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[London 14th Reuters BREAKINGVIEWS]- Electric stand-up skates are no longer play equipment for children. It became an indispensable part of urban transportation during the Crown era. An increasing number of cities are allowing the use of electric scooters on public roads. As a result, European start-ups in the shared electric skate business are regaining their vitality.
There was already a service whereby anyone with a smartphone could rent an electric board for short-distance trips, but it suffered from high operating costs, security concerns, and fierce competition. It was Corona’s wickedness and dating restrictions that struck there. In March of last year, the American operator Bird laid off a third of its employees. In May, competition Lime accepted a 79% reduction in corporate valuation and applied for funding from ride-sharing services giant Uber Technologies, according to The Information.
However, since then, as the behavior of taking social distance on the go has become widespread, many city residents have sought an alternative to public transportation and have tried electric scooters. While major cities such as London, New York and Paris have legalized electric scooters on public roads, they have introduced a system to limit the number of people sharing electric scooters through a licensing system.
Swedish startup Boy Technology has so far gained approval from about two-thirds of European cities. According to the company, the number of use in September-November last year increased 85% year-on-year. McKinsey predicts that even after the Corona disaster has subsided, the world’s electric float table sharing will continue to exceed the pre-Corona level by 12%.
While demand has increased, costs have been reduced. The biggest operating costs are repairs, adjustments, recharging, and relocating the board. Boy and Lime, as well as Berlin-based Tier Mobility, have developed replaceable batteries that cut maintenance and relocation costs in half.
As a result, the business becomes profitable. Users are generally charged between $ 0.1 and 0.2 per minute after paying $ 1 to unlock a borrowed support table. If you calculate the income for each car, you can get up to almost $ 20 if you use it three times a day for 30 minutes. In this scenario, assuming the cost is half of the revenue, if the purchase price of an electric skateboard is $ 500, the operator can recoup it in less than two months.
Boy and Tia sank last June. In November, Tia raised $ 250 million from a group of investors, led by Softbank Group, with a corporate valuation of approximately $ 1 billion. Lime’s EBITDA (earnings before interest, before taxes and before depreciation) entered black numbers in the June-September quarter.
However, the use of electric skateboards will decrease in winter, so this business is still a seasonal business. In some cities, the daily income is much lower than the previous estimate. Furthermore, as the number of users increases, concerns about traffic safety will increase and regulatory authorities may revoke the approval. With that said, there’s no question that shared electric skateboard operators are on the way now.
● Background news
* Lime announced on November 19 of last year that EBITDA (earnings before interest, before taxes, before depreciation) entered black numbers in the third quarter (June-September). At the same time, he showed a new model of electric skateboard.
* The London Transport Office announced on November 17 that it will begin a public road test of electric scooters in early 2021 and will select up to three companies to participate.
* The Softbank Group announced on November 11 that its “Vision Fund” led in funding of $ 250 million by Tier Mobility. The following day, Estonian private transport company Bolt announced plans to invest $ 118 million in this sector in preparation for a plan to roll out 130,000 electric scooters and bicycles in 100 European cities in 2009.
* Tia told Breakingviews that it was profitable in the third quarter of last year (April-June).
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