Bri­tain’s electric scooter boom in danger of back­fir­ing be­fore it be­gins

Start-up firms have a long way to go to quell con­cerns af­ter a shaky open­ing to tri­als, re­ports James Cook

The Daily Telegraph - Business - - Technology Intelligen­ce -

The first tri­als of electric scoot­ers on UK roads were sup­posed to be a way for the Gov­ern­ment to show how peo­ple could com­mute safely when lock­down is lifted.

But gangs of chil­dren in Mid­dles­brough have threat­ened to scup­per the care­fully laid plans of scooter busi­nesses worth bil­lions of dol­lars af­ter they took the ve­hi­cles for joyrides around the town.

First, a pair of teenagers were seen driv­ing electric scoot­ers down the busy A19 dual car­riage­way with­out wear­ing hel­mets. The boys had hired scoot­ers from Bri­tish start-up Ginger, which beat well-funded ri­vals to launch the first public tri­als of electric scoot­ers on Bri­tish roads in July.

Weeks later, there were re­ports of groups of chil­dren driv­ing Ginger scoot­ers through shop­ping cen­tres, al­most crash­ing into el­derly shop­pers.

Ben Houchen, Mayor of the Tees Val­ley, de­fended the scheme, blam­ing “a small num­ber of id­iots” for the in­ci­dents. But others have been more an­gry. Mike Hill, Hartle­pool MP, has claimed that scoot­ers are as “use­ful as a choco­late fire­guard”.

And the Na­tional Fed­er­a­tion of the Blind UK has urged lo­cal au­thor­i­ties to with­draw from tri­als over con­cerns that the scoot­ers could cause in­juries.

Ginger’s ri­vals are con­cerned news of th­ese in­ci­dents could spoil an electric scooter gold rush as more than 50 towns and cities seek to run their own tri­als in part­ner­ship with scooter hire com­pa­nies fol­low­ing a change in the law. “It was a shame to see the first trial not go so well,” says Richard Cor­bett, the UK head of Swedish scooter start-up Voi. “Th­ese is­sues should not have hap­pened.”

In­dus­try in­sid­ers say that more than 20 dif­fer­ent com­pa­nies are hop­ing that their scooter rental sys­tems will be picked for the tri­als. The busi­nesses range from in­ter­na­tional giants like Bird, with a val­u­a­tion of $2.5bn (£1.9bn), through to newly formed com­pa­nies hop­ing to profit from a rush to get scoot­ers on UK streets.

“There is now a very long tail of op­er­a­tors,” Cor­bett says. “Half of those didn’t ex­ist un­til the laws were changed.” Cor­bett is a for­mer start-up founder who is most com­fort­able in a baseball cap and hoodie. He ran Bird’s UK op­er­a­tions when it launched a scooter trial on pri­vate land in the Olympic Park in 2018, but joined Voi ear­lier this year.

Paul Hod­gins, Ginger’s chief ex­ec­u­tive, cuts a very dif­fer­ent fig­ure. Softly spo­ken and fond of wear­ing suits, Hod­gins is a Con­ser­va­tive coun­cil­lor who has spent years lob­by­ing for his home-grown scooter business. Ginger hasn’t picked up back­ing from ven­ture cap­i­tal funds, as larger ri­vals such as Voi, Bird, Tier and Lime have done.

In­stead, the com­pany re­ceived in­vest­ment from Philippe von Stauf­fen­berg, a Ger­man busi­ness­man whose great un­cle Claus von Stauf­fen­berg was the key mem­ber of the July 1944 plot to as­sas­si­nate Adolf Hitler, and was played by Tom Cruise in the 2008 film Valkyrie.

Hod­gins dis­misses the in­ci­dents in July as grow­ing pains that have al­ready been fixed. “This is the first pi­lot, so the spot­light is on it,” he says. “There will from time to time be peo­ple who use it ir­re­spon­si­bly.”

Hod­gins says Ginger up­dated its app af­ter the in­ci­dents to block rid­ers from driv­ing on the A19 and through shop­ping cen­tres. The com­pany has also added en­hanced ID checks to stop chil­dren rent­ing scoot­ers.

Ginger is now in the mid­dle of rais­ing a new round of fund­ing, Hod­gins says, and the Mid­dles­brough trial will be ex­tended later this month to sur­round­ing ar­eas.

In­dus­try in­sid­ers say some lo­cal au­thor­i­ties have ex­pressed con­cern over the in­ci­dents in Mid­dles­brough, but the hope is that tri­als due to start in cities like Cam­bridge in the com­ing weeks will prove more suc­cess­ful.

Ber­lin-head­quar­tered Tier has a large war chest, hav­ing raised over $131m in fund­ing. But the com­pany is hop­ing to start small by de­ploy­ing a mi­nus­cule num­ber of scoot­ers into its tri­als in a bid to ease cities into wel­com­ing them on to their streets.

“Get­ting scoot­ers on the ground is not the ul­ti­mate mea­sure of success,” says Fred Jones, the com­pany’s UK head who joined Tier ear­lier this year af­ter run­ning Uber’s UK op­er­a­tions.

“We’re more than happy to start a city with 50 scoot­ers,” he says. But op­er­at­ing in such low vol­umes up­sets the unit eco­nom­ics which have seen scooter business raise hun­dreds of mil­lions of pounds of in­vest­ment.

“Clearly be­low a cer­tain level, we don’t make money on it,” Jones says.

Jones is used to deal­ing with lo­cal au­thor­i­ties, hav­ing spent more than five years at Uber. But the sud­den rush of cities want­ing scooter tri­als has sur­prised him. “Lo­cal au­thor­i­ties are work­ing at a pace and at a scale that I’ve never ex­pe­ri­enced be­fore.”

If suc­cess­ful, scooter com­pa­nies could cre­ate a brand new trans­port method on UK streets and earn mil­lions of pounds.

“This isn’t a ser­vice just for the skinny jeans guys with the long hair get­ting their frap­puc­ci­nos in Old Street,” says Cor­bett. “This is for ev­ery­one.”

The first public tri­als of electric scoot­ers on Bri­tish roads be­gan in July

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