters opt for private vehicles, ride-hailing services,

or other options due to relative cost and convenience. According to the

U.S. DOT, bus ridership has declined at a CAGR of about 1 percent from

2007 to 2016.

City parking policies also contribute to congestion. Regulations,

sometimes dating back to the 1930s, specify that buildings include

parking spaces, which often produces an overabundance of parking.

In eect, this bundles parking subsidies into the prices of real estate

and other goods and services, thus favoring driving over other

transport modes.

Subsidized on-street parking also reinforces the behavior of circling.

Some studies have found that up to 30 percent of vehicles in a particular

area were looking for a parking space to open up. That estimate may

be too high, but this behavior remains a problem. Not charging, or

charging very little, for on-street parking increases demand and

contributes to congestion.

14 Strategy&

Some observers believe that the growing number of shared, electric,

and autonomous vehicles (AVs) could help eliminate congestion and

reduce emissions. After all, these new forms of transport will be

radically disruptive. They will change automotive ownership models,

urban layouts, and the look and feel of passenger vehicles. They may

use the roads in a far more ecient way, through connected-car

technologies that synchronize multiple vehicles on the same road.

However, if consumers are unwilling to pool rides (and the data

suggests this is the case), the future could be bleak. In fact, congestion

could worsen as AVs increase VMT, interact with human drivers, and

induce demand.

Part of the problem involves the slow rate of adoption. Fully autonomous

vehicles will likely not be common in most cities until at least after

2030; they will require considerable design changes, repurposing of

parking facilities and locations, and changes in laws. Extensive testing

and validation of necessary advances in sensor and computing

technology for commercialization will be required. After technological

challenges are overcome, the high cost of AV adoption will limit buyers

and ﬂeets. It will also take a while to replace the large installed base

of millions of legacy vehicles, which have an average age of more than

12 years. Furthermore, legal and ethical questions about liability for

accidents, injuries, and deaths are still unresolved. All of these issues

have to be dealt with before AVs can become mainstream.

In the meantime, roads will increasingly carry partially autonomous

vehicles, where a human driver handles some of the vehicle

management. This conversion to a new way of life could add to existing

congestion problems, especially in the short term. Convenient and

aordable robo-taxis may lessen the appeal of public transportation,

prompting more individual car trips and crowding the roads. AVs and

non-AV drivers may not mix well; for example, AVs may stop suddenly

if cut o by cars with human drivers, slowing network speeds.

Autonomous vehicles:

Slow adoption, uncertain impact

15Strategy&

If ride-sharing

proves more

palatable to

more people, it

would change

the economics

of transport

drastically and

help reduce

congestion.

To mitigate the future negative eects, there are several measures

that could be considered now. These include investments in related

infrastructure (including charging and docking stations), development

of public transit that interacts eectively with AVs, and information

technology (IT) advances. Another key measure is the promotion of

ride-sharing. If ride-sharing proves more palatable to more people, it

would change the economics of transport drastically and help reduce

congestion. Taxes, fees, and regulations will also aect the comparative

cost and convenience of AVs, contributing to their impact on congestion.

As we explore how autonomous vehicles could aect the congestion

and quality of life in cities, questions to consider include: How could

AVs complement current public transportation networks? How should

streetscapes evolve (if at all) to accommodate them? Are dedicated

lanes for AVs optimal? Could on-street parking evolve to accommodate

bus, bicycle, or AV lanes? What about expanding package deliveries and

making them easier to live with? Answers to questions like these can

help drive long-range planning and potentially spark some shorter-term

investments.

16 Strategy&

If you are an urban policymaker, then you are inevitably engaged in

managing trac congestion. Increasingly, your city’s competitive

advantages depend on ﬁnding a comprehensive, holistic solution to

this problem. Look more broadly toward the overall quality of the

urban ecosystem. A livable city is one with convenient, clean, and

cost-eective transportation even as congestion and growth increase.

A seemingly narrow lever — for example, parking policy — can be

deployed on behalf of a full mobility hub: a system of multiple forms

of transportation that eciently and eectively move people where

they need to go.

The number of levers that policymakers have at their disposal increases

the challenges of planning. So does the need for rapid innovation and

change, which may be counterintuitive for existing organizational

cultures and may strain a city’s limited human and budgetary resources.

Policymakers must also manage new modes of transport (i.e., motor

scooters and e-bikes), ride-hailing, and package-delivery growth.

Given these complexities, we propose ﬁve guiding principles for

developing congestion solutions:

1. Consider near- and long-term supply and demand levers.

A combination of policies is required to drive sustainable change

to reduce trac density. Near-term solutions, such as altering

regulations, are often quicker and cheaper to implement. But

infrastructure investments like bus rapid transit require signiﬁcant

investment over a long period of time. Similarly, your solutions must

address both demand, or the needs that people have for

transportation, and supply, or the facilities and infrastructure

available to oer. (See Appendix, page 32, for speciﬁc examples.)

