Micromobility is already disrupting the automobile industry and has started to disrupt transportation and transport and is contributing to the disruption of the America bicycle business.
What Is Micromobility?
It is currently defined as urban transport in sub 500kg (1,102.3 pound) vehicles, that are human-powered, electrically assisted or electrically powered.
2018: The Year of Micromobility
During 2018 the American bicycle business and related industry changed profoundly as the economics of the traditional business were disrupted in part by the larger transportation and mobility sectors as they evolved and focused on Micromobility. According to the National Association of City Transportation Officials (NACTO):
- Micromobility offers some of the best city-based transportation mode options because they are the fastest way across town and can be parked just about anywhere.
Dockless pedal (non-electric) ride share bikes, which rapidly spread like wild-fire across the U.S. in 2016-2017 – have largely disappeared from American cities, with just 3 million trips in a handful of cities in 2018.
Electric bikes emerged as a popular option, accounting in 2018 for 6.5 million trips, 6 million in dockless systems and 500,000 in station-based systems.
What is Shared Micromobility?
According to NACTO Shared Micromobility “…encompasses all shared-use fleets of small, fully or partially human-powered vehicles, such as bikes, e-bikes and e-scooters.” All fit inside the definition of Micromobility that we presented previously.
Uber, Lyft (automotive ride share) and Ford (automotive) have all made recent acquisitions in Shared Micromobility and Bosch (electric bicycle), along with Jump, owned by Uber, Motivate, owned by Lyft, BCycle owned by Trek are all members of the North American Bike Share Association (NABSA).
In 2018, Americans took 36.5 million trips on station-based bike share systems and as we have already referenced, 38.5 million trips on shared e-scooters.
Micromobility services offer a tantalizing solution to address the first mile/last-mile problem and an opportunity to shrink transit deserts (neighborhoods underserviced by public transit services); limited survey data suggests that support for e-scooters tends to be highest among lower-income users.
But Micromobility’ s potential extends well beyond connecting people to mass transit. More than half of the car trips taken annually in the United States cover less than five miles (8 kilometers), making those journeys open to short-range alternative modes such as e-scooters, bicycles and e-bikes.
Micromobility investor and evangelist Oliver Bruce estimates that more than 1.4 trillion miles of annual US passenger travel—and more than 4 trillion miles globally—could be converted to Micromobility modes, an addressable market potentially worth hundreds of billions of dollars.
Micromobility rapidly attracts cash and customers
According to McKinsey, Micromobility has already attracted a strong customer base and has done so roughly two to three times faster than either car sharing or ride hailing. In just a few years, for instance, several Micromobility start-ups have amassed valuations that exceed $1 billion.
Two circumstances have driven this accelerated expansion:
First, most launches of shared Micromobility take place in conducive environments.
Micromobility appears to make people happy—it’s faster than car-based trips in many situations, and users often say the freedom of being in the fresh air traveling to their destinations while avoiding traffic jams puts a smile on their face.
Second, the economics of shared Micromobility are largely favorable to industry participants, generally ensuring lower break-even points.
Companies find it much easier to scale up Micromobility assets (for example, electric bikes) compared with car-based sharing solutions.
How big is the market?
McKinsey modeled the baseline shared Micromobility market and created a forecast, which revealed a 2030 market potential of roughly US$200 billion to US$300 billion in the United States, US$100 billion to US$150 billion in Europe, and US$30 billion to US$50 billion in China.
Growing the shared Micromobility market
While the base case represents a healthy market, the question arises: What is needed to grow the shared Micromobility market into a truly disruptive trillion-dollar business?
For this market potential and mileage cannibalization to become a reality, cities need to support shared Micromobility proactively.
Whether the disruption Micromobility causes matches the hype generated so far will largely depend on how cities react to the service.
While the industry is hoping urban governments view Micromobility favorably as an antidote to congestion and pollution, and a way to provide consumers with an enjoyable alternative to gridlock, cities could instead see it negatively. In fact, some anecdotal evidence of the latter has already surfaced.
