E-SCOOTER SHARING MARKET
COVID IMPACT ON E-SCOOTER SHARING MARKET
- The general trend due to COVID is an increased ride duration per trip across USA and Europe
- The utilization factor of scooters have also improved but the scooters deployed in the cities were much lesser than pre-COVID
- Due to the new understanding of the utilization factor in fleets, operators will have an improved idea on deployment of scooters
- During COVID,~93% of the new riders were converted to regular rider i.e more than 4 rides per week which is a greater conversion than pre-COVID times
- Due to the increased demand for sustainable transport, many cities are promoting e-scooters such as Bordeaux and Rome. The resumption to normal activities post-COVID also saw a focus on sustainable transportation in terms of monetary help provided by government and policies implemented by city officials
- Generally micro mobility is utilized as a bridge between public transport and destination. As customers are preferring to increase trip duration on scooters, operators can utilize this opportunity to improve revenues as customers decrease reliance on public transport mainly for 3-6 mile trip length. The advantage for the customer is decreased waiting time and faster trips
- Countries such as Germany etc. have set up special lanes for bicycles, e scooters etc. which will see improved usage. Also due to social distancing factors in place across countries e scooters will be preferred over public transport and the trend will stay as customers get acquainted with this facility.
- There will be an increase in the usage of e-scooters from March 2021 onwards as USA and various other countries across Europe are completely opening after successful vaccination drives
- The expansion of various operators into cities will not be like the boom in 2019 mainly due to profitability as well as regulations passed by various states in terms of fleet size and permission to operate
- Operators will soon look to leave cities were there aren’t profits as they are mainly running on investment capital which cannot hold longer losses
KEY FINDINGS-PRE COVID( MARCH 2020)
- As of March 2020, E-scooter sharing services were available in 177 US and European cities, down from 223 cities in Dec 2019
- In US, 38 out of 80 cities (~48%) which had e-scooter sharing as of March 2020, belonged to just 6 states i.e. California, Texas, Florida, Virginia, Arizona and North Carolina.
- Due to higher upfront licensing costs per scooter and reduction in the max fleet size allowed per operator in many cities, e-scooter sharing operators have stopped expansion and started scaling down their fleet size in many US cities
- Lime- the global market leader in E-scooter sharing has significantly scaled down its US presence in past 3 months i.e. from 90 cities in Dec 2019, to 54 cities in March 2020
- About 20-22% of the e-scooter sharing activity in US is centred in and around California, reason being high population density ,tech savvy population, declining car ownership and zero emission policies
- In micro-mobility market, Bike sharing start-ups got more than 90% of total funding till H1-2018 ,but between H1-2018 to 2019 scooter sharing operators became the top choice for investors
- In the second half of 2019, the e-scooter sharing frenzy has shifted from US to Europe and e-scooter sharing services were available in 112 cities(Nov 2019) as compared to just 32 in March 2019 but reduced to 97 cities in March 2020.
- As of March 2020, Madrid, Paris and Berlin are the top 3 European cities in terms of E-scooter sharing fleet size and utilization
- Tier has the widest coverage pan-Europe in 54 cities. It added 16 cities in Dec 2019-March 2020 period. In the same period, Lime shut down its operations in 21 European cities and is now present only in 35 European cities.
POST COVID FINDINGS (JUNE 2021)
- Countries such as UK who previously deemed it illegal for e-scooter are now running test trials and giving out permits on a city basis
- Firms are also launching mopeds and bicycles for various users
- Swappable batteries is the ongoing trend in terms of e-scooter recharging
- Firms have invested in R&D and are launching their own vehicles rather than purchasing from a third party vendor. The vehicles developed are also available for personal usage
- The pricing strategy won’t be as cheap as 2019 rates, mainly due to decreasing competition on a city basis and profit margins
E-scooter sharing- Why do we call it sharing and why not rental? The answer is, it is another extension of the fast growing” shared economy”. A rental typically happens for a minimum hour/day/week, whereas sharing happens only for a trip.
