Global electric bicycle industry is expected to reach a market size exceeding $21bn by 2023
Uber to move from cars to e-bikes for shorter trips
Ride-hailing company Uber, which is aiming to go public next year, plans to introduce electric bicycles and scooters for smaller trips in inner cities, according to a media report published on Monday.
Uber is adding electric bicycles to its fleet as an easy alternative to cars, Dara Khosrowshahi, the chief executive of Uber, told the Financial Times.
“During rush hour, it is very inefficient for a one-tonne hulk of metal to take one person 10 blocks,” he told the newspaper.
The global electric bicycle industry is expected to reach a market size exceeding $21 billion by 2023, with a compound annual growth rate of 5.91 per cent, according to a recent report published by the Market Research Future. Uber completed an agereement with electric scooter rental company Lime last month to bring an unconventional mode of transportation to the world. The deal, led by Alphabet’s venture arm GV, values the scooter business at $1.1bn.
In April, Uber acquired the start-up Jump Bikes, which rents electric bicycles, for more than $200m.
Uber suffered financial losses of $4.5bn last year, but Mr Khosrowshahi told the FT that short-term losses were necessary to achieve longer-term goals.
“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.
Uber, based in San Francisco, said its net loss narrowed to $891m in its second quarter ending June 30 from $1.1bn a year earlier. Its adjusted loss before interest, taxes, depreciation and amortisation was $614m, down from $773m a year earlier.
Uber is looking forward to commercialising individual modes of transport while not affecting its drivers.
Mr Khosrowshahi admitted that Uber drivers would initially experience a dip in income because of passengers opting for bikes, but “over the longer term, drivers would benefit from a higher proportion of more lucrative longer rides and less congested roads”.
Uber has been slimming down its businesses outside its core markets as it prepares for its own listing. Last year, Uber and Yandex agreed to merge their ride-hailing businesses in Russia. In July, Bloomberg reported that Uber and Careem are in preliminary talks to combine their Middle East ride-hailing services, hoping to resolve a costly rivalry.