If electric scooters want to survive, they need to strengthen management


In September 2017, a company called Bird Rides launched hundreds of electric scooters on the streets of Santa Monica, California, starting the trend of sharing electric skateboards in the United States. After 14 months, people began to destroy these scooters and throw them into the lake, and investors began to lose interest.

The explosive growth of dockless scooters and their controversial reputation is an unexpected traffic story this year. The market value of Bird and its main competitor Lime is estimated to be around $2 billion, and their popularity has allowed more than 30 motorcycle startups to operate in 150 markets around the world. However, according to reports from the Wall Street Journal and the Information, as the second year enters, as business operating costs become higher and higher, investors are losing interest.

As motorcycle companies find it difficult to update models on the street, vandalism and depreciation costs are also having an impact. This is information in October, and although these figures may be a bit outdated, they indicate that these companies are striving to make a profit.

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Bird said that in the first week of May, the company provided 170,000 rides a week. During this period, the company owned approximately 10,500 electric scooters, each used 5 times a day. The company said that each electric scooter can bring in $3.65 in revenue. At the same time, Bird’s charge for each vehicle trip is 1.72 US dollars, and the average maintenance cost per vehicle is 0.51 US dollars. This does not include credit card fees, license fees, insurance, customer support, and other expenses. Therefore, in May of this year, Bird’s weekly revenue was approximately US$602,500, which was offset by a maintenance cost of US$86,700. This means that Bird’s profit per ride is $0.70 and the gross profit margin is 19%.

These repair costs may rise, especially considering the recent news about battery fires. Last October, after several fires, Lime recalled 2,000 scooters, less than 1% of its total fleet. The startup blamed Ninebot, which produces most of the electric motorcycles used in shared services in the United States. Ninebot severed its relationship with Lime. However, these repair costs do not take into account the costs associated with sabotage. Encouraged by social media, anti-scooters knocked them down on the street, threw them out of the garage, even poured oil on them and set them alight. According to reports, in October alone, the city of Oakland had to salvage 60 electric motorcycles from Lake Merritt. Environmentalists call this a crisis.