Since the first shared e-kickscooter operations launched in 2019, Germany has been at the forefront of micromobility offerings in Europe. In 2021, the market’s six largest global operators maintained a fleet of nearly 120,000 e-kickscooters in the country during the peak summer season, making nearly 70 million trips that year despite the impact of the pandemic. This implies that, on average, almost 90 percent of Germans made one shared e-kickscooter trip in 2021.
What’s more, e-kickscooter operators have generated more than $110 million in revenues in the country, including aftermarket and maintenance services (exhibit). That comprises nearly one-fourth of all revenue in Europe, making Germany the largest market for shared e-kickscooters on the continent. Given the relative strength of this market, Germany offers some lessons for operators seeking to move into new markets and scale up their shared-micromobility operations.
Exhibit
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McKinsey_Website_Accessibility@mckinsey.comThe factors behind Germany’s e-kickscooter strength
Germany has a large population and a regulatory environment conducive for shared micromobility operators, both in cities and at the national level—which has become even more obvious over the past two years. Adding to the momentum, German consumers are keen to try new mobility modes. City investments in micromobility-friendly infrastructure have also made the use of e-kickscooters not only more convenient but safer; converting car lanes into bicycle lanes has been particularly helpful.
Despite the popularity of e-kickscooters, the German market still offers massive room for growth in micromobility. Approximately 65 percent of German respondents in a McKinsey survey said they would consider micromobility options (including bicycles, e-kickscooters, and mopeds) for their daily commute. That was just slightly below the global average of 70 percent.
Lessons from the German market
What can global micromobility companies learn from the German shared e-kickscooter phenomenon? Three insights stand out.
Fierce competition calls for sophisticated pricing
Sophisticated pricing strategies for e-kickscooters can help boost market share and increase customer loyalty. While most companies charge through a two-tiered structure (an initial fee to unlock the scooter and then a per-minute usage fee), some are experimenting with different methods. For instance, a few players only charge the usage fees, forgoing the unlock fee. Their objective is to build share as fast as possible and retain those customers during the coming shakeout.
Another innovative pricing strategy involves offering flat-rate packages in which users pay a fixed price to obtain ride minutes or free unlocking for a certain period (mostly weekly or monthly). This strategy aims to increase market share among heavy users, such as commuters, who benefit from cheaper prices on a per-trip basis.
Operational excellence will differentiate players
To most consumers, e-kickscooters are largely interchangeable—a tool that offers short-term transportation. Providers must differentiate themselves by doubling down on operational performance of not just the vehicles themselves (though that’s a baseline) but the entire network. That entails analyzing demand at the city block level so that e-kickscooters can be in the right places at the right times in volumes sufficient enough to guarantee availability whenever needed.
To get operations right, companies must also determine the best location for centralized warehouses where vehicles can be serviced and stored. Ideally, they should be in downtown locations to minimize transit times and optimize costs. Some providers are solving the operational challenge by paying the employees who charge the scooters to relocate. While this option may be viable for other providers, it is expensive.
A sweet spot exists between growth in existing markets and expansion to smaller cities
The six largest global e-kickscooter operators cover more than 80 cities in Germany. In addition, more than 15 local e-kickscooter providers are active in the country—some in large metropolises, others in smaller cities with as few as 30,000 inhabitants. Given that the market is fragmented and expanding rapidly, companies need to identify and focus on cities that matter most and then develop a precise growth formula. Some operators may choose to focus on expanding into additional cities or new geographies. Others, fearing that expansion may overstretch their organizations, may focus on investing in operational improvements in their current cities and only expand into a few smaller cities.
The micromobility sector is consolidating fast and has already generated enough of an operational history that companies can learn from experience. By understanding the lessons of e-kickscooters in Germany, the largest micromobility market in Europe, smart providers can position themselves to succeed over the long term.
Kersten Heineke is a partner in McKinsey’s Frankfurt office, where Benedikt Kloss is an associate partner; Darius Scurtu is a consultant in the Munich office.