2. Take an ecosystem view to drive city livability. When planning is

conducted for all aspects of transportation at once, you can integrate

multiple forms of leverage — public transit, private vehicles, and

parking — and reduce the tradeos among them. This ecosystem

view should include an interplay of multi-modal transport options

Guiding principles for change

in your city

17Strategy&

Ecosystem-

style solutions

include the

redesign of city

“inner rings”

as a connection

point between

urban and

suburban travel;

streetscapes

that integrate

bus, rail, auto,

and pedestrian

activity; and

parking systems

that mitigate

congestion at the

curb.

and dierent modes of travel designed to work together: Buses

and trains should be accessible from most locations; protected lanes

for bicycles and motor scooters should be encouraged for shorter

commutes; pedestrian walkways and bridges should be encouraged

as well; and switching from one mode to another should be easy

and convenient.

At the ride-hailing level, consumers will become accustomed to

sharing rides. Over time, autonomous trucks, shuttles, buses, and

shared robo-taxis will begin operating, generally on roadways

designed for them, providing convenient, safe, and cost-eective

travel on demand.

Ecosystem-style solutions include the redesign of city “inner rings” as

a connection point between urban and suburban travel; mobility hubs,

where a variety of transit modes come together with smart parking

approaches; streetscapes that integrate bus, rail, auto, and pedestrian

activity; and parking systems that mitigate congestion at the curb,

with short-term drop-o points and ﬂexible ride-hailing stands.

Solutions like these require regulatory and planning changes. Strong

parking and auto travel policies (such as congestion pricing and TNC

drop-o and pickup lanes) can help mitigate competition for space

along the curb. Street and roadway designs must incorporate new

modes of transport (for example, e-bikes, motor scooters, and robo-

taxis) and constrain congestion at curbside from ride-hailing and

package deliveries — all under strict budgetary limitations.

3. Foster innovation through collaboration, pilots, and agile

policymaking. Innovation in the transportation space is evolving

at a rapid pace. The eects of new technologies and new transit are

unproven and often unknown. When you experiment with new

approaches through pilot projects, it allows you to learn from these

trial experiments without having to jump into a full commitment

headﬁrst. Once you see the value of an approach, then scale it

through the broader municipality.

Encourage collaboration with various stakeholders in your

community. Hospitals, universities, corporate campuses, and event

venues are microcosms of transportation systems that might explore

multi-modal transportation options.

When setting up experiments or collaborative eorts, clearly outline

your objectives and the potential value you hope to create. This

helps to focus the scope and better understand when pilots are

beneﬁting the city. Break down the scope of your eort into clearly

deﬁned phases with timelines. Since these are pilots, part of your

18 Strategy&

goal will be learning, and some aspects will not be clear at the start.

Revisit your scope and objectives as necessary. At the same time,

identify your criteria for success and key milestones as speciﬁcally as

you can up front. This keeps your pilots focused and aligns you with

others in the community. As you proceed, continuously collect data

to monitor your progress and better recognize the potential value

that these new programs can create. Use this to gather evidence to

demonstrate your ongoing track record.

4. Develop an innovative ﬁnancing plan. Many options for ﬁghting

congestion are expensive, especially those that involve construction

of new roads or bridges or expansion of public transit networks. If

federal and state government support is elusive, think regionally. If

suburban commuters account for a large share of demand, seek

suburban sources of funding. Technology companies and investors

sometimes fund cutting-edge infrastructure projects to boost their

brand. For example, the Boring Company (founded by Elon Musk)

is expected to cover costs of a proposed Hyperloop tunnel between

downtown Chicago and O’Hare International Airport.

Use referendums to seek funding for broad-based improvements.

In 2016, Los Angeles County voters passed a ballot initiative,

“Measure M,” that raised the sales tax by half a cent until 2039 and

by a full cent thereafter, bringing in an added $121 billion in

revenue through 2057 to fund transit improvements. In the San

Francisco Bay area, voters in nine counties approved a measure in

June 2018 to raise bridge tolls by $3 over a period of seven years.

Some 62 percent of the $4.45 billion of additional revenue raised

over a 25-year period will go to transit projects.

Public–private partnerships (P3s) can also help you attract multiple

participants and reduce the cost of new programs. P3s can help cities

undertake sustainable transit projects less expensively than if they

relied completely on public-sector resources. A recent example is

Toronto’s Finch West light rail line, which will be built by a private

consortium that won the contract in May 2018. When completed,

the line will be operated by the Toronto Transit Commission.

5. Design eorts to match your city archetype. Cities can learn

the most from peers with similar history, built environment, and

transportation infrastructure usage patterns. Your city will tend to

ﬁt one of seven overarching models: Multi-Modal Core, Walking

Core, Urban Hub Community, Mixed Hub Community, Suburban

Hub Community, Driving Metropolis, or EcientMetropolis

(see Which archetype ﬁts your city?, next page).