If 2017 was the year of bike-sharing gaining popularity, the same can be said for 2018-H1 2019 . The year 2018 saw many ride- hailing, bike sharing operators and many new European startups foraying in the scooter sharing market and the decline of the bike sharing market. To know more about both bike and scooter sharing market, read our Global Micro Mobility market report
DIFFERENCE BETWEEN BIKE SHARING AND SCOOTER SHARING
The biggest growth driver for E-scooters is the blistering growth of the on-demand economy, highly congested and polluted urban cities and its low physical footprint with zero carbon footprint. They also have an advantage over on-demand taxi and bike sharing, owing to low cost and shorter trip duration.
But, not everything`is right for E-scooter sharing operators. Many city planning authorities are concerned about the safety of riders and pedestrians. Sidewalk clutter is being sorted in many cities by creating specific drop-off zones but it is still far from over.
Aggressive funding by VCs resulted in solid expansion across geographies in 2018-H1 2019 but the very short lifespan of scooters were and still are a major threat to profitability. Post H1-2019, there has been a rationalization of operators`s expansion plans as investors look for a concrete path to profitability.
E-scooters have created polarized opinions in our society. Although they are good for our urban, polluted cities, they still require sustainable charging infrastructure and separate pathways, which is rare to find.
Various issues of riding on footpath, accidents, riding without helmet, pedestrian safety as well as death to multiple riders etc. caused municipalities and cities to impose restrictions across the board as well as guidelines so as to provide a service for the residents but also ensure their safety.
MARKET SIZE AND FORECAST
To succeed in an on-demand economy, density is the key. All on-demand mobility providers started from upscale, dense cities, and the same can be said about e-scooter sharing operators.
There are more than 150,000 scooters in 177 cities cumulatively in the US and Europe available for sharing. The standard rental charges in the US are $1 for unlocking and 15 cents per minute. The cost of a 1-1.5 mile trip could be in the range of $2.5-$3.5, which is almost double that of bike sharing. Please refer to our Bike sharing Market in US and Europe report to know more about bike sharing.
The electric scooter sharing market in US and Europe is estimated at $480 Million in 2021, growing at 15% CAGR till 2026.
In the US, E-scooter sharing services were aimed at giving a tough fight to the king of transit- cars. But, after analyzing the e-scooter sharing services for more than 18 months, we can safely conclude as of March 2020 that they had very limited effect on car sales as well as miles traveled in the US. In fact, the e-scooter sharing operators have tapped more of the car-less population who either walk/take a bus/ take a taxi/ share a ride to go to their destination.
US has a car penetration of 800 per 1000 inhabitants and more than 30% households have multiple cars. Now, in a country with a per capita income of $50,000, the majority of the population can certainly buy an e-scooter instead of renting it.
So, what is the value add of these e-scooter sharing companies? In one word “convenience”. Buying a scooter, will mean carrying it to your destination and recharging it, as and when the battery is low. And, this is where sharing comes in handy. A 2-mile trip will cost ~$3 and the user can drop it anywhere, now that is a big plus. No worrying about parking, recharging and maintenance, just use and pay per trip.
The growth of the e-scooter sharing market value will clearly depend on three major factors: a) expansion in number of cities b) increase in number of scooters per city c) increase in number of rides per scooter per day. Especially now that many American cities have a cap on the total number of scooters that could be deployed in a city, “unit economics” is more important than ever.
City users also utilise e-scooters to travel from public transport to various utility areas such as office and shopping centres without breaking a sweat. The wait times are lower and since the trips are short, its much faster than a cab or walking
As of June 2021, Paris and Berlin appear to be the hub of e-scooter sharing in Europe,followed by Madrid and Stockholm.
E-scooter sharing in Europe is now only available in 97 cities as compared to 112 cities in Dec 2019.Europe`s e-scooter sharing market comprises a larger number of European players, but with smaller fleet sizes. US based Lime and Bird are present in 63 unique cities as compared to just 22 in March 2019.As per Lime, Paris residents travel on an average 6 miles per trip, generating the highest revenue per ride globally.
Germany legalized the use of e-scooters on roads and bicycle paths in May 2019, leading to a battle among European and U.S. startups to roll out sharing services in Europe’s biggest economy. Berlin based Tier is among the biggest players in Europe and has recently announced that it will also offer E-smart scooter sharing services. It is now present in 54 cities, significantly higher than both Bird and Lime.
