What Luxembourg can teach the world about public transportation

Enrique Dans
Enrique Dans

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Luxembourg has become the first country in the world to provide free public transportation throughout its territory, one of the priorities of its recently re-elected prime minister, Xavier Bettel, to help alleviate the Grand Duchy’s chronic traffic congestion.

Data shows that drivers spend 33 hours a year trapped in traffic jams in Luxembourg, significantly lower than the 42 hours residents in Madrid have to endure or, of course, the 102 for Los Angeles, to give just two examples of cities where I have lived (you can see the statistics for your city on this site). Obviously, managing transport in the tiny Central European country (2,586 square kilometers and 576,249 inhabitants) is considerably simpler than for a large capital of several million inhabitants, but the value proposition of either free or a flat rate public transportation model is becoming increasingly popular.

I recently discussed on Forbes the case of Tallinn, the capital of Estonia, which joins that of many other cities — 24 in France alone — where public transport is completely free, as well as many others, such as Paris, that are considering it. Others, such as Helsinki, have experimented with charging a flat monthly fee for the different modalities of urban transportation, managed through an app, Whim, which seems to be working. It may be that a flat rate is more effective in encouraging people to use public transport than a free service, given that we tend to want to get our money’s worth. Discounts can also be provided for the unemployed, people on low incomes, students, pensioners, etc. Uber has applied flat rates in some cities, generating a strong increase in demand and attracting people who previously used their own cars.

The obvious appeal of public transportation is further boosted when we take into account the savings made from not having to pay supervisors and ticket collectors, and in the not-too-distant future, drivers. Free transportation underscores the idea of the city as a service, part of the value proposition of a city that can be paid for through taxes, while establishing a series of APIs other providers can connect to that offer additional transportation options and share their data with municipal authorities. This model will be a key weapon in the fight against the private car, a modern-day plague, the common enemy, now defended only by a selfish minority putting their own interests over increasingly important global issues.

Better quality public transportation, whether free or low-cost, and probably autonomous (Waymo launched its autonomous taxi service on December 5), is set to be one of the most important assets for cities in the coming years as they redefine their transportation models and implement urgently needed change.

(En español, aquí)

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Enrique Dans
Enrique Dans

Professor of Innovation at IE Business School and blogger (in English here and in Spanish at enriquedans.com)