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Uber Is Going to Make Electric Scooters Profitable

Ride-hailing giant Uber is now joining the rivalry of electric scooter sharing and they are determined to make the business profitable [1].

Uber is planning to surprise the market with custom electric scooters at the end of this year. Uber’s head of scooters, Michael Beckman, said that the company has a strong faith in both electric bikes and scooters being the main way of transport in cities. Uber is hoping to work with electric scooters that are more “comfortable, durable, and more difficult to vandalize”. Uber did not disclose when exactly the new scooters would go public.

Unlike other smaller entrepreneurs, ride-hailing giants such as Uber have much deeper pockets since they have been in the mobility market for a longer time. In June last year, Uber started its “NeMo” team with 2 000 employees dedicated to working on Jump’s bike sharing operation, Uber’s own scooters, mobility incubators and the connection with public transport – UberTransit. However, considering the financial challenges that other scooter rivals such as Lyft and Bird have been experienced, Uber’s ambition to make the electric scooter business profitable will not be frictionless. Even so, the market still has a strong belief in electric scooter sharing as a viable growing business.

 

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Uber is hoping to customize a more “rigid” scooter model to survive the tough use phase, similar to the strategy taken by Bird with its Bird Zero [2]. Others are trying to incentivize users to treat the scooters nicer. Lime tries to encourage parking in preferred areas, and Lyft has now started to incentivize parking close to public transit with a deducted fair. Users can save $1 by parking the scooter in the transit zones [3]. This is a good strategy for the company to regulate parking and keep their fleets in safe zones where the scooters are less prone to being damaged.

Micromobility actors are now being more creative to come up with solutions to prolong the lifetime of the vehicles and encourage good user behaviour. A combination of those methods can hopefully bring light to the scooter sharing business.

 

Written by Anne Faxér, RISE Viktoria.

 

Sources

1. 2019-03-14. Uber Plans to Roll Ahead of Competition with Custom Electric Scooters.

2. 2018-10-04. Bird Unveils Custom Electric Scooters and Delivery.

3. 2019-03-14. https://twitter.com/npope32/status/1106311432168067072