The Latin America bike sharing market is poised to register a CAGR of over 6% during the forecast period (2020 - 2025).
- Increasing traffic congestion, insufficient mass public transport, increasing rates of road fatalities, growing awareness among peoples for environmental concerns, will drive the bike sharing market. Bike sharing provide a convenient way of transportation at minimum cost without any hassle.
- The idea of company bike leasing is becoming increasingly popular in Latin America. bike sharing solutions are successfully adapting success stories of developed countries to small Latin American countries.
- After the success of bike sharing option of conventional bikes many startups and companies started adding electric bikes in their fleet or increasing their fleet. For instance, in June 2020, Tembici has received a USD 47 million series B funding by Valor Capital and Redpoint eventures, through which company is planning to double its electric bike fleet and to expand in other major cities of the region.
Key Market Trends
E-Bike Rental is providing the growth in Bike Sharing Market
There is always a need for better transportation in the region which has encouraged many multinational firms and startups to produce better alternatives such as ride-hailing, car sharing, integrated mobility, and bike sharing. Renting a bike is cheaper and convenient than owning a car, and this bike sharing platforms are pushing people to leave their cars for a eco-friendly transport system. For instance,
In April 2020, Colombian startup MUVO received a USD 2 million funding, Auteco Mobility has led the round of funding, after this funding MUVO is planning to expand its electric bikes to Medellín and Bogotá.
Similarly, just after its launch in 2018, Grin received USD 45 million from Y Combinator, in Series A rounds, and then it merged with São Paulo-based Ride for further expansion across Latin America. And after that, it partnered with Colombia’s Rappi in a test phase of 150 scooters.
Whereas in 2019, Lime expanded its electric scooters in Brazil, Argentina, and Peru. The company came up with innovative idea for solving the problem of irresponsible riders as company is planning to launch First Ride Academy, a series of free weekend training to teach the riders basics of safe scooter riding and responsible parking.
Many United States startups are entering in to this rapidly growing bike sharing market. For instance in 2018, California based startup Bird launched its electric scooters rental service in Mexico City,In future company has plan for expansion in Brazil too.
Dockless Bike Sharing is Expected to Grow at the Faster Rate in Market
Different from several European and North American countries, Latin America has the tradition of car ownership as it is looked at as a prestigious asset. However, the view of the younger generation is changing as they opt for on-demand transportation options instead of owning a costly car.
Major cities in the region have the problem of traffic congestion during peak hours, countries such as Mexico City, Bogota, and São Paulo are having good public transportation systems but they are struggling to support their increasing populations. In the region various dockless bike sharing startups are active and they are continuously expanding their presence.
In 2018, Yellow a Brazil-based bike sharing startup has raised around USD 9 million in seed round funding. At that time it is the first dockless bike-sharing platform in Brazil. And for next year the company has plans to introduce dockless electric bikes.
Whereas many startups are adding new bikes in their fleet for providing better options to the customers. For instance, In 2019, Bird unveiled its new electric scooter called Bird Cruiser, It includes featuressuch as hydraulic disc brakes, an LCD matrix display and a 52 V battery. At starting Bird Cruiser will only be utilized for company’s bike sharing fleet not for customers sales.
The Latin America bike sharing market is consolidated with the presence of a limited number of regional players, although various new startups are entering into the market such as Grin, Tembici, Bird. The market is highly driven by factors like advanced technology, easy to use renting schemes, growing investment, and startups entering into new countries. To provide a more convenient experience to the commuter, major bike rental service providers are expanding their market reach and adding more bikes in their fleet. For instance,
- In 2019, Grin has announced that it is entering into a merger with Yellow. the combined entity which will be Grow mobility will operate over 135,000 vehicles across six countries. The company is planning to double its fleet size and expand its regional reach. And in March 2020, Grow mobility was sold to Mountain Nazca investment fund in an undisclosed amount.
- In 2019, Uber’s launched electric bikes with a fleet of 1,200 bikes in Chile, with the name Jump. Company plan is to reach to all the major Latin American countries as they have operation in Mexico City, Santos in Brazil and the Las Condes area in Santiago.
- In 2019, Bird, acquired Scoot, after the acquisition Scoot will be the subsidiary of Bird and will operate independently.
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