Rise of E-Scooters Reinforces Need for U.S. Infrastructure Investment

Christopher Wagner
Former Intern, Communications, U.S. Chamber of Commerce

Kelly Rosenblatt
Former Senior Manager, Small Business Policy, U.S. Chamber of Commerce

Published

November 13, 2019

On sidewalks, beside park benches, outside office buildings and restaurants – electric scooters are everywhere. After the introduction of Bird scooters to cities across the country, the high demand and popularity of e-scooters spurred companies like Lyft, Lime, Spin and Uber, to create their own range of e-scooters. This nationwide trend raced across the country, taking over urban areas like Austin, Los Angeles, Nashville, and many other bustling cities. With each new rollout, more and more people are commuting via e-scooter, and it doesn’t look like they’ll be hitting the breaks anytime soon.

But with this up-and-coming transportation trend comes a need for local infrastructure improvements on roads and sidewalks to support it. Infrastructure across America has deteriorated over the past several decades – and the infrastructure we put in place 100 years ago is no longer capable of supporting today’s transportation methods, especially in urban areas. In order for Bird and the like to sustain operation and facilitate the growth of green communities and innovative job opportunities, Congress needs to enact legislation that will reform and rebuild this country physically.

Even more, millennial and Gen Z workers increasingly rely on cost-effective, sustainable and innovative public transportation like e-scooters. In order to maintain a workforce of highly-skilled millennials, we need infrastructure to support the transportation that this demographic uses to get to and from work every day.

The e-scooter obsession can be traced back to September 2017, when the first major e-scooter company, Bird, appeared in the U.S. Bird launched in Santa Monica, California where the company entered the e-scooter market unopposed. Not long after, Lime began distributing their e-scooters in major cities across the country. After just two years, the growth of e-scooter companies is astounding. Five months after the first Lime scooter was released in the spring of 2018, the company reported high levels of engagement throughout the country, including 300,000 total rides in San Francisco alone. Furthermore, Bird scooters were able to reach 120 cities around the world, bringing in an estimated value of $2 billion after a single year of operation, according to Inc.Financial success aside, let’s take a look at the impact e-scooters have on American communities.

E-scooter companies helped create new jobs in communities with high usage. Almost all e-scooter companies run a dock-less program, meaning there are no designated public places to charge the e-scooters throughout cities where they are located. This has created supplemental income opportunities for Americans where people can sign up with the app to collect and charge the e-scooters for a return rate ranging from $5-$20, according to Bird. According to Birdand Lime, charging an e-scooter only uses about $.25 - $.40 of electricity, making it an economical and accessible job. While $5-$20 may not seem like a ton of money, the potential revenue for chargers in cities where e-scooters are common is significant. For example, if a “charger” picks up 50 scooters lying around Nashville and charges and returns them, they can make anywhere from $250-$1,000.

The regulation challenge

After Nashville received an additional 4,000 scooters on the streets in July, the city council enacted a number of regulations related to e-scooter operation, including: e-scooter curfew for night riders, use of helmets while riding e-scooters, and the creation of ‘slow zones’ to curb e-scooter speed in high-traffic areas. Safety of riders should be the first priority regarding any regulations around e-scooters. However, these companies provide an innovative and affordable mode of community transportation many consumers have come to rely on. Therefore, it is critical that these companies are not over-regulated to the point where they cannot continue to operate.

“Micromobility is bringing numerous benefits to consumers and benefiting communities nationwide”, said Tim Day, senior vice president of the U.S. Chamber of Commerce's Technology Engagement Center. “It is important that local governments take these benefits into account when considering any new regulations.”

The best way to ensure Bird and the like can continue running safely, is to modernize the infrastructure on which this innovative technology operates.

The need for a national infrastructure bill

When it comes to e-scooters, infrastructure is at the center of local regulatory conversations. While e-scooters provide a form of public transportation that many cities desperately need, regulators are concerned about what impact e-scooter use has on local infrastructure, much of which is in subpar condition. However, the real issue is in reverse. While many frame innovation like e-scooters as risks to our infrastructure, in reality, it’s our nation’s crumbling infrastructure that puts innovation at risk. The longer Congress waits to improve American infrastructure, the further we inhibit progress across a range of industries and communities.

“We need Congress and the president to move past the current dysfunction and agree on federal legislation to modernize and fix our nation’s infrastructure. The cost of inaction costs more than action. We can’t afford to wait,” said Ed Mortimer, vice president of transportation and infrastructure at the U.S. Chamber, in a statement in August.

The infrastructure debate in America dominated news cycles earlier this year when Congress and the White House failed to pass a national infrastructure bill that would have provided more state and local funding for improvements to roads, bridges, and public transit systems, among other benefits.

In July, “The Senate Environment and Public Works Committee voted 21-0... to advance a $287 billion bill that would fund the repair and maintenance of roads and bridges over five years, expedite permitting processes for major infrastructure projects and make transportation systems more resilient to climate change effects,” according to Roll Call.

While this bill is a great first step to fixing our country’s infrastructure, which currently has a D+ rating from the American Society of Civil Engineers, we need greater investment in our infrastructure for the safety of American commuters and for innovative technologies like e-scooters.

Furthermore, business communities across the country stand to benefit from government support and action behind better infrastructure. Some states have been monitoring the business impact alternative modes of transportation have on local economies when infrastructure is adapted to accommodate them. Take bicycles for example. A number of high-traffic cities throughout the U.S. installed bike lanes to ease and encourage “micromobility” transportation options and saw great results. For instance, in New York, after installing bike lanes along 9th, 1st, and 2nd avenues, retail sales rose 49%on 9th Avenue and commercial vacancies dropped on 1st and 2nd avenues by 47%. Vanderbilt Avenue, Columbus Avenue, Bronx Hub, and St. Nich & Amsterdam also saw significant increases in taxable salesover 2-3 years after the installation of bike lanes. Similar results were recorded in Seattle, where sales surged within the Latona and 65th business district by 400%, and in San Francisco, where 65% of merchants found “bike lanes had a positive impact.”

Clearly, the positive impact rebuilding infrastructure for innovative transportation methods has on business and the economy is two-fold. On one hand, it supports and encourages the production and development of innovative technology such as e-scooters and other micromobility devices. On the other hand, it grants consumers greater access to the products and markets they demand.

As the development of e-scooter companies continues, regulating this new mode of transportation will be an ongoing discussion in cities across the country. It is important that government officials invest in infrastructure to support innovative transportation methods such as e-scooters, rather than stall a growing industry many have come to rely on and support. Going forward, only one thing is certain, these new vehicles are taking our streets by storm and they’re not pumping the breaks any time soon.