Uber pivot to ebikes and scooters for short journeys

JUMP
Bikes

• Uber will focus on electric bikes and scooters over
  cars for short city journeys.
• That will impact short-term profitability, CEO Dara
  Khosrowshahi told the Financial Times.
• But it’s much more efficient to take a bike or scooter
  for a 10-block journey than a car.

Uber will focus on electric bikes and scooters over cars for
shorter, inner-city journeys, its chief executive
told the Financial Times in an interview.

It is, perhaps, bad news for Uber drivers who already feel
squeezed by low fares. But Dara Khosrowshahi said electric
scooters and bikes made more sense for shorter trips.

“During rush hour, it is very inefficient for a one-tonne hulk of
metal to take one person 10 blocks,” Khosrowshahi told the
Financial Times. “We’re able to shape behaviour in a way that’s a
win for the user. It’s a win for the city.”

The decision shows Uber capitalising on an exploding new trend.
US startups such as Bird, Jump, Spin, and Lime have raised
billions in venture capital by renting out ebikes and scooters
for short city rides. The trend has yet to hit London,
partly because electric scooters are illegal in UK, but the
trend is just starting to take off in Europe as the startups
expand. 

Uber acquired
one of those startups, Jump, in April, and has begun offering
bikes and scooters in US cities through its app. The plan is to
expand globally.

Uber is expected to go public in 2019, but Khosrowshahi said the
move towards scooters and bikes would impact the firm’s
profitability in the short term. The company earns less per mile
from renting scooters and bikes than it does for car rides.

“Short-term financially, maybe it’s not a win for us, but
strategically long term we think that is exactly where we want to
head,” he said.

Khosrowshahi also insisted that drivers were on board, because
the shift means riders are more likely to take a private hire car
for longer, more expensive fares.

“When I’ve spoken to our driver partners about it, the first
impression was, why are you bringing in a bike to compete against
me?” he told the Financial Times. “The second impression after
the conversation is, oh, I get a longer ride where I can make
more money? Sign me up.”