19Strategy&

Every city’s transportation needs are unique, shaped by its layout and

past infrastructure investments. Most cities can be grouped into one

of seven archetypes, falling into three broad categories (see Exhibit 3,

next page). These archetypes explain the ﬂow of people and goods

between the urban centers of activity where people work and

congregate (downtowns) and the outlying areas where many people

live (suburbs). Each of the seven models represents a dierent pattern

of downtown-to-suburb trac ﬂow; each model has its own congestion

challenges and future parking design implications that reﬂect its

inherent constraints and opportunities. Understanding your city’s

model can help you identify the solutions that will work best.

To decide which archetype ﬁts your city, look at four key characteristics.

The ﬁrst is the city’s layout and infrastructure patterns. For example,

how are roads set up between the city and its suburbs? Do its streets

form a grid or a circular layout? Are its origins medieval or modern?

The second comprises the travel and commute patterns that take place

every day, based on the habits of inhabitants and visitors, which in turn

are based on where they live, work, and travel for leisure. The third

characteristic is maturity of public transit: the overall robustness of

train and bus infrastructure, including ease of access, general

attractiveness, reliability, convenience, safety, cleanliness, and comfort.

The fourth is the relative cost of driving. After considering the cost of

tolls, parking, and trac violations, is it more expensive to drive rather

than to take public transit?

Non-grid cities with a compact core

Two of the city archetypes share a compact core, non-grid layout form.

Often founded in medieval times, these cities have circular, non-grid

layouts and narrow streets, designed for travel by horse and on foot.

There are no “compact core” cities in the United States, although some

multi-modal cities like Boston and New York have urban centers with

non-grid sections.

Which archetype ﬁts your city?

20 Strategy&

In the Multi-Modal Core archetype, public transit (primarily rail) is

relatively mature, robust, and attractive. High population density,

narrow streets, and limited parking increase driving expense. Parking is

time-consuming, and driving is inconvenient and costly. Congestion

challenges are grounded in the historic layout of the city, which is not

conducive to driving. The solutions would include the maintenance of a

robust subway or train infrastructure system as travel demand grows

and the encouragement of other mobility options, such as bicycles,

Exhibit 3

The seven archetypes of 21st-century cities

A. Compact core

and non-grid layout

A high-population density core

where bulk of mobility takes place;

medieval origins; circular city layout;

narrow streets conducive to walking

B. Urban and suburban

community

Rings of suburban establishments

outside dense urban core with

mobility taking place at all levels;

primarily a grid layout

C. Sprawling metropolis

Relatively uniform population

density across entire grid layout

area with small hubs of increased

activity; mobility takes place

between high-activity areas

Mixed hub

community

Suburban hub

community

Urban hub

community

Walking

core

Multi-modal

core

Efﬁcient

metropolis

Driving

metropolis

Chicago DetroitNew YorkFlorenceMunich TokyoLos Angeles

Applicable to U.S. cities

City layout and commuting patterns

Example cities

Medium LowHighLowHigh HighLow

Level of public transit maturity

Medium LowHighHighHigh HighLow

Relative cost of driving

Source: Strategy& analysis

21Strategy&

While Multi-

Modal Core

cities developed

a robust public

transit system,

Walking Core

cities have not.

For residents

of these cities,

travel on foot,

bicycle, or

waterway is the

preferred way to

get around.

motor scooters, minibuses, or shuttles. As an example of a core

archetype city, we looked at Singapore.

Singapore is a multi-modal core city, with a population of 5.6

million and an average annual time spent in congestion of 10 hours

— the smallest congestion time, by far, for all cities proﬁled in this

report. A number of measures contribute to this low number.

Singapore was a pioneer of congestion pricing, which started in

1998, and which is fully automatic; prices vary by route, time of day,

and travel direction. The initial investment for this was $110

million; operating costs are $18.5 million per year, with annual

revenues from fees at $100 million. The city layout is also designed

to reduce congestion, with widened sidewalks where bicycles can

travel and numerous pedestrian bridges. Single-car ownership is

limited to those who hold certiﬁcates of entitlement, which are no

longer issued, forcing new drivers to bid on existing certiﬁcates

starting in February 2018. The city also invests heavily in

transportation infrastructure, and expects to double the reach

of its train network by 2030.

The Walking Core cities are even more inconvenient and costly for

automobiles. They have an ancient heritage, with a circular center that

often features centuries-old manmade barriers like fortiﬁcations or

canals and narrow, winding streets seemingly better suited for a horse-

drawn cart than a modern automobile. Driving is dicult and

expensive, and ﬁnding parking is time-consuming. While Multi-Modal

Core cities developed a robust public transit system, Walking Core cities

have not. For residents of these cities, travel on foot, bicycle, or

waterway is the preferred way to get around. Examples include

Amsterdam, Florence, and Venice. Given its unfriendliness to motor

vehicles and relative lack of good public transportation, the congestion

focus here is to regulate the number of motor vehicles, and encourage

options such as walking and biking that align with the layout of the city.

In addition to options like motorcycles, motor scooters, mini-buses, and

shuttles, some Walking Core cities have developed distinctive forms of

transit, such as the canal boats in Amsterdam and Venice.

