WASHINGTON (dpa-AFX) - Scooter sharing major Neutron Holdings, Inc., doing business as Lime, announced its plans to close down 12 markets across the globe and to cut staff for not being profitable.
In a blog post, co-founder and chief executive officer Brad Bao noted that the micromobility company, which offers electric scooter and bike rentals, has shifted its primary focus to profitability to achieve financial independence. According to the company, the vast majority of its 120+ markets are profitable as they have adopted micromobility transportation solutions quickly. However, the select markets suffered slow improvement.
The company intends to pull out its scooters from Atlanta, Phoenix, San Diego and San Antonio in the United States. The other affected places are Linz, Austria in Europe; and Bogotá, Buenos Aires, Montevideo, Lima, Puerto Vallarta, Rio de Janeiro and São Paulo in Latin America.
The decision will impactt full-time and temporary employees in these markets. Lime reportedly will cut 14 percent of its full-time employees worldwide, that comes to around 100 people.
Lime, formerly LimeBike, was founded in January 2017 by Bao and Toby Sun as a bikeshare company. In the next year, it switched its focus to electric scooters, and signed a deal with technology giant Uber to provide them with electric bikes for the expansion of their Uber Bikes service. Lime currently has a fleet of around 120,000 scooters across the world.
Meanwhile, a report in the The Information in October said the startup is set to lose around $300 million in fiscal 2019 on revenue of over $420 million. The expected loss mainly is due to the depreciation of its scooters, which are said to have an average life of five months, as well as the costs to run warehouses to repair and position the vehicles.
Lime also faces competition from Santa Monica startup Bird, as well as ride-sharing companies Uber and Lyft. Amid the mounting troubles for scooter companies, Uber reportedly pulled its scooters out of San Diego and Lyft pulled out of six markets.
Further, Lyft in August last year withdrew a fleet of e-bikes from San Francisco, after multiple reports of bikes catching fire.
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