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Hi there,

We are closely following the news related to the coronavirus outbreak. Not only is the virus a looming threat for the people living in affected regions, it also impacts businesses and travel behavior in particular. 

Our local Asian team has been grounded in Singapore since our main priority is to keep them safe. Let’s all hope that the worst of the outbreak is already behind us.

However, canceled business trips don’t mean we can’t continue analyzing the Travel and Mobility Tech scene in much detail. To get a sense of how the coronavirus impacts people’s daily life, especially in China and how tech has become a lifeline for millions of people who are mostly holed up indoors, check out our research findings of the week below. But first, important airline news!


Today's reading time: 6:19 minutes.

Lennart Dobravsky
Director Research & Intelligence, Lufthansa Innovation Hub

 Airline 

Will this new (digital) airline solve the industry's mobile-app fiasco?

If you have been reading our newsletter for a while, you know that we are big advocates of mobile apps by airlines that strive to offer more than just standard flight-booking and check-in functionalities. There are so many more traveler needs that airline apps should cater to.

Just think about all the irregularities that might occur during a trip from A to B, such as flight delays, cancellations or lost baggage. For all these events, digital (self-) assistance in the form of a well-functioning and comprehensive mobile app would be a lifesaver for air travelers – unless you enjoy waiting in line at the airport’s service center for hours. 

Travelers' mobile-app expectations are rising

Customers (not only Gen Z) will soon expect that their carrier is always digitally available, providing end-to-end support throughout every part of the journey. This includes booking a taxi ride from the airport to the hotel seamlessly in the given airline app – without having to research and download the travel destination's specific ride-hailing providers.

And it doesn't stop here. Why not offer travelers real-time currency information, as well as voice-based translation services through the airline app, so that the arrival in a foreign-country feels less frightening and chaotic?

Unfortunately, most airline apps today are very restricted when it comes to their range of digital services. On top of that, many airline mobile apps are bug-heavy and require way too many clicks for straightforward requests, such as checking in for a flight as our Airline Digital Index shows.

Airline apps compete not only with one another

What many airlines don't seem to grasp yet: travelers don't set their mobile-app expectations according to other airlines, but by the convenience, efficiency and level of quality offered by the likes of Amazon and Uber.

The consequence: many of today's travelers avoid downloading airline apps in the first place – and those who do, rarely engage with them compared to how often they interact with other transportation apps (e.g. ride-hailing).

Let's look at some data 

To further strengthen this point, check out the relevance and engagement rates for more than a dozen leading Travel and Mobility Tech mobile apps.
You can see that none of the major airline apps are able to reach the engagement rates (X-axis) and size levels (Y-axis) of leading transportation apps in our sector, such as Uber, Booking, Tripadvisor, Grab or Go-Jek. And navigation apps like Google Maps and Waze play in a totally different league.

This airline executive spotted the digital opportunity

One of the industry's most renowned innovators, JetBlue founder David Neeleman, seems to be jumping on exactly this digital opportunity with his newly launched airline. It's called Breeze Airways and is supposed to resemble more of a tech company than a classic airline.

In a rare
interview in 2018, Neeleman shared some initial thoughts on his latest endeavor, claiming Uber and Amazon would, indeed, be the role models for his new company, especially when it comes to consumer interaction. Neeleman's latest comments in a conversation with Skift this week go even one step further as he’s planning to develop what he calls the most advanced mobile app in the airline industry.

“Anything you can imagine you needed to do, you could do on our app,” he says. “You can change or cancel. Or order a filet mignon sandwich if you want. You can pick whatever you want.”

Big plans! Let’s see if Breeze is able to keep all those promises and deliver the type of digital airline that we believe can give a carrier a long-term competitive edge.
 Trends 

Research of the week: the impact of coronavirus on Travel and Mobility

The outbreak of the coronavirus has had a severe impact on global tourism. Flights to and from China have been canceled, the WHO has declared the virus a global health emergency, and governments around the world are on full alert, making drastic efforts to contain a global spread of the virus.

Obviously, the local Chinese Travel and Mobility Tech scene has been suffering a lot. As millions of residents in China are advised to stay at home, ride-hailing demand, for instance, has plummeted as we can see from Didi Chuxing's most recent mobile app usage numbers.
Despite the lockdown of many Chinese megacities, the business world needs to keep spinning. Isolated from the outside world, tech has become a lifeline for millions of people. Many people have been working remotely from home for the last two weeks. Technology is being used to substitute face-to-face business meetings.

Take a look at the most recent surge in popularity for China's leading video conferencing and business messaging apps DingTalk and WeChat Work:
We see similar trends for food delivery apps and online video platforms where people share memes and entertaining content with friends and family. Also, demand for educational and virtual-school apps grows in demand as Yahoo Finance reports.

