Earlier this year, Bike and Scooter share services in Sacramento appeared to be enjoying great success. Back in February, Jump had over 2000 scooters and an estimated 1000 bikes out on the streets of Sacramento. Additional companies Lime and Spin were also competing in our market. In April, due to the Covid-19 outbreak, they pulled nearly all of their bikes off the streets and in May, Jump’s parent company Uber sold Jump to Lime. There is much speculation about what is happening and whether the rideshare model will work going forward. What has the impact of vandalism of countless bikes, like throwing them in the river, been? What will the bigger impact of the global pandemic that forced Jump to suspend its bikes and scooter share programs be?
In May of 2018, Sacramento became the fourth to bring Jump bikes into their city. Since then the bikes have faced a lot of problems. As early as August of the same year, many of the bikes were vandalized and this problem escalated as time went on. Authorities fished countless bikes out from the American River. In total, about 15% of the bikes placed in Sacramento were vandalized.
Once COVID-19 hit, Jump faced additional problems. Although Jump doesn’t share detailed rider data, it was obvious that ridership dropped significantly when businesses shut down due to Shetler-in-Place orders. The primary reason given for removing the bikes was health and safety concerns due to Covid-19, but Bike and Scooter shared success relies on active city centers where people make many small trips, which makes the prolonged economic shutdown a serious threat. With the city license fees required to keep their bikes on the street, Jump incurs a big cost with little or no revenue if people are not using the bikes.
In May of this year, Uber lead an investment into Lime totaling $170M, as part of the deal Jump was sold to Lime. Uber says they sold this part of the company so that they could focus on the automobile part of the company. Another factor in this investment could be Lime and Uber’s competition over market share–customers having to choose between using identical products can only differentiate on price. The merger is a good sign for the companies who still appear to be losing money trying to gain market share. Lime is committed to the bike and scooter share, now with Ubers investment.
Eight months after the beginning of the Pandemic, you can now see Jump Bikes and Lime Scooters coming back to Sacramento, and Lime and Uber are partnering on joint services. Additionally, SPIN bikes are available in the Sacramento market, so some competition remains. While the bikes are beginning to be put back out for people to use, both companies are still losing money and Covid-19 remains a major issue in Sacramento County, leaving them at risk.
ABOUT THE AUTHOR
Saraia Jackson is a second-year computer science major at CSU Sacramento. Her long-term goal is to become a cybersecurity analyst. She wants to show young African American women that they can do whatever they put their minds to no matter where they come from. She also really wants to devote her life to helping children and making a difference.
Weintraub | Tobin, EY, Moss Adams, Momentum
BlueTech Valley, PowerSoft.biz, Revrnt
College of Engineering & Computer Science at Sacramento State