Urban grids with suburban rings

Three city archetypes ﬁt a broader pattern we call Urban and Suburban

Communities. They have small, densely populated urban cores

surrounded by rings of less dense suburbs. People tend to commute

between the suburban rings and the dense core. The urban core grid is

formed by rectangular city blocks, with straight streets at right angles.

Though ancient grid cities have been found dating back to 2600 BC,

most were laid out in the 17th century or later. The ﬁrst grid city in the

22 Strategy&

United States was Philadelphia. The three variations are urban, mixed,

and suburban.

Urban Hub Communities have a dense urban center with suburbs

surrounding the core. Most people commute to the center for work or

leisure. Public transit is relatively mature and robust. The cost of

parking is high, since many people drive their own vehicles. The key

congestion challenge right now is the high density and volume of for-

hire vehicles (FHVs), which include taxis and transportation network

companies (TNCs). The best solution is streamlining TNC environments.

In practice, this will mean clearing up the curb by reducing on-street

parking, designing designated drop-o and pickup areas, regulating

TNC driving violations, and incentivizing o-hour delivery programs.

This means that Urban Hub Communities may reduce overall TNC

demand and supply. From a demand perspective, they may focus on

enhancing other enablers of mobility such as bike-sharing, car-sharing

(Zipcar and Enterprise), new bus routes, special bus lanes, and

expanded train systems. From a supply perspective, they may restrict

the number of TNC licenses and how many TNC vehicles are permitted

in certain areas during peak times. They may also consider a congestion

tax. London and New York are urban hub communities with well-known

congestion problems.

New York’s population is 8.6 million, and annual time spent

in congestion per person is 91 hours, up 54 percent since 2010.

(According to the 2017 global trac scorecard published by the

transportation analytics ﬁrm INRIX, New York is tied with Moscow

in second place for this unfortunate measure; only Los Angeles ranks

higher.) Congestion costs New York about $33.7 billion per year, and is

worsening because of new corporate arrivals (such as Amazon.com),

the growth of travel by taxi and TNC (which logged 19 percent of

total miles driven in 2016, an increase of nearly 40 percent since

2013), and the rise of e-commerce. New York has initiated a number

of approaches: a one-year freeze on ride-sharing registrations, a

surcharge on cab and TNC rides, increases in its Citi Bike (bike-

sharing) program and Zipcar parking, and increases in parking

meter rates. Other potential solutions will be needed, including the

use of advanced vehicle connectivity technology and further

investment in mass transit.

Mixed Hub Communities have high-activity areas in both urban cores

and suburban rings, reﬂected in their travel and commuting patterns.

To accommodate the signiﬁcant demand for transportation from the

outer rings to the center, Mixed Hub Communities generally have some

level of public transit. However, these systems are not as robust as is

typical for an Urban Hub Community. The cost of parking is moderate,

stimulating driving. The key congestion challenge that these cities face

23Strategy&

is that their transportation networks have failed to keep pace with

mobility demand growth as their populations and economies expand.

People have plenty of options to move around in the city, but all have

capacity constraints. As a result, Mixed Hub Communities have to

think about enhancing their entire mobility ecosystem. Among the

mixed-hub cities we studied are Chicago, San Francisco, Toronto,

and Washington, D.C.

Toronto, with 2.7 million people, is Canada’s largest and most

congested city. Its time spent in congestion is 47 hours, up 22

percent since 2013. Though the population continues to rise,

alternatives to driving remain relatively unpopular. Toronto has

developed a reputation as an unsafe city for pedestrians and cyclists,

and reliability issues have dogged its transit system. Toronto is

investing in improving its train and bus systems and bolstering its

bicycling infrastructure. In 2016, the Toronto City Council voted in

favor of implementing tolls on the city’s Gardiner Expressway and

Don Valley Parkway. A hypothetical fare of $2 per vehicle was

estimated to raise about $200 million to fund transit projects. The

provincial government rejected the proposal, instead increasing the

gasoline tax revenue that is transferred to municipalities.

Suburban Hub Communities have an urban core, but most people live

and work outside of the core in the sprawling suburbs. Public transit is

immature. People rely on their own vehicles to get around, and the cost

of driving is relatively low. Parking is limited in the urban core, the

inﬂow of vehicles is limited, and tepid demand keeps prices down.

Parking needs are relatively high, but space is plentiful and relatively

cheap. Prices tend to stay low in these communities as well. The key

congestion challenge is that the urban core can’t enhance public transit

due to a lack of political will, economic strength, or both. Suburbs, with

stronger local economies and policymaking wherewithal, lack the

incentive to build public transit into the urban core. To control

congestion, this type of city focuses on maintaining high-capacity roads

and highways.

Large grids with scattered hubs

There are two forms of Sprawling Metropolises: those relatively

dependent on automobiles, and those with more varied means of

transportation available. Both the “driving” and the “ecient”

metropolises have relatively low population density and small, scattered

hubs of high activity. People mostly travel among hubs — near or far.

The origins of such cities are relatively recent, and the overall layout is

primarily a grid.

