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By Aaron Burdick
Special to the Financial Independence Hub
Are electric scooters the future of urban transport?
Only time will tell, but at this point, the buzz is huge about these cool vehicles gaining mileage around city streets and sidewalks across the United States and as far away as China.
Bird, Skip, Scoot, Lime and Spin are some of the popular electric scooter rental services giving cars, SUVs and trucks a run for their money, and talk about the economic advantages.
It’s simple, fast and done from your cell phone app. For instance, the Bird company will charge $1 to start each ride and 15 cents per minute after that. The dockless scooters are activated and unlocked via your smartphone, and you get billed by credit card.
Dockless bike and electric scooter rental businesses seem like no-fail methods for big companies and investors to make an easy buck, lots of them. However, oversaturation could become a problem for these modern, eco-friendly modes of urban transportation, and China is one example.
Oversaturation in China?
According to an item in the BBC, in the country that launched the dockless bike phenomenon it has possibly become too much of a good thing. Two of China’s leading bike-sharing companies have yet to turn a profit there, and mountains of abandoned bicycles piled along city sidewalks show that maybe the fad is wearing off.
Some in sunny San Diego, CA, are not worried though and see the investment in scooter and bike share programs as an excellent approach to creating more accessible and livable cities.
LimeBike, based in San Mateo, is being funded by Silicon Valley’s leading VC firm Andreessen Horowitz. The brand is also branching out to Europe and deploying electric scooters, electric-assist bikes and the standard pedal bike. LimeBike is currently available in 46 markets.
Electric scooter and bike sharing companies are more than happy to share their numbers because someone’s riding these “green” vehicles. For instance, Lime found that in the first three weeks of usage in the San Diego market, more than 21,000 riders who hopped on took more than 55,000 trips.
Bloomberg Businessweek reveals that both the Lime and Bird companies have valuations at one billion dollars each. These scooter/bike companies, however, have to absorb all kinds of costs like upkeep of the vehicles and in the case of scooters, charging their batteries every day. In addition, companies like Bird, Skip, Scoot, Lime and Spin have to deal with growing city regulations. Their scooters and bikes are not always welcome at the start when they invade a city.
Every community’s local government is unique in how they want these bike-share and scooter-share vehicles taking up space. For example, some cities require permits, exclusive franchises or a limit on how many vehicles can be allowed into the share program. The laws are different as well: in California, electric scooters should ride in bike lanes, and as of September 2018, riders aren’t required to wear helmets. In DC, riders can actually ride on some sidewalks. The laws vary drastically from state to state, and almost always they’re deployed before there are regulations.
Litany of complaints
There have been complaints by residents about scooters and bikes being carelessly tossed about on sidewalks and in streets and riders knocking people over by abusing the speed of the vehicles and ignoring the rights of pedestrians.
Still, electric scooters seem to be the little darling of modern urban transportation for the moment, and even the New York Times gave the scooters the thumbs up in a recent editorial. The newspaper offered the electric scooter as one solution to the Big Apple’s ongoing traffic mess and sometimes flawed subway system.
App-based car-hailing services like Uber and Lyft are sensing the growing popularity and planning to launch their own competing scooter businesses.
If anything, a ride on an electric scooter or bicycle offers a fun, healthy way to get around a city, and you can’t beat the rock-bottom price.
Aaron Burdick is a blogger and personal finance enthusiast with slight “addiction” of planning and organizing whether it’s budget, business or just life in general. Finances, real estate, budgeting and new technological solutions are not the only talking points, that he has his heart set on. Passionate about life. he studies and writes about environmental changes, human rights and quality of life. He is also the proud owner of a Golden Retriever. When he’s not writing articles he’s with his best friend playing fetch or cycling around the streets of Louisville.