1. Why the boom in scooters?
Cars often aren’t the quickest way to travel in dense, urban areas. Many cities looked to bicycle-sharing services and bike lanes as a better option for shorter trips and as a way to reduce carbon emissions. Electric scooters, which can cost less than $2 per ride, are an offshoot of that. Investors looking for the next Uber Technologies Inc. and Lyft Inc., the app-based car-hailing services, are adding to scooter mania by pouring money into the startups, touching off a city-by-city race to become the premier scooter brand. Not to be left behind, even Uber and Lyft are launching competing scooter businesses.
2. How widespread have they become?
Bird, started by a former executive of Lyft and Uber, and its main rival Lime both operate scooter services in over 100 cities worldwide. Bird kicked off the trend in late 2017 with its launch in Santa Monica, California. Unlike certain bike rentals that have to be left in designated racks, dockless scooters can be left on any public sidewalk after a rider is finished with their journey. They are then picked up at night by freelance contractors, charged and returned to designated pickup areas.
3. What kind of resistance did they run into?
Scores of unattended vehicles on city sidewalks have resulted in pushback from people complaining of urban chaos, and some cities have started to cap the number of scooters they’ll allow. In January, officials in Austin, Texas, suspended licensing for rental e-scooters and bikes in order to reassess the safety and reliability of the devices. Austin has as many as 14,000 dockless electric scooters, according to data from the city’s transportation department. Other U.S. cities have much smaller fleets. The San Francisco Municipal Transportation Agency recently suggested it would double the number of scooters permitted on its streets from 1,250 to 2,500, but only if scooter companies sign up more low-income customers.
4. What about outside the U.S.?
Bird and Lime have expanded aggressively into Europe in the last year; Paris has an estimated 20,000 e-scooters. Lime Chief Executive Brad Bao announced in June that the company will soon drop thousands of electric scooters on German roads after lawmakers legalized them in May, with speed limits and other conditions. Bird and Lime have also established a presence in Spain, Portugal and other European countries as well as the Middle East and Latin America.
5. Have any countries barred them?
Yes, most notably the U.K. Strict laws there classify the scooters as motor vehicles that require drivers’ licenses and are subject to tax and insurance. In March, the U.K. government opened a major review of current mobility laws -- including some that date back to 1835 -- during which the ban on e-scooters will be reconsidered. But the restrictive laws have not stopped Brits from joining in on the micro-mobility craze. Privately owned electric scooters are widely used in cities such as London, despite riders risking fines and penalty points on their driving licenses if stopped by the police. Stand-up e-scooters have also been banned on roads in major Chinese cities like Shanghai and Beijing since 2016, but they are still prevalent in “closed spaces” such as parks. Scooter manufacturing is a booming industry in China; that’s where the vast majority of e-scooters used globally are made.
6. Is this a profitable business?
No, but investors think it can be: The valuations of Bird and Lime are almost $2.5 billion each. But skepticism is warranted. It could be just a fad. Even if it isn’t, scooter companies must have the capital to absorb costs beyond acquiring fleets of vehicles, including maintaining them and charging their batteries daily. There’s little reason for riders to be loyal to one company, and if rivals compete by lowering prices, they could shave away much of their margins. Lime has said it can raise revenue from advertising, but this is an untested idea. Scooters could end up being one option in an integrated transportation service providing everything from short-term car rentals and bike-shares to ride-hailing and train tickets, putting the upstarts at a disadvantage to Uber, which is moving in this direction.
7. Are they safe?
Some officials worry they are not. Safety concerns are prompting bans in several cities around the world and are also making lawmakers hesitant to legalize e-scooters in certain countries and states. A number of fatal accidents involving scooters have renewed concerns about their safety. A YouTube star was killed in London in July after her privately owned scooter was hit by a truck, making her the first person in the U.K. to die while riding one. Some U.S. officials have also cited safety concerns in their opposition to electric scooters. Nashville’s mayor said in June that he would recommend banning them after a 26-year-old resident died in a scooter accident, and Chattanooga, Tennessee, banned dockless electric scooters and bikes for six months in July. The public health impact from electric scooters is “generally unknown,” according to the Centers for Disease Control and Prevention, or CDC. But Consumer Reports reported in February that there have been about 1,500 incidents of people seeking treatment for e-scooter-related injuries in the U.S. since late 2017. A study of medical records by the CDC of people who used emergency services from September to November in Austin, Texas, also found that almost half of scooter-related injuries were “severe.”
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