24 Strategy&

To combat trac

congestion, city

governments

may build

new roads

and highways

and expand

existing ones.

This strategy

may improve

trac ﬂow in

the short term,

but often leads

to increasing

congestion.

In Driving Metropolises, people tend to travel great distances for work

and leisure. Driving is the preferred mobility method. Public

transportation options are limited, and the cost of parking is relatively

low; there is ample parking and an overall low-to-medium population

density. The key congestion challenges are city sprawl, with long

commuting distances, and lack of transportation alternatives. Thus, as

city populations and GDP grow, so do the number of vehicles on the

streets. To combat trac congestion, city governments may build new

roads and highways and expand existing ones. This strategy may

improve trac ﬂow in the short term, but often leads to increasing

congestion as higher capacity and faster travel speeds induce more

people to drive (usually at the expense of an anemic public transit

system). Such cities tend to put HOV or HOT lanes in place to increase

trac ﬂow and eciency. The key solution combines short-term levers

to mitigate congestion with long-range investment in public

transportation. Doing this will decrease dependence on driving and

decrease the number of vehicles on the roads.

Los Angeles has ranked as the world’s most congested city every

year since 2012. With a population of 4 million, its time spent in

congestion is 102 hours, up 67 percent since 2010. Its cost of

congestion is $19.2 billion. This is primarily driven by three factors:

considerable urban sprawl, rising rates of car ownership, and a lack

of a strong public transportation system. Ridership on the county’s

bus lines has fallen by about 16 percent since 2012. Rail usage has

remained about ﬂat, indicating an increased reliance on cars. Eorts

to mitigate congestion include LA Express Park, a demand-based

parking program that fuses sensor-based technology with real-time

updates to adjust parking rates to meet changing demand. There is

also a high-occupancy toll lane program on some expressways, as

well as an expanded bike-sharing program.

The Ecient Metropolises represent a more eective approach to

similar topography. As with Driving Metropolises, people travel among

small hubs located on a larger grid, but motor vehicles are not the only

mobility method. Even over long distances, people have a multitude of

options. The mobility patterns are complex and spread over a larger

territory in these cities. Public transportation is mature and robust. The

cost of parking is relatively high, and the demand for parking is high.

The key congestion challenge faced by this archetype is that as the city

population and GDP grow, so does mobility demand. People need to

travel longer distances, and the city must maintain strong multi-modal

mobility options. As a result, the focus area for the Ecient Metropolis

is to maintain leadership in mobility research and have legislation in

place to drive transportation innovation.

25Strategy&

These examples

all have several

things in

common. None

of them can treat

congestion as

a problem that

can be solved

purely with

single-owner

automobiles.

Paris is our example of an Ecient Metropolis — with a serious

congestion problem. Its population is 2.2 million, and its time spent

in congestion is 69 hours, up 26 percent since 2013. An old city, Paris

has parking for only 1 million vehicles, but more than 1.5 million

vehicles enter the central business district every day. This results in

illegal parking on the city’s narrow streets, increasing congestion.

The city plans to extend its train and Metro network, and oer

incentives for using public transportation, such as waiving fares

when pollution levels peak. Paris is trying to pass legislation to ban

cars in certain areas, especially around tourist spots, and has

responded to air-quality crises by restricting driving for cars with

odd and even ﬁnal license plate digits on alternating days. The city

will also spend €150 million (about US$170 million) to develop new

cycling routes, pass policies to lower speed limits for cars to as low

as 18 mph, and construct parking spots for bikes. Lastly, it will

promote ride-sharing and implement trac management measures

such as ramp metering and dynamic speed limits on highways to

reduce congestion and rush-hour travel times.

In looking at these examples, you’ll note that they all have several

things in common. None of them can treat congestion as a problem that

can be solved purely with single-owner automobiles. There have to be

attractive (or at least palatable) alternatives to motor vehicles. Second,

managing parking and driver access fees provides leverage, especially

in the short term, and cities adjust. Third, as suggested earlier, the mix

of short-term and long-range remedies, along with attention to both

supply and demand, is critical. In the next section, we look at these

solutions in more detail.

26 Strategy&

Many groups have tried to relieve congestion through simple solutions.

But to create accessible, livable cities, policymakers must address

congestion holistically. For example, charging a high roadway toll

without developing convenient, reliable, safe, and aordable public

transportation will hurt a city’s livability and economy. The most

comprehensive approaches are known as ecosystem solutions, because

they consider the interrelationships among all the elements that aect

congestion: infrastructure, ﬁnance, public transportation, private

vehicles, and new forms of transit including ride-sharing, urban design,

fees, and regulations. Each participant in the ecosystem plays a key role

in distributing the transit load for the movement of goods, services,

and people.

City planners face many signiﬁcant questions, but one is paramount:

whether motor vehicles, particularly single-driver passenger cars, will

have unfettered dominance over the streets of tomorrow, or whether

these streets should be designed to accommodate a broader, more

sustainable array of transportation modes. Beyond that, the planners

will have to consider how much priority to give each form of

transportation, whether to set up dedicated lanes for bicycles or buses,

how to accommodate dedicated drop-o and pickup zones for TNCs and

delivery companies, and how best to provide parking on streets and

elsewhere. There isn’t necessarily one right answer, and the outcome

should be tailored with a comprehensive city strategy in mind. Without

an ecosystem approach, it is not possible to develop this strategy.

