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Wounded, Not Dead: Micro-Mobility Struggles in Uncertain Times

Venture capitalists say they're still optimistic about the future of new mobility options in cities, despite the deep freeze many companies have been forced into as cities confront the coronavirus pandemic.

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As cities take drastic steps to control the coronavirus pandemic, micro-mobility providers such as Lime and others have curtailed operations.
Shutterstock/trekandshoot
As quickly as rent-to-ride electric scooters landed on city streets, they have all but disappeared in some places.

Companies like Bird, Lime and JUMP have pulled the popular shareable app-based micro-mobility devices as millions of residents in cities across the nation have all but gone into isolation to slow the coronavirus pandemic.

In only a few weeks, the global COVID-19 crisis has shaken business activity of all types, resulting in record unemployment across the U.S. Scooter operators like California-based Bird laid off 30 percent of its workforce, according to the Los Angeles Times.

A growing concern among investors and industry watchers is what the transportation industry will look like in several months. How will the mobility landscape — currently shaped by emerging tech related to electric vehicles, connected cars and the rapid growth of micro-mobility — be shaped or realigned by the health crisis?

“Innovation has a certain power to adapt to new realities,” remarked Olaf Sakkers, a partner with Maniv Mobility, an Israeli venture capital fund, during a webinar hosted by CoMotion LA April 1.

The online discussion was titled “Venture Funding's Nuclear Winter? Navigating Challenging Funding Environments — and How Savvy Mobility Companies Can Prosper."

The shared bikes and scooters sector has proved widely successful to this point, racking up some 84 million rides in 2018, catching the attention of transportation officials from San Francisco to South Bend. Riders have warmed to the devices, and are not likely to walk away, said Sakkers.

“Medium-term, people will be more reticent to travel on public transit,” said Sakkers, expressing a lingering nervousness among the public, even after “social distancing” is lifted, to get too close to others.

“You’ll see micro-mobility is an essential service,” he added.

Looking to the longer term, some experts are convinced that the trends pre-coronavirus will hold course and remain a popular transit alternative.

“I do think we are still long-term bullish on the trends we’ve seen,” echoed Julie Lein, a managing partner at the Urban Innovation Fund, which provides seed capital for companies in the transportation, real estate technology, gov tech and other sectors.

How long the downturn lasts and to what degree government stimulus funds can both cushion the fall and help jumpstart a mobility economy that’s even more focused on sustainability is yet to be seen, industry watchers say.

The hope, said Matt Petersen, president and chief executive officer of the Los Angeles Cleantech Incubator (LACI), is that stimulus efforts will be focused in areas like expanding EV charging, battery storage and training for the jobs these next-generation transportation technologies will need.

“Putting the small businesses that employ those individuals, back into revenue and all that goes with that green economy,” Petersen told Government Technology last week. 

“As we look at restarting the economy, we have to look more strategically at the opportunity. We’ve never seen an economic complete halt like this,” he added, noting exceptions like natural and other disasters such as hurricanes or earthquakes. “We need to learn from those lessons. This is going to be a rebuilding process. Not a physical infrastructure rebuilding, but how do we rebuild the economy in a way that’s going reduce air pollution in which we know when people breathe dirty air, it makes them more susceptible to viruses.”

In terms of the future for electric vehicles, analysts say car companies have already invested too many resources to reshaping this sector of the automotive sector to abandon these efforts.

“We’re still bullish on electrification and EVs,” Lein said during the CoMotion webinar.

“In terms of EVs, the future has already been committed to,” said Sakker. “We’ll just see a slowdown.”

“I don’t think low oil prices or the recession will stop the inevitability of electric vehicles,” he added.

LACI works to train unemployed or formerly incarcerated residents to become technicians for EV charging stations maintenance.

“We know that’s an opportunity for workforce development, beyond the scale of what we’re doing,” said Petersen. “We want to increase the scale of what we’re doing, two- to three-fold at least, if not more so. And we need to do more of that. We need more electricians to be trained at installing EV charging stations.”

By the close of 2019 more than 700,000 electric vehicles had been sold in California since 2011, according to Veloz. The state also counts some 24,439 public charging ports. The Golden State aims to have 5 million EVs on the roads within the next decade.

“There’s going to be a before and after here. And we need to be bold in [the] after,” said Petersen.

Skip Descant writes about smart cities, the Internet of Things, transportation and other areas. He spent more than 12 years reporting for daily newspapers in Mississippi, Arkansas, Louisiana and California. He lives in downtown Yreka, Calif.