Post Covid, there are multiple players in the market who are fighting for permits across important cities such as Paris, Rome, London, Berlin etc where operations will also increase the brand power of the firms. Various new features such as app less riding and also the introduction of Mopeds are present in this region
The scooter sharing market size in US and Europe is 15-20X bigger than Asia. To know more about Asian market, read our report titled Scooter sharing Market in Asia
FUNDING RAISED BY BIKE AND SCOOTER SHARING STARTUPS TILL JUNE-2021
More than 30 bike and scooter sharing startups have cumulatively raised ~$8.5 Billion between 2016 and June 2021. Bike sharing startups raised ~$5.5 Billion whereas the remaining $3 Billion has been raised by various scooter sharing startups between 2015-June 2021.
NEW E- SCOOTERS DEVELOPED FOR SHARING
|Manufacturer/operator||Changes in new scooter||Biggest area of improvement|
|Lime||Increased wheel size from older model to 10” now, 20% more efficient and smarter||A new LED display which shows riders when they enter sidewalks, no parking zone and improperly park the scooters|
|Skip||615Wh swappable battery along with internal sensors||Based on a modular structure the lifecycle is now increased and has airless tires|
|WHEELS||All new product||The seated design gives riders a lower center of gravity, which can help them to feel more stable due to largest, 14” diameter wheels|
|Segway- Ninebot||AI driven scooter with remote control feature using cloud technology.||Uses ultrasonic sensor and camera to self-drive, can also self-drive to a docking station is among the most advanced scooters developed in recent times |
The sharing economy start-ups are mostly fueled by VC(venture capital) money, as we have elaborated in our Bike and Scooter sharing startups report. Their first target is always acquiring new customers(gaining scale), by putting more capital,keeping profitability aside. Bird and Lime have accumulated funding to the tune of $1.48 Billion by Nov`19.Bird is now valued at ~$2 Billion and is the first start-up to get there in less than a year into starting its operation.
In the US, the competitive landscape is extremely consolidated where Bird and Lime account for a major chunk of the market. Europe on the other hand is a comparatively fragmented market with local players like Tier,VOI and DOTT giving a tough fight to the American duo- Lime and Bird.
The first leg of the e-scooter sharing race among startups was all about gaining scale but 2020 onward it will be all about cutting costs, burning less capital and achieving profitability. There have been significant internal clampdowns by all operators in terms of their presence and cash outflow and even laying off employees.
Covid saw increased losses across the board which led to layoffs as well as multiple operators leaving the market. There was also a hold on expansion across Europe and USA as well as withdrawal from various markets.
Among smart scooter(moped) sharing operators, Paris based City scoot raised ~$26 Million in Feb 2020 to expand in two more European cities and take its fleet size to 8,000 scooters. Uber integrated its offerings with City scoot scooters in Paris from October 2019.
In 2019 and 2020, 3 firms closed, 4 firms were acquired and 2 firms merged with bigger players. This will lead to investors looking out for profitability in firms before the urge of expansion among various players. New entrants in the markets will also target localisation, mainly increased services in a single country before expanding to other countries.
THIS REPORT WILL ANSWER FOLLOWING QUESTIONS
- The market size (both volume-rides and value-$Million) of e scooter sharing market in 2019-2024 and every year in between?
- Market segmented by scooter type (electric kick scooter and smart scooter) and Geography (US and Europe)
- E-scooter sharing users profile
- Detail on E-scooters used in sharing services and fleet breakup by major cities in US and Europe
- Funding raised by E-scooter sharing start-ups, segmented by stage
- The impact of E-scooter sharing on e-scooter manufacturing industry
- Role of block chain and capital in e-scooter sharing services expansion
- Market share of e-scooter sharing companies in US and Europe respectively
- Can e-scooter sharing displace car-pooling and car sharing, if yes then to which extent
- Legislations in cities detailing cap on maximum fleet size
- Average revenue per ride per day in US and Europe
- Impact of investment by tech giants like Google in Lime on scooter sharing market
- How e-scooter sharing will disrupt /displace bike sharing
- Which 3 European cities will account for >50% of E-scooter sharing market?
- Why kick scooters have an edge over smart scooters?
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