Ecosystem approaches convene multiple players to work together, often

to tackle solutions they haven’t considered in the past. One example is

the trend of TNCs entering the motor scooter business as a way to ﬁll

the need for cheap, convenient urban transport for short distances.

Another is the involvement of multiple industries to provide charging

infrastructure for electric vehicles.

An ecosystem approach is not static; it varies by city, and changes with

the changing needs of the population. It considers the interdependencies

of the city, including infrastructure wear and tear and trac ﬂow, and it

Taking an ecosystem approach

27Strategy&

evaluates tradeos such as short-term versus long-range investments,

cost versus convenience, and consumer choice versus policy-driven

solutions. Modeling solutions at a city-planning level is critical. For

example, advanced analytics can help determine the impact of ride-

hailing and robo-taxis on dierent neighborhoods, informing decisions

on investment and restrictions.

Sidewalk Labs’ smart city project in Toronto takes an ecosystem

approach to streetscape design. In August 2018, the Alphabet subsidiary

proposed a new multi-modal street grid that gives priority to public

transit, bicyclists, and pedestrians. The proposed approach, developed

with support from Strategy&, involves pickup and drop-o bays,

pedestrian bridges, bicycle and motor-scooter lanes, and lanes devoted

to trucks with connected vehicle sensors (see Exhibit 4). One advantage

Sidewalk Labs has is a relatively clean slate; it’s planning to remake an

industrial area near Lake Ontario, not an already-bustling downtown

neighborhood.

The mobility hub

One example of an ecosystem approach involves solving the problem of

the “last mile”: the distance between the end of the mass transit hub

Exhibit 4

View of a better street design

Today Future

Note: These are illustrative

streetscape concepts, and

are not meant to advocate

for a particular mode of

transit.

Source: PwC

28 Strategy&

and the ﬁnal destination. Even in cities with excellent transit networks,

buses and trains can’t go everywhere. The mobility hub concept

addresses this problem by aggregating a variety of solutions where

they’re most needed. They place bike, motor-scooter, and car-sharing

services, along with smart parking and easy rentals, at key transit

nodes. These hubs pair well with parking structures that may have

spare capacity, and that reduce congestion by moving vehicles o

the street.

The concept is being embraced in San Diego by a regional consortium

of government bodies called the San Diego Association of Governments

(SANDAG). The consortium has identiﬁed eight locations for mobility

hub prototypes, each with unique demographics and infrastructure. The

goal is to oer a number of services within a ﬁve-minute walk, bike ride,

or drive of the transit center. The prototypes will provide services such

as bike-share, car-share, neighborhood electric vehicles, bike parking,

dynamic parking management strategies, real-time traveler

information, real-time ride-sharing, and micro-transit services, among

others. Development of the sites will begin in 2019.

Mobility hubs lend themselves to adaptive technologies and design

solutions. These could include shared parking logistics lanes, designated

cashless ticket lanes, enhanced wayﬁnding navigation, and advanced

reservations to ﬁnd parking spaces quickly. Future designs will likely

feature retail stores with innovative delivery options, personal facilities

for showering and changing clothes after a bike ride, and valet amenity

services for dry cleaning and package delivery directly to one’s vehicle.

Innovative parking facilities

Although its congestion-ﬁghting potential hasn’t always been

recognized, parking is important to the smooth functioning of a city’s

transportation ecosystem. When there isn’t the right type or amount of

parking, or prices aren’t appropriately set, travelers have more incentive

to circle, cars clog streets looking for elusive spaces, and delivery trucks,

taxis, and TNCs cause chaos at the curb. We’ve already discussed some

parking improvements currently available to cities, but others require

more innovation and perhaps more time to develop.

Parking could potentially be used in new and innovative ways to

mitigate congestion, mainly at the curb. For example, short-term

parking for ride-hailing services and other TNCs could help reduce

circling in highly congested areas, and provide convenient pickup points

where riders could ﬁnd their cars. Long-term agreements, optimizing

short-term pricing and/or design changes, may be required to enable

this solution. During peak hours, cities might require designated areas

29Strategy&

Parking can

also serve as a

hub for shared

vehicle pick-up

and return— a

way for drivers

to choose

from multiple

car models.

This would be

welcomed by the

growing number

of consumers

who use car-

sharing services

like Zipcar.

for ride-hailing vehicles to stop, which could provide congestion relief.

Other opportunities would include partnering for large special events

like concerts, which are logistical nightmares and signiﬁcant proﬁt

opportunities for TNCs. Parking can be used to increase the eciency

and generate substantially higher proﬁts.

