• By 2050, a third of Japan's population will be aged 65 or older;
  • As people age, they need new ways to get around, particularly alternatives to driving, but public transport provision is far from universal – even in Japan;
  • New mobility initiatives, many based on the principle of “mobility as a service” (MaaS), could fill the gap, especially in under-served rural areas.

Societies around the world are ageing at unprecedented rates, as people live longer and have fewer children. Japan is at the forefront of this phenomenon: by 2050, a third of the population will be 65 or older, up from an already world-leading 25% today.

One challenge in ageing societies is transportation. As people age, they need new ways to get around – particularly alternatives to driving. Trains and buses can often substitute for private cars, but even in Japan, a country renowned for its extensive and efficient public transportation, service is far from universal. In rural areas especially, where populations are even older than average and traditional kinds of public transport are scarcer, the need to fill “mobility gaps” for the elderly is acute.

The World Economic Forum Centre for the Fourth Industrial Revolution Japan has looked at rural Japan for hints about the world’s mobility future. As our societies age, our habits and technologies change and existing forms of public transport become harder to sustain. How can we make sure that everyone has the means to get around?

The challenge in rural Japan is big. In many parts of the countryside, the over-65s already account for more than one-third of the total population, a generation earlier than the nation as a whole. While the elderly in Japan are often healthy, total life expectancy is nonetheless rising faster than so-called “healthy life expectancy”. This means the period when people’s day-to-day mobility is restricted is getting longer, not shorter.

Depopulation compounds the problem. Decades of migration to big cities like Tokyo and Osaka means rural populations have gotten smaller as well as older. This, in turn, has led to declining income for public transport operators just when the people who've stayed behind need their services the most. We found, for example, that a full 85% of rural bus operators in Japan operate below the financial break-even point.

Healthy life expectancy vs life expectancy in the G20
Healthy life expectancy vs life expectancy in the G20
Image: C4IR

MaaS transport for the countryside

New mobility initiatives are trying to fill the gap. Many are based on the principle of “mobility as a service” (MaaS): a digitally supported approach that lets users plan, book and pay for different kinds of transportation through a single seamless channel, such as a smartphone app.

MaaS is taking off in many parts of the world, though users tend to be relatively young, urban-dwelling and comfortable with digital technology. In that sense, MaaS operators in rural Japan are taking the concept to a new frontier. The lessons they’re learning, and the best practices they’re establishing, will serve as a guide for other countries as they grapple with their own rural-transport challenges.

There are more than 80 MaaS businesses in Japan, most of them operating in rural areas.

How MaaS businesses in Japan operate
How MaaS businesses in Japan operate
Image: C4IR

Growth in the sector has rapidly increased since 2018, when the government made MaaS a focal point of its Future Investment Strategy infrastructure-development programme. In our study, Transforming Rural Mobility with MaaS, we identified several crucial factors that can help MaaS initiatives succeed in inevitably difficult rural environments. These include:

  • A collaborative approach: successful rural MaaS operators work closely and cooperatively with existing public-transportation services;
  • Innovative business models: successful operators focus on developing new approaches to profitability as much as new technology;
  • A flexible, user-oriented mindset: successful operators are quick to adapt their services to the needs of rural users;
  • Wide focus: successful rural MaaS projects can support other social and economic goals, such as tourism promotion or supporting health and well-being.

Shobara, a depopulated town in the mountains of Hiroshima prefecture, has bucked a trend toward reduced bus service by incorporating MaaS-based solutions. The town has added new bus stops, cutting the distance that elderly people must walk to catch the bus. To make the expanded service financially and logistically viable, it has introduced smaller vehicles and a reservation system: buses stop only when users have booked in advance.

Elsewhere, “Choisoko,” a MaaS service started in Toyoake City, Aichi prefecture, found that its initial electronic-media promotions weren’t reaching its elderly target users, so it organized in-person community meetings and placed notices in paper newsletters and in the lobby of the city hall. It also takes bus reservations by telephone, helps organize community events for the elderly, supporting healthy living while increasing demand for transport; and finds alternative sources of income to fares and government subsidies by allowing local businesses to “sponsor” stops near their locations.

How a shared ride service in Japan's rural areas can work
How a shared ride service in Japan's rural areas can work
Image: C4IR

Choisoko has also been careful to supplement, rather than compete with, existing transport operators. Its “Toyoake model” has been expanded to 13 locations around Japan as of December 2020 and is planned to expand to at least 20 locations within the 2022 fiscal year.

Closing the delivery gap

The rural transport challenge is not limited to moving people. It’s also about moving goods. The rise of ecommerce, which has grown further during the COVID-19 pandemic, threatens to widen gaps between rural and urban areas when it comes to delivery infrastructure.

Denser, more urban areas are more economical places to operate for the delivery services that support online shopping and other parts of the digital economy. This is especially true when it comes to the so-called “last mile”, where high-efficiency bulk transport gives way to package-by-package delivery to customers’ homes. That “mile” is inevitably longer in the countryside. Delivery systems’ ability to serve it, some experts say, is on the verge of collapse.

But collapse isn’t inevitable. In another recent study, Towards efficient and sustainable last-mile logistics – lessons from Japan, we showed how innovative new technologies such as autonomous delivery robots have the potential to make last-mile logistics more viable while simultaneously reducing its environmental impact.

In both mobility and delivery, new technologies can support quality of life for the elderly and the depopulated rural areas where many older people live. Making the most of technology – particularly at socially transformative scales – requires new policies and frameworks. With the right approaches, we can ensure an inclusive future for transportation.