Lime, Bolt, Bird, Dott.. No matter the city, e-ride sharing stands are almost impossible to miss on the sidewalks of Europe’s streets. The popularity of e-scooters and e-bikes has not dwindled despite regulatory bumps and public safety concerns that have animated debates over the future of micro-mobility. As COVID and environmental concerns further push the public away from conventional forms of transport it remains to be seen whether 2022 will be the year where e-riders displace the car in short-distance travel. While a total transformation of the urban transport landscape is unlikely, current trends point to favourable changes that will see the micro-mobility market flourish as it becomes more mature and refined.
Why now?
The market in 2018, particularly for e-scooters, became very hot very quickly, with institutional investors valuing companies such as Lime at over $1bn. Since then the market has cooled partly due to regulators catching up on the ‘scooter mania’ and partly due to the emergence of a congested e-ride market. An increase in accidents with pedestrians and concerns over rider safety, led many governments to introduce speed limits and place restrictions on the type of roads riders can access. While legislation is not yet complete, tighter restrictions have been a blessing in disguise for some. In Paris, Europe’s biggest micro-mobility market, mandatory licences have enabled a select few to cement their position in the market and get rid of less compliant newcomers. This has led to the creation of higher standards and market consolidation.
COVID was bumpy for startups as lockdowns kept people indoors. Nevertheless market expectations rebounded strongly with e-bike sales soaring 240% in 2021. The overall stealth of the micro-mobility market is further reflected in a series of big moves by established players. Just a few months ago, Swedish startup Voi, raised $115m in series D in preparation for a future IPO, following the earlier listing of Bird. A number of acquisitions have also occurred such as Lime’s acquisition of Uber’s Jump; and Tier’s acquisition of Nextbike which aims at creating a ‘pioneering’ multimodal micro-mobility platform.
A second striking development leading up to 2022, has been the normalization of micro-mobility solutions. In 2018 e-riders were still new to the public and were quite basic in their offering. Since then, the product has become more refined, adapting to different consumer segments and addressing commuter needs better. An example evidencing this is Dutch-based seed company Cargoroo. Cargoroo is an affordable e-cargo bike sharing solution that has targeted urban families with children. One advantage that it has over ordinary e-bikes is that it gives users transfer capacity and is family-centric. Solutions like Cargoroo show that contrary to a one-for-all approach there are specific niches that can be exploited in a market that is becoming more defined. This is of course not just evident across product diversification but also in the additional services being offered to e-rides. Advanced AI-powered rider support, enhanced map integration and even smart helmet metaverse-inspired discussions seem to point the way forward for a tremendously innovative market that aspires to be part of a ‘new’ urban normal.
Thirdly, additional regulatory pressures and smart-city goals are conducive to the development of the micro-mobility market. Cities in Europe are under a lot of stress to reduce their environmental footprints in light of 2030 carbon targets. In their attempt to phase out fuel-burning cars, many are turning to e-riders to completely reconfigure what city mobility looks like. These efforts are further aided by transnational programs such as the EU-sponsored ‘eHUBS’ which aims to promote the growth of ‘smart, shared and green mobility’ in favour of electric mobility services. While e-bike and e-scooters have a carbon footprint of their own, they represent a significant sustainable alternative to traditional fossil vehicles. Moreover, micro-mobility is more developed as a market than electric cars, more affordable and energy-efficient making them a superior choice for city regulators.
Finally, in the wider ambition of cities to transition into a digitized and ‘smart’ future, e-scooters and e-bikes can easily integrate into transport networks to help boost such a shift. Already, it is easy to imagine how discussions over the safety, space usage and data sharing of these new vehicles can be extended to address the city mobility ecosystem as a whole. Moreover, within GDPR constraints, data insights from e-rider companies can be used to develop urban intermodality and identify gaps in infrastructure design so that transport services are better linked and city networks are optimized. It is therefore in the interest of urban planners to create conditions that will allow micro-mobility to flourish.
Future prospects
The micro-mobility market in Europe has not reached its peak. As a matter of fact it has only just exited a chaotic first phase to become better-defined. Together with regulatory changes, competitive pressures and innovation trends, micro-mobility seems well positioned to achieve important breakthroughs this year. Estimated to reach $100 billion to $150 billion in 2030, the second largest market behind the USA, there is much room for growth. 2022 will be an exciting year for e-riders, startups and cities leaving only little speculation on whether it will be transformational or not.
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