So, in addition to building their businesses, Micromobility players will likely have to take proactive roles in lobbying for and shaping the industry in key urban areas.
What about the traditional, mainstream American bicycle business?
Growing Micromobility to its full market potential will also require an increase in the use of individually owned and individual investment in human powered transportation including bicycles, electric assist bicycles, electric scooters and light electric vehicles of all types.
Electric bicycles represent one of the connectors for growth
Electric bicycles represent one of the connectors between the traditional mainstream American bicycle business and the emerging Micromobility ecosystem.
The reason: E-bikes are simply easier and more fun for people to ride. The extra push from a motor makes previously unconquerable hills manageable, and for people with mobility issues, older residents, or those who have not biked in a long time, the assist makes cycling more accessible.
Electric bikes also are effective in closing the distance between the “enthusiast cyclist” commuter set (typically fit, middle-age men who commute in spandex) and people who just want a reliable, efficient and environmentally friendly way to get around their city.
The bottom line – a broad range of people like electric bicycles. Accordingly, they represent potential growth for the American bicycle business.
Bicycling Advocacy – disrupted and improved by Micromobility
For the last decade Federal funding for bicycling has averaged about US$800-US$880 million per year with projects ranging from trails to bicycling paths and designated lanes in cities.
These funding levels were generally considered minimally acceptable by the traditional mainstream American bicycle business trade and advocacy associations – but are being challenged as not being adequate to sustain and grow the Micromobility movement in American cities.
There seems to be agreement among the large consulting firms in McKinsey’s finding that: “…in addition to building their businesses, Micromobility players will likely have to take proactive roles in lobbying for and shaping the industry in key urban areas.”
Accordingly, it also seems obvious that the issues of overall safety, accessibility and connectivity will require the Micromobility providers of the first mile/last-mile solution to become actively involved in bicycling and pedestrian Advocacy relative to cities.
It is both logical and inevitable that the traditional American bicycle business and the new Micromobility ecosystem will come-together to advance their mutual interests under the Micromobility banner and expand the bicycling, electric scooter and pedestrian access, connectivity and safety first-mile/last-mile network throughout American cities and suburbs.
A reminder that America is not Europe
There has been a tendency over the last two decades to look to Europe as the example of what bicycle riding facilities and participation can be in both the short-and-long term future in America.
The conventional wisdom that persists is that electric bicycles, or ebikes will be accepted and adapted by Americans in the same way they have been in Europe, where the category has grown over the last ten years to become the dominant category in the European market.
While we agree that there is little doubt that electric bicycles will be accepted and will grow substantially in the American market, it will take more time and there are and will be different reasons and motivations for market acceptance than has been experienced in Europe, and will be much more dependent on the connections and boost given by Micromobility.
The role of technology
The rapid rise of Micromobility in the U.S. simply would not have been possible or be viable going forward without technology and specifically hand-held phones, cell technology and Apps.
By the beginning of 2019 shared Micromobility technology had expanded to include the latest in docking technology and communication, new dockless technology and Apps, new e-scooter dockless technology and Apps and electric bicycle options for both docking and dockless systems – all with either server based or cloud based data collection and storage and AI analysis.
Ride share bicycles and scooters have driven the rapid development of a range of technology that will continue to evolve, and will have an impact on the development of both smart bicycles and the next generation of componentry for individual bicycles and electric bicycles that will contribute to the growth of Micromobility.
Micromobility in form, function and definition didn’t exist 48-months ago. It may not exist 48-months from now…but it already has – and no matter what it is called in the future – will continue to disrupt the establishment and the traditional channels of trade and advocacy.
Human movement and transportation will continue to evolve and change and will be served in some way, shape or form. Human Powered Solutions will be riding the wave, and whether it is Micromobility or its off-spring or replacement HPS will enjoy, participate, report, analyze, inform and advise its clients and fellow travelers in our community of interest.
Look to The Future!
Note: A Micromobility White Paper is available as a PDF file from this website.