Lime Scooter Economics

B'game hasn't been overrun by rental scooters--yet.  The Wall Street Journal has an article that gives us the economics of the scooter companies and why they are attracting as much venture capital as fast as they are.  Here are the numbers

Many scooters would generate more money if their batteries didn’t run out by midday, he said. Spin has said it had a few hundred scooters in San Francisco before the city started implementing a permit program.  Lime and Bird have told investors they aim to operate millions of scooters, hoping to replace many short trips by car and foot in cities around the world.

The companies tell investors they recoup the cost of the scooters, generally about $350 to $450, after about two months, or faster. The biggest daily costs are maintenance and charging—about $10 to $15 a day per scooter, according to investors who have seen the numbers. The companies pay a force of local residents to charge the scooters in their homes, and some company trucks pick up remaining scooters at night.

“If nothing else, we’ve learned from ride-sharing and home-sharing coming to Nashville, it’s better to be strict on the front end,” said Jeremy Elrod, a member of Nashville’s Metro Council who is pushing for a pilot program that initially limits the number of scooters to 250 for each company. “It’s hard to claw them back,” he said.

Call it a word to the wise.  And with the nuisance factor of the bikes and scooters being left on sidewalks perhaps the business license fee should go up accordingly.

Comments

[Bruce Dickinson]

Folks, let's just say that a few pitch books come across the desk of Dickinson several times a year, given my expanding portfolio of assets. It's interesting to note, for an undisclosed company's pitch book that yours truly has examined, that revenue per scooter ends up being about $20 a day, so with costs of up to $15 a day before depreciating the cost of trucks and batteries that have to be replaced is what one would call "no great shakes".

You're talking about one million dollars of cash flow in a city like San Francisco for 1000+ scooters, even before all the regulations will come clamping down. Cities are going to be putting big limits on these scooters and what happens when you have a bunch of competitors with a commodity product or service? Prices go down.

Bottom line: this bubble needs to POP!

[Ian]

Looks like the bikes are on their way out...

"Lime bikes will soon disappear from cities where the company operated with permission: South San Francisco, Burlingame, San Mateo, Foster City, Sunnyvale, Mountain View, El Cerrito and Alameda. Lime said it will work with those city governments to bring scooters there for the first time."

https://www.sfchronicle.com/business/article/Lime-dropped-the-bike-from-its-name-now-13621057.php

[Account Deleted]

Doesn’t look like we’ll be getting scooters to replace the Lime bikes that are on their way out. See comments under item 10b (starting on page 4) from the minutes of this December city council meeting:

http://burlingameca.granicus.com/DocumentViewer.php?file=burlingameca_5ad5e0d3c11e14b21618d2a13accbec8.pdf&view=1

[Steve K]

Good riddance. I have a few bikes, including a folding bike. I will not be tempted to get on a bike without a helmet.

A little story: I commute via Caltrain to the city. One night last summer I went out with the boys for drinks after work. As they say one thing led to another and I found myself a little too late to get a shuttle to the Caltrain station but quite close to BART, that I hate and try to avoid. So mildly buzzed I took BART to Milbrae, rather than Caltrain to Burlingame. I live near Burlingame ave. It was getting dark but not completely dark. I had tried the non motorized Lime bike a couple times just for fun, which it wasn't since the bikes are heavy and the tires are not real tires. They had just introduced the electric ones and I had the Lime app on my phone so like a cool kid which I'm not - late 60's - I used the app to find one of those electric bikes and hopped on it mildly inebriated.
It was even heavier than the non electric lime bikes but I sort of got used to that in the first few blocks south of the station. And I was cruising along with much less effort and a little faster, which was good since it was starting to get dark.
But at one point I had to execute a tight maneuver as I was crossing a street, and on a normal bike they just turn with a slight lean. But on a bike that maybe weighs 60 or 80 pounds (I have no idea but they are way heavier than a regular bike) they just don't turn easily. I was breaking but I ran directly into a wall. By the time I hit it I was going walking speed but still it knocked me off the bike and I fell backwards off of the bike.
It sort of happened in slow motion and I can remember that I was thinking, I really wish I was wearing a helmet cause this is not good. I did hit my head and it did hear a little whack sound but fortunately I didn't get hurt. Got back up, pride shaken, thankful to be in one piece, and I kept riding, very slowly and got home.
Haven't felt like trying one since.

Did I tell this story before? I can't remember.
Anyway, I say good riddance to those Lime bikes.

[Joe]

Thanks, Steve. That's a great, first-hand view of the problem(s) with the services. I am still very curious how much more poorly these bikes will handle after a couple weeks of heavy rain. If I left my nice bike out for even a couple days it would need a servicing before I felt good about it again.

