For businesses dealing with connected electric vehicles, the advantages of these business models tend to vary, depending on whether they are fleet operators or bike manufacturers. But for all those businesses, the end-users contentment is the main goal. This is why this article analyzes the value of owning and sharing models, keeping in mind the end-users needs.

From the end-user perspective, the world of connected vehicles is becoming more and more familiar. It’s not a question anymore whether or not to connect your bike, it’s more of a discussion, which kind of connected bike or scooter to use. Should I rent one? Should I buy one? What are the benefits and downsides of both business models? Will one dominate the other or can they co-exist?

Ups and downs of using sharing services and owning vehicles

The sharing economy altogether has positive environmental impacts, through a reduction in the total resources required. It helps reduce pollutants, emissions, and carbon footprints. In the transportation sector, for example, vehicle sharing behavior can have a positive environmental impact by decreasing the number of kilometers traveled.

In more detail, short-term sharing services, such as Bird and Tier, can be proven useful while traveling, assisting people as a means of commuting between different bus and train trips. Furthermore, in current times, using this model is a great alternative to getting around in the city, when public transport works against social distancing. As a downside though, the shared-vehicle maintenance system still needs improving, as frequent everyday use has its toll on the bikes’ durability, causing them to break down more easily. It’s also hard to rely on the availability of the shared vehicle, as more and more people use this kind of service as a means of transport on a daily basis. Some operators though are already introducing daily/weekly/monthly passes for heavy users.

Long-term sharing service is more reliable in that sense, as it is always available. Due to it, the vehicles stay in better shape, as they have not been used by that many riders. The selection of the vehicles still tends to be rather poor in most cases, however, as shared vehicles’ business is booming, but still not fully developed. But there's likely a good market opportunity for more premium subscription bikes. One good example of a long-term sharing service is Movelo, which offers different versions of e-bikes as a ‘corporate sharing’ model, where employees can rent a bike for their commute and time off.

If you really want to rely on always being able to ride with a connected electric bike and be able to decide, which kind of bike should it be, it would be best to own one. Buying your own connected bike has its advantages, because the choice, which kind of bike to choose is completely your own. Simply get a bike (or scooter) you’d prefer. However, the ownership of a connected vehicle brings some obligations with it. You’d have to pay for the maintenance yourself and do regular check-ups. With shared vehicles, there are people taking care of them.

Coming down to it, there are different aspects to consider in both business models. Sharing (short-term and long-term) can be proven useful, where owning an e-bike is unnecessary. If the availability and specifications of the bike are important for the user, it’s best to own a vehicle. But how do we know which model is more sought-after by end-users in the micromobility industry?

What’s the market demand?

As stated above, both business models still have some obstacles to work with. Since the connectivity industry is booming, both fields are doing their best to constantly offer new features and updates to improve user experience. According to The Verge, Scooter-sharing giant Lime is updating its app to make renting one of the company’s battery-powered two-wheelers a little easier. Customers can take advantage of new features like app-less riding, 10-minute reservations, and vehicle configurations to take some of the bites out of scooter-sharing. Statista survey on the matter has calculated that revenue in the bike-sharing segment is projected to reach US$7,214m in 2021 and is expected to show an annual growth rate (CAGR 2021-2025) of 11.23%, resulting in a projected market volume of US$11,040m by 2025. 

Next to shared vehicles, e-bikes sales continue to rise as well. Forbes has forecasted that Europeans are expected to buy an extra 10 million bikes per year by 2030, 47% more than the annual number in 2019, said a joint statement from the three groups. The 30 million per year total will take bike sales to more than twice the number of passenger cars currently registered per year in the EU. 

Based on these examples, it’s clear that the demand for both directions is estimated to grow significantly, and there is no market saturation soon to be seen. How can both businesses ensure the continued growth of their entrepreneurship?

Connectivity plays an important role

Whether or not you decide to use a shared e-scooter/e-bike service or buy one for yourself, the key element in improving user experience and taking the maximum out of it is IoT. Connecting your bike or using a connected sharing service offers the user a peace of mind experience, not to mention the constant updates it provides, improving the user experience on the go. Using IoT on e-vehicles turns the scooters and bikes into a completely different mobility device, changing the way we commute on a daily basis.

When it comes to the increasing popularity of IoT connectivity, it demands more off-the-shelf solutions, as the businesses keep growing and time to market is of the essence. A vertically integrated IoT solution can be of huge help here, taking care of sim management, backend & middleware management, troubleshooting tools, vehicle integrations, entire system uptime & global availability. It is essential for fleet operators, helping them to improve the durability of constantly used vehicles, thus improving the quality of their service for end-users. But it can also be substantial for e-bike enthusiasts, engaging them to become loyal riders.

To learn more about how can connectivity help both businesses along, helping those models to increase the number of their end-users, take part in Comodule’s panel discussion on April 15th!

Join here