This study investigates the potential of modular vehicle concepts and consolidation to increase the efficiency of urban freight and passenger transport. Modularity is achieved by connecting multiple vehicles together to form a platoon. Consolidation is realized by integrating passenger and freight demand in the routing problem. Vehicles are specific for each demand type but can be connected freely, allowing the transport of multiple demand types in the same platoon. The routing problem formulation considers travel time costs, travel distance costs, fleet size costs, and unserved requests costs. The operations are modeled in a novel modular multi-purpose pickup and delivery problem (MMP-PDP) which is solved using CPLEX and Adaptive Large Neighborhood Search (ALNS). In an extensive scenario study, the potential of the modular vehicle type is explored for different spatial and temporal demand distributions. A parameter study on vehicle capacity, vehicle range and platoon cost saving is performed to assess their influence on efficiency. The experiments indicate a cost saving of 48% due to modularity and an additional 9% due to consolidation. The reduction mainly stems from reduced operating costs and reduced trip duration, while the same number of requests can be served in all cases. Empty vehicle kilometers are reduced by more than 60% by consolidation and modularity. A large-scale case study in Stockholm highlights the practical applicability of the modular transport system. The proposed model and optimization framework can be used by companies and policy makers to identify required fleet sizes, optimal vehicle routes and cost savings due to different types of operation and vehicle technology.@en