Source: Zag Daily

Segway, the shared mobility vehicle supplier and LEVA-EU member, has played a significant role in enabling operators to achieve profitability

With shared micromobility services continuing to expand globally and the market consolidating, for operators a key challenge is balancing growth, sustainability and profitability. Vehicle solution provider Segway has played its part in enabling partners to build sustainable business models.

Recent years have seen fluctuating fortunes in the industry, but as the market has matured, we have seen examples of operators generating healthy profits, with Norway’s Ryde, South Korea’s Swing, and Kazakhstan’s JET reporting consistently positive earnings before interest and taxes (EBIT), and Tier-Dott on its way towards this.

Shared insights

Some of these key industry players took part in a panel co-hosted by Segway at the Micromobility Europe expo in Amsterdam in June 2024, sharing insights on why their business models are working.

San Kim, CEO of Swing, shared that South Korea’s regulations have helped it achieve profitability gains, as there are no government-imposed restrictions on fleet sizes. It also operates a franchise model to achieve economies of scale, purchasing scooters from Segway, which has delivered significant profit margins. He also highlighted a cultural factor, that the vehicles are carefully handled by Korean users, helping to extend their lifetime. 

Tobias Balchen, CEO of Ryde Technology, portrayed Ryde as a utilisation business, “extremely dedicated to building utilisation on their vehicles”, and that they only do in-house operations which means they can control the cost and quality. “Efficient operation with high utilisation brings fantastic financial results.”

Henri Moissinac, CEO of Tier-Dott, highlighted the importance of the consumer experience. “If you have a big enough fleet then that will generate enough profit which means you can invest in R&D and build a better experience for your riders, so this is a positive feedback loop.” He also added that Tier-Dott’s funding strategy has been for slow, sustainable growth. “We focused on having the best user experience in the three most competitive cities in Europe and we only raised further money when we proved to our investors that we could have better unit economics and better user experience than our competitors.”

The panel’s moderator was industry expert Prabin Jones, who later shared his own insights. “Shared micromobility has often been dismissed as an unsustainable business model, but the panel made it clear that profitability is achievable.  

“A common trait among successful companies is their lean approach: minimal reliance on VC funding, small HQ and tech teams, and G&A costs kept below 20%.

“These companies are also diligent in picking the right vehicle and did not experiment with in-house vehicle developments. Most of these companies have in-house operations with a robust maintenance setup, making sure that the scooters last as long as possible.”

How has Segway boosted the potential of shared micromobility?

Segway’s strategy goes beyond simply offering affordable vehicles to its partners, with a focus instead on Total Cost of Ownership (TCO) optimisation strategies, which factor in operation, repair, maintenance and hardware recycling costs as well as the initial hardware outlay costs. This strategy has been segmented into four key areas: 

(I) Creating vehicles that last

Segway has refined its vehicles to ensure they are robust, reliable and meet the specific needs of operators across different environments. Alan Zhao, a Segway Director, said to Zag Daily, “We are committed to delivering the best micromobility vehicles on the market. Our vehicles are designed for operational efficiency, extended lifespan, advanced technology integration, and ease of maintenance.” 

For example, Segway’s latest D110L e-scooter has a 5-year lifecycle or 30,000 kilometers for the key components, offering long-term reliability for operators. It optimises energy consumption by minimising standby power and enhancing energy efficiency during rides with its advanced 46.8V, 1147Wh battery, which enables travel up to 100 kilometers on a single charge. This also enhances operational efficiency with a reduced need for battery charging and swapping.

(II) Efficient and safer operation through technology

Segway was the first vehicle provider to introduce AI technology to shared vehicles, introducing the AI-powered Bot Series T60 for shared scooter operators worldwide in 2019. It has continued to develop AI’s use in shared e-scooters, enhancing both riding safety and addressing industry challenges like parking management.

“Our AI-driven products range from the S90L to the current full lineup of Segway Pilot solutions, including Segway Pilot, Segway Pilot Edge, and Segway Pilot Lite – an “AI box” that offers lane and pedestrian detection for shared e-scooters. The latest Segway Pilot Lite provides the same advanced AI capabilities as the Pilot and Pilot Edge models but at a more cost-effective price, enabling operators of all sizes to adopt cutting-edge technology,” says Zhao. 

(III) Fostering long-term partnerships with operators

Segway aims to build long-lasting, service-focused relationships with operators, and recently launched a new year-long warranty policy, Segway Care Commercial, designed to maximise client profitability and vehicle lifetime. It is available for e-bikes and e-scooters purchased from Segway from 6 June 2024 onwards, and covers 100% of the vehicle’s key components for up to 12 months at no cost to the client. Covered components include the handlebar, frame, tube, motor, wheel hub, dashboard assembly, front suspension, forehead, battery pack, IOT, controller and more. 

“Our data suggests that this new plan has the potential to annually reduce component costs by up to 20%,” says Zhao.

(IIII) Driving the industry toward a more sustainable future

One of Segway’s primary goals is to offer operators greener, more sustainable vehicle modes. In 2023, leading testing and certification organisation TÜV SÜD awarded Segway the first-ever Life Cycle Assessment (LCA) Verification Statement for its Max S90L and Max Plus X scooter models, and later its D110 model too. This verification statement signifies these models meet the ISO 14040 and 14044 international standards for life cycle assessment. The environmental impact is assessed at raw material, production and distribution stages, taking into account global warming impact, water and energy consumption, and resource depletion. 

Zhao says: “We have utilised recycled metal for approximately 41% of a recent vehicle’s total metal weight and are now in the planning stages to extend the use of recycled metal into all shared e-scooter models. We also incorporated a milestone of 51% of recycled plastics into the total plastic weight of a vehicle, and are now working to incorporate recycled plastics into all our shared e-scooters.”