[Account Deleted]

Thanks for sharing your experience, Steve. I can only imagine how much worse it could’ve potentially been if you were riding an electric scooter. E-scooters seem to be Lime’s and other dockless bike sharing operators newfound focus:
http://newsroom.ucla.edu/releases/fractures-head-injuries-common-e-scooter-collisions?_ga=2.146640052.1882112034.1548697261-362892093.1468948291

[Joe]

Today's DJ is capturing the spirit of the discussion now, but the original post here from 9 months ago foretold this:

Burlingame City Manager Lisa Goldman shared a similar sentiment, nodding to a recent discussion regarding Lime when councilmembers shared a collective disinterest in allowing scooters.

“We are not interested in scooters right now,” said Goldman.

She balanced that perspective though by recognizing the transition which has been creeping across the industry over recent months.

“I’m disappointed but I can’t say I’m surprised,” she said.

Critics frequently cite fears that scooters are more dangerous than bikes, largely because riders frequently will take them on the sidewalk and potentially clash with pedestrians.

Kleinbaum, Goldman and Matsumoto all expressed a desire for identifying another vendor which would offer bike sharing services in their communities.

https://www.smdailyjournal.com/news/local/lime-to-pull-bikes-surprising-san-mateo-south-san-francisco/article_3e391e54-34c9-11e9-b2c2-a7715af6b2c2.html

In the meantime, it looks like the "litter bikes" are already disappearing.

[Joe]

You can always count of EssEff maneuvers and the Comicle's reporting on same for a laugh. Check this out from today's edition:

S.F. bikeshare service raised its rates. Users say it's now the same price as an Uber

The price increase to use Bay Wheels’ fleet of electric bikes marks the latest development in the city’s micromobility saga and comes as the city is exploring whether it should municipalize bikeshares to stabilize costs to riders.

Under Bay Wheels’ pricing changes, which took effect Sept. 23, the per-minute cost to ride e-bikes rose from 15 cents to 20 cents for Bay Wheels members (annual membership: $159), and from 20 cents to 30 cents for non-members. Users are also now charged overage fees on a per-minute basis instead of per-15-minute fees in a move intended to simplify Bay Wheels’ pricing structure, according to Lyft. Rates for Bay Wheels’ less-popular manual bikes remain unchanged.

The city’s budget and legislative analyst is expected to release a study this month examining options for a bikeshare program owned by the city.
----------------
Let me save the analyst some time. You would have to be quite naïve to think that the city of EssEff could provide the service as well and as cheaply as Lyft. The incremental city employees with their salaries and benefits and retirement plans alone would blow the economics out of the water.

[Spurinna]

Big gobmint getting in the way of free enterprise, again
.
PS- Any news on the City Council members’ cost of switching to all electric service in their homes and vacation homes?

[Phinancier]

I read the full article and have to laugh at the lady who is surprised that the e-bike prices are approaching an Uber or Lyft price. Bay Wheels/Lyft has to BUY THE BIKE AND RECHARGE IT EVERY RIDE. The Lyft driver buys his/her car and the gas. Are these people really that stupid?

[Joe]

Here we go again:

Hotel guests at a handful of Burlingame hotels will now be able to rent electric bikes thanks to a new bike share program — marking the re-emergence of app-based rentable bikes on the Peninsula after programs in several cities ended in recent years.

The new program includes at least five bike-share stations, with more potentially on the way. While the new bikes are geared primarily toward hotel guests, they are available also to non-guests, rentable from outdoor docks near the participating hotels.

The new hotel program, run by Unlimited Biking in conjunction with the San Mateo County/Silicon Valley Convention and Visitors Bureau, offers rates of $15 per hour or $75 for the day.

https://www.smdailyjournal.com/news/local/bike-shares-re-emerge-in-burlingame-with-hotel-based-program/article_4898bcc0-784a-11ec-b2cf-8b6d17e33d0c.html?utm_source=smdailyjournal.com&utm_campaign=%2Fnewsletters%2Fheadlines%2F%3F-dc%3D1642518010&utm_medium=email&utm_content=headline

[HMB]

It's going to be great exercise dodging the e-bike tourists when you are trying to enjoy a walk on the Bay Trail.

[Mk]

They litter the streets everywhere you go. The 99% of users are out-of-town visitors on short trips.

Simply visit other cities who have tried them and you can see how useless they are and how kids throw them into the streets.

[Handle Bard]

I agree. And it is time to put up the speed limit sign with the little radar unit telling you your speed. People buzz around at speeds that they could never propel themselves. The city better get in front of this.