Lime Scooters Leave San Antonio, Lay Off Staff | KERA News

Lime Scooters Leave San Antonio, Lay Off Staff

Jan 10, 2020
Originally published on January 13, 2020 9:04 am

Lime, one of the largest electric scooter companies in the world, has pulled out of San Antonio and will lay off staff.

The surprise announcement comes as the city was negotiating one of three exclusive contracts with Lime. The deal was initially slated to be completed by next week and would have limited the number of scooters in San Antonio to 3,000. Now, the city says it will continue with the remaining vendors Bird and Razor, eliminating the third contract and shrinking the fleet size to 2,000.

"The City will continuously monitor the market and collect data on dockless vehicle usage, and in the event the data supports additional permits, City staff will present City Council with a recommendation," a city press release explained. 

Lyft also left the city shortly after it was recommended for the contract in November. 

The two high profile departures are said to result from plummeting scooter ridership across the country. San Antonio has seen it dip to as little as one-third of its high water mark, dropping from above 300,000 to below around 100,000.

“Part of realizing our vision to transform urban mobility is achieving financial independence; that is why we have shifted our primary focus to profitability,” said CEO Brad Bao in a press release.

The statement added that certain markets were moving too slowly on adopting micromobility solutions. San Antonio spent more than a year trying to come up with regulations around the technology. 

Lime scooters dropped into San Antonio in the summer of 2018. A lot has changed since then, the least of which is the city’s regulation attempts. At the time, venture capital investors had not suffered the 2019 public offerings, nor had the industry seen the continued struggle of Uber. As has been detailed in books and media coverage, not all companies swimming in investor money reached profitability. Then there was the WeWork debacle.

“Money has been loose and free, pretty available, and the recent rash of IPOs that fell flat," said David Heard, CEO of Techbloc, who often has acted as an advocate and surrogate for these companies, “A renewed level of scrutiny may be at play here.”

In short, the company needs to make money, and it wasn’t (or wasn’t making good enough money) in these 12 markets, including San Antonio. If they don’t, big investors may cut them off. The company turns three years old in February. By comparison, Uber spent 10 years being unprofitable before its IPO, and it lost $1.1 billion in a single quarter last year.

Lime laid off the staff at its new 17,000-square foot service center in San Antonio. When it opened in August it was expected to create 50 jobs and service more than 6,000 vehicles from across Texas each day. The center will be relocated to Austin, according to the company, which declined to say how many people were affected. 

San Antonio was Lime's only Texas market that was closed. Corpus Christi, Lubbock, Austin and Dallas may continue to operate.

Editors Note: This story was updated to reflect that Lime laid off staff at its service center, not Lyft.

Paul Flahive can be reached at Paul@tpr.org and on Twitter at @paulflahive.

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