Parking can also serve as a hub for shared vehicle pick-up and return —

a way for drivers to choose from multiple car models. This would be

welcomed by the growing number of consumers who use car-sharing

services like Zipcar. Automakers could also participate; some, like

Porsche, are already entering the sharing economy through shared

leases.

There is also a great potential for synergy with delivery or valet-parking

services. Cities without alleys such as New York especially suer from

double parking. In some areas, parking may be designated for use by

delivery companies to prevent their vehicles from clogging the street.

Parking facilities may increasingly be used for shared bicycles and

motor scooters. Dockless e-mobility solutions can clutter the curb and

sidewalks, but the ﬁrst ﬂoor of parking facilities could provide easy yet

nonintrusive access.

In the future, automated parking technologies (or mechanical arms) can

be used to pack vehicles more tightly, increasing the parking density of

current facilities. This could further help in the planning process as less

real estate would be needed to create the same amount of parking

facilities.

Collaborative pilot projects

As new technologies for managing congestion become available, some

cities are initiating comprehensive pilot projects that bring together

many separate elements. These are model eorts with the same end

goal: to increase livability for citizens while reducing congestion.

One such pilot is Boston 2030: a test of next-generation mobility

platforms, including autonomous vehicle deployment, through the

Mayor’s Oce of New Urban Mechanics (MONUM). Two participating

companies, Optimus Ride and nuTonomy (both of which were spun out

of the Massachusetts Institute of Technology), are piloting robo-taxi

services and high-deﬁnition mapping in areas of Boston. nuTonomy was

approved for on-street testing in December 2016; Optimus Ride was

approved in June 2017. Boston is exploring additional partnerships to

address the unique layout of the city and to build a broader connected

transportation infrastructure.

30 Strategy&

Another pilot is called the City of Tomorrow Challenge. Launched in

June 2018, it involves three cities: Grand Rapids, Miami (Dade County),

and Pittsburgh. Companies can submit proposals to address mobility

issues and receive funding through a combination of public and private

resources. Ford, Dell Technologies, AT&T, and Microsoft are among the

business sponsors. The program actively seeks citizen input through

crowdsourcing forums. Winners of the Challenge awards are provided

with funding and required to submit a report to city planners

summarizing their ﬁndings. Early proposed solutions include Integrated

Transportation System (ITS) displays for Miami-Dade’s bus system,

public-road autonomous delivery vans for last- and middle-mile delivery

in Grand Rapids, and expansion of the Port Authority’s ConnectCard

service by allowing users to add credits to their accounts via the use

of smart meters in Pittsburgh.

31Strategy&

The trends that exacerbate congestion show no signs of weakening, and

most cities have not yet fully articulated the steps they’ll need to take

to improve. Nonetheless, as we’ve shown in this report, plenty of tools

are available that can help reduce congestion, and numerous forward-

thinking cities are implementing them in the U.S. and around the world.

To most eectively combat congestion, government leaders,

planners, and other stakeholders should keep in mind a few key points:

Technology is no panacea, but can be a powerful tool. Weigh solutions

that aect supply and demand in both the near and long term. Parking

is an important tool, and has the ability to reduce congestion. Consider

the entire transportation ecosystem to drive city livability. Foster

innovation through collaboration, pilots, and agile policymaking.

The mix of solutions applied will vary across city archetypes.

You can take a proactive approach to congestion by shifting the

trajectory of mobility and making cities far more livable, with

convenient, clean, and cost-eective mobility solutions. Ill-considered

and reactive choices that don’t consider the entire transportation

ecosystem, including parking, are likely to exacerbate congestion.

Public–private collaboration — with a focus on citizen-centered

mobility — is an ecosystem-oriented approach that can lead us to a

future where we want to live.

Conclusion

32 Strategy&

Policymakers have numerous levers to mitigate congestion.

The challenge is to put them together in a way that helps your

particular city.

To organize this comprehensive list of levers, we used the framework

from our ﬁrst guiding principle (on page 16): supply versus demand,

and near-term (i.e., between 2019 and 2024) versus long-term

(i.e., investing now for improvements that may not be usable until

2024 or later).

Near-term supply

These measures don’t require high levels of capital investment, can be

implemented in relatively short order, and can also help route trac in

more eective ways.

• Reduce on-street spaces: Repurpose them for ride-hail pickups,

delivery spaces, or dedicated bus or bike lanes.

• Establish more dedicated bus lanes: These have helped some cities

achieve reductions in congestion and commute times. Alas, this has

not been the case everywhere. In the U.S., the data is generally

inconclusive.

• Improve bicycle routing: Residents are more likely to use bikes if

lanes are available throughout the city and protected from car trac

— often by separating them from city streets. Allow bicycles on

sidewalks in some areas.

• Create bicycle parking: Secure places for commuter bike parking

can attract cyclists who cannot bring their bikes to work.

Appendix: Levers

for reducing congestion

33Strategy&

Near-term demand

These solutions are relatively easy to implement, are mainly policy

driven, and can have an immediate impact by providing incentives to

switch to less congested modes of travel.

