26 sep 17

Latin America's evolving urban mobility

Latin America's culture of traditional urban mobility is on the brink of a major change as the demand for more "green" and sustainable alternatives meets technological advancements in the automotive and fleet management industry.

While larger cities in countries throughout Europe, as well as some in the United States and China are further along at embracing the new and growing urban mobility culture, much of Latin America is still tied to traditional transportation such as buses, urban trains, and owning a car.

Although many governments throughout Latin America are carrying out public-private partnerships (PPP) to build metros, monorails, bus-rapid transit (BRT) and light rail transit (LRT) systems to help support growing populations in large cities, they are also passing new vehicle related laws.

Most of the new legislation is aimed at changing the mindset and overall culture of citizens and corporate fleet managers by stimulating them to invest in electric vehicles (EV) or hybrid cars.

In Brazil, owners of these types of cars are exempt from import tax as well as the annual IPVA personal vehicle tax. Moreover, drivers in the city of São Paulo are exempt from traffic control program "Rodizio" which restricts cars with a particular license plate number from driving in the central areas of the city.

Meanwhile, Chile was the first Latin American country to adopt the Euro-5 emission standard, and Mexico and Peru are working on adapting it soon.

Other measures in these countries include the Semarnat fuel efficiency target under discussion in Mexico, the vehicle fleet renewal program in Peru, and the Green Tax law and fuel economy label scheme which are already running in Chile.

Finally, Argentina gives progressively increasing tax breaks on cars US$25,000 and more and Colombia reduces import duties for EV (0% tax) and Plug-in hybrid electric PHEV (5% tax).

Innovation on the rise

Along with these changes are innovative ideas which have been popping up around Latin America over the last few years, more so in the highly populated regions of São Paulo and Mexico city. 

Among them are e-hailing services such as Uber, 99Taxis, Wappa, and Easy Taxi, as well as other mobility solutions like the urban bike-sharing program Bike Sampa developed by Brazilian bank Itau-Unibanco and long distance ride-sharing program BlaBlaCar.

In the São Paulo metropolitan region, Latin America's corporate hub, many companies are working toward more sustainable employee integration through the use of innovative third party programs and smart mobility solutions of their own. 

Besides local corporate programs such as JoyCar which permits car sharing and Bynd which offers real time ride sharing within a company or trusted network, some business parks have their own bike sharing systems such as the Rochavera Towers in the Berrini business district.

Most companies also offer their employees the Bilhete Unico Vale-Transporte, an all-in-one transportation benefit card in which employees can use for buses, metros, intercity-trains, and bike-sharing.

Finally, OEMs like Audi, Ford and General Motors have also been conducting car sharing pilot projects of their own. For now, they are used by employees at their manufacturing facilities and corporate offices.

Authored by: Daniel Bland