The impact of urban mobility on service stations
The role of fuel retail sites in urban areas is being tested by anti-car regulations, improved public transportation and a shared mobility ecosystem. Where does that leave service stations?
The era of petrol stations as vehicle-centric locations that supply liquid fuels is coming to an end. Changing consumer behaviour and new technologies are paving the way toward retail and mobility hubs. The disruption to a retailer’s business will depend hugely on geography – highway stations will become multi-energy destinations with large food offering while sites in urban areas will have to bet on retail and mobility.
Retailers operating in urban areas are looking at how to take a customer-centric approach that adapts to the latest trends – last mile logistics, advanced mobility, sharing economy and multi-energy offering. Brands like Shell, BP, and Total are investing in fast-charging, micro-mobility and EV subscription schemes, typically as upgrades and complements to their forecourt portfolios.
A new study from Juniper Research identified Berlin as a leading city due to its focus on improving its transport infrastructure, such as with the mobility-as-a-service (MaaS) app Jelbi, which brings together public and private transport.
“Europe, as the birthplace of MaaS, has seen significant development and deployment of the concept over the past few years. As such, transit in leading European smart cities is a central part of future strategies for smart city development – cities aiming to follow this approach must take a coordinated method to transit, embracing the benefits of MaaS in reducing congestion,” commented research co-author Nick Maynard.
With an aggressive strategy to get cars out of European cities, a blossoming shared mobility ecosystem and a rise in last mile delivery, where does it leave service station operators?
“Near-term we expect fuel retailers to definitely deploy e-scooter & e-bike sharing stations, potential charging or battery swapping and possibly maintenance stations for these vehicles,” explains Dr. Markus Hagenmaier, Associate Director, Mobility Innovation & Digitalization at Boston Consulting Group (BCG).
Back in 2020, Aral unveiled its first urban station of the future in Berlin – a multifunction fuelling station that uses a ‘microgrid’ and has a convenience store. The site included charging points, battery swapping stations and e-scooters. One of the key factors behind this new concept is development of Jelbi in Berlin.
Analysts, such as BCG, agree that the modern mobility hub can incorporate a range of options including a battery changing outlet for e-bikes, cargo bikes and small vehicles, e-scooter sharing, bike sharing, ultra-fast EV charging points for cars and small vans, parcel connection facility and a good connection to public transport (tram, metro, bus, train). Futuristic visions on the future of these locations include air taxi landing spots, maintenance hubs for autonomous taxis and robotic refueling.
Many players wonder if adding these services will actually have a positive impact on their revenues. With fuel and tobacco losing value, how do they maximise their real estate?
“Whilst it is probably too soon to tell if mobility hubs can be deployed profitably at scale by a major retailer that is responsible for all the investments, it can definitely be profitable if retailers choose to mainly act as landlord of the mobility providers. Besides pure profitability, retailers will have to move in this direction on selected sites to defend and grow their core business around fueling/charging, convenience store and to unlock additional revenue opportunities by attracting more customers to their own locations,” says Hagenmaier.
Innovative retailers such as TanQyou always saw their stations as part of a wider mobility proposition. This network of unmanned stations in the Netherlands saw an opportunity and developed its own MaaS products. With their app a customer can pay for fuel, find parking, connect to an EV charger, jump on public transport and use other last-mile transport options such as bicycles. Inclusive platforms that offer customers a seamless experience will be an important feature of tomorrow’s mobility ecosystem, and retailers such as TanQyou have understood that.
When asked about the role of technology in mobility, Hagenmaier says there are two main cornerstones for these locations. “One is the physical location and how attractive it is. The other is the software that allows end-users (primarily B2C) to easily identify the mobility hubs and use them – a one-stop-shop that could even go beyond MaaS and add EV charging functionality, purchases in the convenience store and any other location-based services,” he adds.
The growth of e-commerce has also placed service stations as an ideal logistic hub for processing and transfer facilities for the carriers or lockers for customers. Petronas, Malaysia’s state-owned oil and gas company, is using the size of its network to boost its delivery service, Setel Express.
As retailers navigate the journey of transforming their stations from vehicle-centric to customer-centric, location, regulations, city, customer behaviour and grid connection will determine which types of services they should offer. Despite the lack of clarity around profitability, it may be a journey they can’t afford to miss.
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