Latin America Shows Public Transit Isn’t Everything

Trains and buses account for about half of all journeys in cities like Mexico City and Buenos Aires, but the region lags on innovation and electrification.

Latin America is an urban powerhouse. The region boasts six of the world’s 33 megacities, and two of the top five – Sao Paulo and Mexico City. Most of its metropolises have extensive mass transit systems that transport millions for some of the cheapest fares on the planet.

Yet the region is struggling to make the transition to 21st century mobility. It lags behind leading cities in Asia, Europe, and North America in terms of innovation, including the adoption of electric vehicles. That’s a challenge at a time when the threats of climate change and COVID-19 have people around the world demanding cleaner, greener transport options.

The region’s cities score in the bottom half of our Urban Mobility Readiness Index, jostling with cities like Doha, Johannesburg, and Mumbai. They lack the holistic approach taken by the top-scoring cities on our index, like Stockholm or Singapore, which are hubs of mobility innovation and offer plenty of green, easy options for moving about. There are some bright spots that exist currently: namely, a comprehensive and efficient public transit and mobility sharing networks. Change is in the air, and recent green mobility initiatives in cities like Mexico City and Rio de Janeiro show encouraging signs for the future.

Where Latin America truly shines is the widespread use of public transit. It accounts for roughly half of all journeys in Lima, Mexico City, and Buenos Aires. That percentage is higher than those in London and Singapore, and rivals that of Tokyo.

High public transportation use didn’t just happen in Latin America. Municipal governments have made conscious choices to make mass transit more convenient and accessible. While not every Latin American city offers 24/7 service, Bogota and Sao Paulo score higher than London, San Francisco, and Shanghai on public transit operating hours in our index.

The average cost of a monthly public transit ticket in Mexico City or Buenos Aires ($14 and $17, respectively) is among the most affordable compared to the other 48 cities in our index. That’s not just cheap in absolute terms; it also represents a small fraction of residents’ income. Average riders in Mexico City, for example, spend less than one percent of their income on public transit, while those in London or Beijing pay about seven percent.

And when Latin Americans aren’t riding a bus or train, they’re catching a lift in other ways. The region has a buzzing shared mobility economy: Sao Paulo has a more competitive sharing economy – defined by the number of bike-, car-, ride-, and scooter-sharing companies – than New York, Seoul, and Paris, according to our research.

But the strength of Latin America’s public transit and shared mobility networks isn’t matched in other key areas. While there’s no one feature that makes cities prepared for the next generation of mobility, Latin American cities lack the holistic view – including such elements as fostering innovation and market attractiveness for the private sector – that characterizes the leaders in our index. Cities need mobility networks that are multimodal, resilient, and green to meet future demand and cope with disruption of all shapes.

Latin America’s metropolises aren’t there yet. They score poorly on the international connectivity of their airports, academic and research ecosystems, investment in connected and autonomous vehicles, and electric vehicle sales and charging station availability.

The latter point is particularly important for the region because private car ownership is on the rise along with dangerous air pollution levels. Transport accounts for one-third of carbon dioxide emissions in Latin America and is an industry that’s rapidly expanding: The region’s vehicle fleet may triple over the next 25 years. The United Nations estimates that if Latin America’s big cities replaced their buses and taxis with electric vehicles, they would save $64 billion in fuel costs and 300 million tons of carbon dioxide emissions, and avert more than 36,000 premature deaths by 2030.

Buenos Aires and Mexico City score higher than Beijing and Shanghai on social impact – an index element that measures factors like cheap public transit and good air quality that can make city living attractive. But emphasizing greener forms of mobility can raise the region to new heights. The wheels are already turning to advance electric vehicle adoption in some Latin American cities.

Buenos Aires has been experimenting with electric buses while others, like Sao Paulo and Mexico City, are working with the International Council on Clean Transportation to adopt the same technology – even winning $900,000 from P4G, a sustainability coalition funded by Denmark, to do so. Moreover, Mexico City, Rio de Janeiro, and Sao Paulo offer incentives like tax exemptions for personal EV purchases. These cities score higher in EV incentivization on our index than Tokyo and North American cities like Dallas and Montreal.

While the tax exemptions are a nice perk, they’re not unique in developed countries. What makes Latin American cities stronger in driving EV adoption are the non-monetary incentives: Mexico City offers plug-in electric vehicles access to preferential parking while Sao Paulo exempts electric vehicles from restrictions on car traffic.

Latin American cities have a sturdy foundation to build on, thanks to their strong public transit network and mobility sharing economy. With many of these cities being proactive in driving EV uptake, the region has a brighter future ahead.