4+1 reasons micromobility is here to stay amid coronavirus pandemic
Over the last few weeks, walking down the streets of East London feels stranger to me than ever before. As London recorded almost half of the total number of coronavirus cases in England, London streets are bare, quiet, and surprisingly peaceful. Oddly, London almost feels like a propaganda photo of Pyongyang– empty pavements, silent bypassers, long roads with barely any cars in them, and surprisingly blue sky. The famous lines by The Clash, “London calling to the faraway towns; Now war is declared and battle come down” sound completely different these days.
In the wake of the emerging global COVID-19 pandemic, all transport modes are heavily impacted, whether it’s air, sea or land transport. Micromobility, which includes small >500kg vehicles such as bicycles, scooters and mopeds, is no exception. People’s first priority is staying safe. Working-from-home is the new norm and leisure activities became an unwarranted luxury, eliminating much of the need to travel. Private micromobility companies and the capital markets have already started adjusting to the COVID-19 era, after two of the leading shared micromobility unicorns Bird and Lime announced scaled-down operations and layoffs. This begs the question –will COVID-19 crush the micromobility revolution in its infancy?
COVID-19 impact on micromobility’s key driving forces:
In times of crisis, when uncertainty looms and established truisms collapse, it’s probably best to return to basics and analyse the key drivers of the emerging micromobility sector. What are the key driving forces behind the emergence of bikes, scooters and mopeds, and how they were effected by COVID-19?
1- Range: as this fantastic analysis by Horace Dediu shows, around half of car journeys in the US are less than 15 miles (slightly more than 1 trillion miles), which is arguably the serviceable range of E-bikes, and more than 425 billion miles of car journeys are less than 6 miles’ long, arguably serviceable by E-scooters. In terms of number of trips (rather than distance), the magnitude of short-distance travelling becomes even more prominent. Not only that, but these trips tend to be the more ‘valuable’ ones — the first and last mile, the city center trips, bypassing congested areas — and these trips have even greater value.
2- Cost: put simply, E-scooters and E-bikes are more affordable than any other origin-to-destination mean of transport. Public transport can be more cost efficient at times, but micromobility trumps public transport against the below two factors — speed and experience.
3- Speed: for short journeys, it is nearly impossible to beat micromobility in terms of speed. Sure, scooters and bicycles have reduced maximum speed than other motorised vehicles, but given increased congestion, especially in city centers, micromobility tend to be the faster option. Public transport does not provide end-to-end journeys, and a typical >30-minute home-to-work or home-to-leisure journey can be more quickly served by micromobility. Private hire vehicles and taxis face congestion and waiting times, and private cars require parking, which is rarely readily available.
4- Experience: perhaps above all, micromobility users tend to be passionate about their riding experience. E-scooters and E-bikes provide great user experience, they’re fun to use — and to be seen used — and enjoy great traction and customer retention.
The next question is how the coronavirus pandemic, and its aftermath, will effect these drawing factors. Fundamentally, there will be limited relative effect on micromobility, beyond macro changes.
Granted, our economy and markets are likely to change, at least during the next 12–18 months until vaccination will be readily available. People will travel less to work and leisure, significant parts of our population — the elderly and those with underlying health conditions — might avoid travelling altogether, and VC funding will be harder to get hold of. But I would argue that beyond these important changes, the drawing factors of micromobility are here to remain (if anything, the cost element will become more important in times of economic downturn).
COVID-19 impact on our commuting patterns:
We should remember that COVID-19 will alter our lives and economy, and these changes in behaviours and preferences will effect us both in the short and the medium-long term.
In the short term, we see immediate responses from the public, micromobility operators, and cities. Perhaps surprisingly and against the backdrop of a temporary halt in transport ridership, some cities such as New York City and Washington D.C. actually report a surge in bikeshare ridership in the last few days, as micromobility is seen as a plausible alternative to reduced public transport services, and as a more hygiene-friendly option than for-hire taxis. Although some operators scaled down their operations to ensure public safety (stated motivation) and avoid burning additional cash (implicit motivation), others see this as an opportunity to expand their services using additional safety measures. For example, operators offer free rides to health workers, and regularly disinfect their fleets and even attach hand sanitizer gels to scooters. The need to disinfect shared micromobility vehicles is likely to stay with us, and it will be interesting to see what will be the operational solutions and implications on the already low-margins operations. Lastly, some cities also take the opportunity where traffic flow is reduced to change the approach towards micromobility. Most notably, Bogota introduced +100km of ‘temporary’ cycleways to enable essential journeys. To summarise, although it is still too early to evaluate the overall immediate effect on micromobiltiy ridership, the industry is not expected to grind to a halt in the coming weeks and months.
COVID-19 also introduced a new concept to our lives that is likely stay with us in the medium-long term — physical distancing. In a world where some forms of physical separation are advisable, micromobility, as a personal mobility option, will become a more preferable transport mode for many. Sure, it might urge a move from shared ownership and bike-sharing schemes to personal ownership, and some providers were already quick to change their pricing model and offer daily rental to reflect that. Nonetheless, micromobility’s inherent physical isolation will support user uptake in the next few months and years.
A positive prediction (for gloomy days)
Overall, the future looks a bit cloudy in the short term, but in the medium-long run, the post-coronavirus world will shine a bright light for micromobility. It should not surprise us that investors and VCs look for safer options these days, but my guess is that micromobility will be the first form of transport to recover, and the one that will benefit the most from this COVID-19 crisis. Being a smaller, leaner and easily deployable form of transport will benefit micromobility once again; on top of this, being a truly private mode of transport will be a crucial selling point going forward.
Thoughts and comments are welcomed.
