Electric Scooters Are Remaking Mass Transit While Driving Profits for Service Providers

Blazing new paths for commuters and challenging cities' infrastructure

Cities are taking steps to adapt to the scooter craze. Photo Illustration: Dianna McDougall; Source: Getty Images
Headshot of Ann-Marie Alcántara

If you’ve been to a major American city in the past year, you’ve noticed it: sidewalks strewn with discarded pay-per-use electric scooters. Riders seemingly drop them to the ground as soon as they’re done with them, no matter where they are. It’s kind of like a parade of visitors coming to your house and throwing their jackets on the floor wherever they please, multiplied many times over: It’s a mess, someone’s bound to trip and it feels chaotic.   

It makes you wonder: Who’s riding these things anyway, and why are they so popular?

First of all, you’re not wrong about the ubiquity of e-scooters. Companies that provide rentable e-scooters have reported millions of rides across the country since the pay-per-use vehicles were introduced in March 2018 by companies like Bird, Lime and Spin in San Francisco. Bird, for example, has notched more than 10 million rides since September 2017. And ride-sharing services Uber and Lyft, sensing an opportunity, have also joined the e-scooter craze. Lyft—which finalized its acquisition of Motivate, the country’s largest bike-share provider, with footprints including Citi Bike in New York and Ford GoBike in San Francisco—is in nine cities with its scooter program. It reported more than 200,000 scooter rides since September.

Uber operates two separate scooter programs: one in conjunction with Jump e-bikes, the company the ride-share behemoth bought in early 2018, and Uber-branded scooters with Lime. Its programs have tallied more than 4.1 million miles of use. Also in the overall e-scooter mix: Scoot, which rents electric, Vespa-style vehicles and scooters in three cities, and Spin, which operates in 10 cities and five college campuses across the U.S.

Regardless of which company you choose, most scooters cost just $1 to unlock and are then 15 cents per minute after that, with an average ride costing about $5 for what amounts to door-to-door service when you consider that you don’t have to return the scooter to a designated docking station, as with bike shares. (E-scooters are tracked via GPS, so the next rider simply uses their mobile device to find one nearby, scans it and is on their way.) In cities like San Francisco and New York, where population growth has overwhelmed the transportation system—think rush-hour traffic jams and mass-transit delays and breakdowns—scooters are a swift, easy and inexpensive alternative.

“The biggest challenge for cities in particular is the pace of change,” says Andrew Glass Hastings, senior mobility strategist at Remix, a planning platform for cities. “There has been more change in urban transportation in the last 12 months than there has been in the last 12 years. It’s not the city’s fault—it’s just the bureaucracy wasn’t set up to be able to respond in a flexible enough and quick enough way to the pace of change we’re seeing today.”

Some cities have protected bike lanes for scooters.

Culturally, scooters also have a perceived lower barrier to entry—you can scoot no matter who you are or what you wear, even in a suit or dress. “Scooters have no associations with them,” says Arielle Fleisher, senior transportation policy associate at the San Francisco Bay Area Planning and Urban Research Association (SPUR), “so they’ve been able to capture the hearts of a wide variety of people in that respect.”

They’ve also proved to be profitable. Bird is valued at more than $2 billion, and there’s speculation that Uber may buy it. Lime is valued at $1.1 billion, which includes a $335 million investment from Uber and Alphabet’s Google Ventures. And Spin, the only company acquired so far, was bought by Ford for a rumored $100 million. 

And while there are signs the investment rounds are slowing down, these companies are still poised to grow. The e-scooter phenomenon has already reached Oakland, Calif.; Washington, D.C.; Austin, Texas; Seattle; and Nashville, Tenn. And Spin and Skip are set to enter the Los Angeles market soon. Spin wants to be in 100 markets by the end of 2019, and companies like Bird are courting New York. To gain an edge, some of these companies are offering low-cost pricing or enabling cash payments as part of a deal to enter cities like San Francisco.

But as e-scooters have surged in popularity, there have been many bumps along the way, literally and figuratively. Trauma centers across the country have seen an uptick in scooter injuries, ranging from scraped hands to broken bones. The Centers for Disease Control and Prevention is currently conducting a study on the safety of scooters, using Austin as its model. And last March, when Bird, Lime and Spin brought their scooters to San Francisco—and, in the case of Bird and Lime, Oakland—some residents were so angry about scooter-cluttered sidewalks that they clipped the scooters’ brakes or simply threw them in the garbage (or in Oakland’s Lake Merritt). 

For its part, Lime is combating the perception that scooters are unsafe or a nuisance with its “Respect the Ride” campaign, which asks people to ride safely. The company has also promised to distribute 250,000 free helmets to riders in all the countries in which it operates. Lime has so far shipped more than 50,000, a number Bird has matched with its own helmet initiative.

Cities are also taking steps to adapt to the scooter phenomenon. Fleisher says some have created protected bike lanes or “red carpets” designated as bus-only lanes. San Francisco established 10 guiding principles toward “emerging mobility,” and New York launched a “Vision Zero” public safety campaign, which aims to bring the number of people killed or injured by traffic to zero. Some cities, including San Francisco, are also exploring ways to eliminate the sidewalk clutter caused by discarded scooters, such as mandating that scooters have a locking mechanism so they can be secured to a bike rack.

This story first appeared in the Jan. 7, 2019, issue of Adweek magazine. Click here to subscribe.

@itstheannmarie annmarie.alcantara@adweek.com Ann-Marie Alcántara is a tech reporter for Adweek, focusing on direct-to-consumer brands and ecommerce.
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