What is Micromobility’s Path Towards Profitability?

  1. Battery charging
  2. Location
  3. City regulations

Hardware: Vehicle and Telematics

Unsurprisingly, scooter sharing operators on the panel vouched for the importance of a sturdy form factor that can be used and shared over and over again. In the early days of scooter sharing, kick scooters that were built for personal use were put in shared fleets. This resulted in a short life span and unreliability of scooters as a sharing vehicle option. However, a range of solid, purpose-built scooters for sharing are now available and dominate fleets. For operators, this means they can minimize fleet turnover by reducing downtime and maintenance needs, maximize utilization during the scooter’s lifetime, and ultimately reduce overhead costs of purchasing new scooters.

Charging Needs and Swappable Batteries

When it comes to electric micromobility vehicles, batteries make up 30% of the asset costs. The cost factor puts extra focus on battery charging and maintenance operations in order to ensure a prolonged battery lifespan.

Location

Dense, urban cities are the go-to launch pad for all forms of shared mobility. But as cities are capping the number of scooters permitted in cities and as equitable access to new mobility is being questioned, the next question becomes: is it possible to achieve profitability in less dense, and smaller cities? On a high level, people in small cities need to get around just like people in large cities. The difference lies in the density and whether shared micromobility can thrive in those environments.

City Cooperation

While winning a permit or RFP is key to launching a shared mobility business; maintaining a strong working relationship with the city is arguably even more important — as cities are essentially a customer of micromobility operations. From the city’s point of view, their focus is on safety, sustainability, and reliability. They are looking for micromobility operators to make mobility further accessible and greener for citizens, by complementing the already existing public transportation infrastructure via seamless integration. As the micromobility space is developing, cities are beginning to realize what they want out of these new services and start to shape their tenders to ensure operators can meet their needs. Operators can leverage their telematics’ built-in I/O extenders and sensors to provide additional data like air quality or road conditions to further benefit cities, which can assist towards building healthier communities.

Takeaway: Stay Flexible and Constantly Optimize

As the pandemic has shown, the mobility landscape can change rapidly, as can user requirements. Also, cities are constantly evolving. Operators need to ask themselves how they are addressing a changing landscape and what will be the profitable business model at a given time. This will likely mean looking at operations from a customer-centric point of view instead of a vehicle-centric point of view. While it may make sense to diversify the service offered, that results in operational complexity. Even within the panel, there were different opinions on how to stay nimble to change. Micromobility is still in its early days, and this is the time to experiment and learn from trial and error. From multi-modal solutions to leveraging software capabilities to cooperating with cities, operators need to find their strengths and grow in that direction. There is no one big answer that will make or break operators, it is a matter of many small and constant improvements.

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