• Manage transportation demand: Partner with businesses to

promote alternatives to passenger-car commuting. Set targets for

employers by transportation mode; implement incentives for

alternative commutes; use ﬂextime and work-at-home programs to

reduce travel demand.

• Regulate taxis and TNCs: As New York has done, reduce the supply

of for-hire vehicles by limiting licenses or capping the number of

pickups in particular areas. Implement ﬁnes for low utilization,

which could reduce deadhead miles. Restrict curbside drop-os and

pickups or designate speciﬁc staging areas. Consider the downside of

higher prices and longer wait times before implementing these

restrictions.

• Tighten restrictions on double parking: Reconsider arrangements

that permit delivery vehicles to stop in the street away from the curb.

Enforce double-parking laws more strictly and increase ﬁnes for

violations. Establish more designated stopping areas for deliveries.

• Reduce parking minimums: Reconsider regulations that require

real estate developers to include minimum levels of o-street

parking. Instead, allow the market to set the right number of stalls.

This will reduce excess supply and promote more aordable real

estate.

• Use market pricing to improve on-street parking: Increase

parking-space prices, thus encouraging spaces to turn over more

frequently during peak periods. Remove discounted spaces, so

drivers will no longer circle blocks looking for them. Reinvest the

revenue in the transportation system.

• Install smart parking technologies: Sensors in parking lots can

monitor parking-stall availability, making it easier for drivers to

locate open stalls and reducing circling. Frictionless technologies for

street and parking-lot payment can allow drivers to pay with their

phones, raising compliance rates and making enforcement easier.

Web- and app-based technologies, including better coordination with

navigation apps, can help disseminate information about parking

availability and prices.

34 Strategy&

• Rethink taxes, tolls, and congestion pricing: These economic

incentives are well understood and can target speciﬁc, highly

congested areas or roadways to aect the demand for transport.

Long-term supply

Many of these solutions could be considered today, but due to the long

investment horizon (i.e., infrastructure), the results will not be felt for

years. Other solutions are based on unproven and experimental

technologies, and maturation should be monitored over the next

few years.

• Improve public transit infrastructure: Public transit has the

potential to increase ridership and reduce the number of private

vehicles on the roads. Design for ease of access, making it less

dicult to get into and out of city hub areas quickly and

conveniently. Promote general attractiveness, reliability,

convenience, safety, cleanliness, and comfort.

• Maintain road and highway capacity: Monitor the amount of

trac on roadways and bridges, and plan in advance for necessary

ﬂow-through increases. Do this with care: Increased capacity may

decrease commute times in the short term, but may induce greater

demand in the long term.

• Deploy smart lanes, motorways, and analytics: Implement “smart

motorway” concepts, which use sensor-based technologies to respond

to trac conditions. These include variable speed limits, dynamic

opening and closing of highway shoulders, optimization of trac

lights (using machine-learning algorithms), reverse-ﬂow throughput

lanes that switch direction when commutes change, and advanced

navigation technologies that reroute trac to optimize travel times.

• Prepare for platooning technologies: Improvements in

autonomous driving technology and vehicle-to-vehicle

communication could soon allow tractor-trailers to safely drive much

closer together at highway speeds. It won’t reduce the number of the

vehicles on the road, but it could improve their use of the

infrastructure. With platooning, the gap between two trucks can

be reduced from ~1.4 seconds (for manually controlled trucks) to

~0.4 seconds, which could increase road capacity by more than

30 percent.

• Consider Hyperloop: A successful implementation of this rapid

tunnel-travel technology would theoretically reduce travel times by

50–90 percent, according to the results of some feasibility studies

35Strategy&

and simulations. However, there are still signiﬁcant technological

and commercial hurdles to clear before any Hyperloop project

becomes operational.

Long-term demand

Innovations in managing demand could help reduce congestion. They

typically involve major shifts in trac patterns or improvements in

technology on the horizon.

• Design for delivery drones: Some companies, notably Amazon, are

investing in drones to solve the challenges of “last mile” delivery to

the home. Recently, the company has been granted a U.S. patent for a

delivery drone that can respond to human gestures. When this

technology is ready, local communities will need to be prepared with

the right regulations and infrastructure support.

• Provide o-peak delivery incentives: To reduce congestion caused

by double-parked delivery trucks during periods of high road trac,

consider mandating that deliveries occur during o-peak times. Pilot

programs in certain cities, including New York, have shown early

signs of success, but they can create other challenges (receiving sta

at commercial buildings may not normally work at night, for

example).

• Rethink last-mile routing: In “The Rise of the Last-Mile Exchange,”

Strategy& authors Tim Laseter, Andrew Tipping, and Fred Duiven

propose a new business model for delivery companies: platform

systems where they share pickups and drop-os, thus reducing

congestion and costs.

• Build out the inner ring: In the U.S., 85 percent of the 150 million

people who commute every day nationwide use a motor vehicle to

enter a dense inner city. Much of this congestion could be avoided

by converting the “long trip” all the way in to a “short trip,” where

residents park at the edge of the inner ring and use other modes of

transportation to get around the city.

36 Strategy&

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