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In the two-wheeler sharing market, electric scooters are getting hot

In the two-wheeler sharing market, electric scooters are getting hot


India, January 21, 2019 :  Two-wheelers rule India’s roads. Most of us have grown up riding first a bicycle and then a motorised two-wheeler. Yet, the bike-sharing business  be it bicycles or scooters  have not seen the kind of success that the cab-hailing ones have. ZoomCar’s bicycle sharing service Pedl, which operated over 15,000 cycles across Bengaluru, Pune and other cities at its peak, at a price of just Rs 3 for 10 minutes, announced in December that it is halting the services across the country. Chinese bicycle sharing pioneer Ofo, which is backed by the powerful Alibaba Group, is said to be on the border of bankruptcy. The company had launched in India too, but withdrew around the middle of last year.

However, entrepreneurs and investors are not giving up yet. Indian bike-sharing startups raised around $138 million in funding in 2018, compared to just $2 million in 2016, according to estimates by startup data platform Tracxn. Some entrepreneurs are continuing to experiment with newer bicycle-sharing models. Others are trying to see if scooters — in particular, electric scooters — would work better.

Sudeept Maiti, Senior Manager, World Resources Institute (WRI) said, “Our cities already have more vehicles than we can handle, and urban planning systems need to focus on making it convenient for people to move to mass transit systems”.


Bike-sharing is seen as the best solution to solving the last-mile connectivity gap associated with public transport. The walk to the bus stops or metro stations or from there to our homes or offices — may often be too long. Getting to them on an autorickshaw or cab may be expensive. That’s the gap the low-cost bike-sharing option hopes to fill. Besides, short shopping or office commutes.

Ola in December invested $100 million in Bengaluru-based scooter-sharing venture Vogo, which earlier the same year raised about $6 million from Matrix Partners, Stellaris Venture Partners and Hero MotoCorp chairman Pawan Munjal, and before that from individual investors including former Formula One driver Karun Chandhok.

Gurgaon-based Mobycy launched bicycles for short distance commutes in 2017, but is now focusing on electric scooters called Zypp. Mobycy co-founder Akash Gupta says they used to see an average of just three rides per day per cycle. “But with scooters, it’s almost 10 rides per day per scooter,” he says. Mobycy needs only four rides per day per scooter for profitability.

When Zypp was launched, Mobycy owned the fleet of over 300 custom-built scooters. It is now in talks with bankers to go the leasing way. That could make the model a lot more scalable.

Vivekananda H, co-founder of Bounce (formerly Metro Bikes), says most commuters in India are already comfortable with scooters as a mode of travel. “That makes it easy for us,” he says. 

The rise in popularity of electric vehicles (EVs) is being seen as an inflexion point for the segment. Jeetender Sharma, founder, and MD of Okinawa, a Gurgaon-based maker of e-scooters and bikes, says he is working with Delhi Transport Corporation and several startups across the country to develop e-scooter fleets.

Bounce’s Vivekananda says he is working with local and foreign players to increase electric vehicles in its fleet quickly. It’s a more cost-effective option, it’s simpler to operate, and provides a smoother ride.

Hexi, a joint venture between Hero Cycles Group and Chinese bicycle sharing entity Youon Bike, has e-rickshaws and bicycles that are used in universities, and commercial and industrial campuses. Aditya Munjal, director, Hexi, says one needs to be cautious about the freefloat model, where users can drop the cycles anywhere. It often leads to issues of vandalism and theft. Cycle parts like seats are a particular attraction. Munjal says it is this that impeded the Chinese bike-share market. Indian startups, he says, must ensure they have control over their inventory.
 

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