For more hidden insights and unconventional data points on China's Travel and Mobility Tech ecosystem, sign up for our future email newsletter curated by our local team on the ground.
 Startups 

Who is really betting on air-taxis?

The air-taxi hype seems to be reaching a certain tipping point these days with several tangible market indicators (e.g. capital invested in respective startups) pointing towards a scenario that will see flying cars fill the skies above our cities in the foreseeable future.

We are not overly bullish when it comes to the timeline. Our current best-educated guess: it will take another 10-15 years until VTOLs will be transporting people through the air on a regular and commercial basis.

The good news: several corporates have joined the air-taxi game

In our previous newsletter edition, we covered the most well-funded startups in the air-taxi space. Today, we want to deep-dive into the companies backing these promising players.

For this, we researched and listed the four biggest investors of the top three air-taxi startups: Joby Aviation, Lilium and Volocopter.

What we find most interesting: not only high-risk-high-reward-seeking VCs make the list, but several well-established (and usually risk-averse) corporations have skin in the game, for example, the car manufacturers Daimler, Toyota, and Geely.

Disrupt your own business

The involvement of these automobile manufacturers does make a lot of sense in our opinion as air-taxis (if brought to life) will most likely compete with car-based urban transportation on the ground rather than with short- and long-haul flights offered by airlines.

Placing reasonable bets on flying-car concepts seems to be a wise move by Automotives as part of their long-term
Horizon Three innovation strategy. 
If you want to learn more about our current take on the emergence of air-taxis, get on our waiting list for a dedicated newsletter that we will publish soon.
 Press Picks 

Our recommended must reads 

GANGSTERS PARADISE – Peer-to-peer car rental apps Getaround and Turo are surging in popularity among both car owners, people without cars and those who need a vehicle to commit crimes. The consequence: wrecked cars, homicide, and bags of meth.
 Read more in NBC News
HOW TO BOARD A PLANE? – One of air travel's most discussed challenges seems to be solved: how to board an airplane most efficiently. It turns out that letting slower passengers board first actually results in a more efficient process and less time before takeoff according to the latest research.
 Read more in arstechnica
WHO NEEDS SUPERSONIC JETS? – British Airways sets record for fastest subsonic flight from New York to London. The flight, which took four hours and 56 minutes, reached a top speed of 825 miles per hour, according to flight-tracking data.
 Read more in The New York Times
MEASURING AV PERFORMANCE – Interesting piece from GM's Cruise on autonomous car-testing metrics: ‘the Disengagement myth’. Apparently, the stat that people use to see who’s ahead in AV development doesn’t mean much.
 Read more on Medium
SUSTAINABILITY PROGRESS – Berlin-based startup Tourlane claims it will offset the company's and travelers’ carbon emissions for the entire year in 2020. The company which specializes in tailor-made trips included estimated emissions from operations as well as those generated by customers from flights, accommodation, ground transport, and food.
 Read more in Phocuswire
 Funding Update 

Most recent Venture Capital deals

 = Exit Alert (startup listed at the stock exchange or got acquired)

 = Unicorn Alert (post-deal company valuation at >$1B) 


Astra – the US-based rocket launch startup raised more than $100M from Airbus Ventures, Innovation Endeavors, and further investors. 

Vogo – the Indian scooter-sharing startup raised $35M from Lightstone Aspada and further investors.
 
Turo – the San Francisco-based peer-to-peer car sharing marketplace raised $30M from Manhattan Venture Partners and Allen & Company LLC. 

Impala – the London-based interface that allows products to connect to hotel systems raised $20M from Lakestar and Latitude Ventures. 

Habitas – the US-based experience-driven hospitality startup raised $20M from Tim Steiner and Travis Kalanick. 

Spatial – the US-based mixed reality startup raised $14M from White Star Capital, iNovia, and further investors. 

GO Sharing – the Dutch e-scooter sharing platform raised $12.2M from Rabobank Corporate Investments and further investors. 

H2O Hospitality – the Japanese vacation home management startup raised $7M from Samsung Ventures, Stonebridge Ventures, and further investors. 

Tourkrub – the Bangkok-based package tour startup raised $5M from undisclosed investors.

Get-E – the Dutch ride-booking startup for business travelers raised $2.46M from Axivate Capital. 

Wishbox – the Tel Aviv-based hotel guest experience management startup raised $2.5M from BNF Capital, and further investors. 

AutoFlightX – the Munich-based electric air mobility company raised an undisclosed amount from TDK Ventures. 

Optym (airline optimization unit) – the airline tech unit was acquired by Amadeus for an undisclosed amount. 

Immfly – the Spanish in-flight experience specialist raised an undisclosed amount from BoeingHorizonX. 

 Anterin – the Indonesian ride-hailing firm was acquired by MNC Group for an undisclosed amount. 

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