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Electric Scooters: Sales opportunities in the rental boom?



LAS VEGAS – Electric scooters captured the imagination of urban investors and planners last year with companies such as Bird Rides and Lime that offer rentals of application-based e-scooters in several large cities. Now the business model of renting e-scooters faces some serious doubts.




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The e-scooters manufacturers at CES 2019 say that the best market opportunity for these short-range transport systems could be the sale of the devices to urban dwellers and those who travel daily. After all, electric scooters are small and light enough to carry trains and buses. Many models are folded for easy transport and storage.

"We like to say: 'The rent is for newbies,'" said Jason Wakefield, marketing director of Swagtron. The company based in South Bend, Indiana, sells electrical products, from hoverboards to e-scooters and e-bikes.

Frequent tenants of e-scooters would be better off buying theirs, he said.

"You're seeing 30 or 45 days (of scooter rental) and you could pay for a scooter, a $ 200 scooter," Wakefield said. E-scooters usually vary in price from $ 199 to $ 499.

Rented electric scooters not always reliable

If you are renting scooters, you can not count on having a scooter when you need it and that it is sufficiently loaded, he said.

The target market for e-scooters and portable electric bicycles are travelers looking for a way to accelerate their last mile to go home or work. Students on college campuses are another big market, Wakefield said.

Swagtron sells its devices online and through retailers like Best Buy (ABY) and Walmart (WMT)

"We want to be the No. 1 producer of electrical products in general as a last mile transportation solution," Wakefield said.

E-Scooter Rentals best suited for tourists

Electronic scooter rental services are probably best suited for areas with many tourists, he said.

Lime was at CES 2019 showing his Lime 3.0 electric scooter. The latest rental e-scooter has a navigation screen, better battery life and longer range. It also has built-in GPS, multimodal braking, double suspension and larger wheels. In addition, it gives alerts to users who do not park the devices correctly.

Rental of scooters that dirty the sidewalks has been a big complaint against them. The Wall Street Journal reported that other problems with the business include increased competition, hardware failures and vandalism.

Spokesman Jack Song told Investor & s Business Daily that Lime is serving multiple markets. They include travelers, urban explorers and tourists. Its rideables are available in 100 cities and 15 countries.

Other e-scooter manufacturers at CES 2019 include Razor USA and Segway-Ninebot. The four-day annual consumer technology show ended Friday.

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