Usage drops 30-50% as regulations increase... No signs of recovery
Seoul City enforces immediate towing... 23.6 million won in towing fees in one week
Industry says "We agree on road traffic safety but inadequate regulations cause confusion"
PM license discussions also stalled... "Ecosystem may lose vitality"
[Asia Economy Reporter Lee Junhyung] Shared kickboard startups are growing increasingly concerned amid mounting regulations. The industry says that adverse factors have compounded, following the recent mandatory helmet-wearing rule and Seoul City's strengthened kickboard towing measures. Discussions on the personal mobility (PM) exclusive license, which the government planned to introduce in the second half of this year, have stalled and failed to gain momentum. There are concerns that investments from venture capital (VC) and others may shrink, potentially draining vitality from the related ecosystem.
According to the industry on the 24th, the usage rate of shared kickboards, which sharply declined after the amendment to the Road Traffic Act was enforced in May, has not shown signs of recovery. The core of the recent Road Traffic Act amendment is the mandatory helmet-wearing and license possession when riding shared kickboards. According to the Personal Mobility Industry Council (SPMA) under the Korea Startup Forum, composed of 14 companies, the usage rate of shared kickboards dropped by 30-50% after the amendment was enforced. A representative from a shared kickboard startup said, "It is true that the number of users and sales sharply decreased starting from May," adding, "There is growing concern that if this situation continues, not many companies will be able to maintain their services."
(Seoul=Yonhap News) Reporter Lee Jeong-hoon = On the morning of the 15th, a Songpa-gu Office official is towing an illegally parked electric scooter near Garak Market Station in Songpa-gu, Seoul.Seoul City will tow illegally parked shared electric scooters in six autonomous districts (Seongdong, Songpa, Dobong, Mapo, Yeongdeungpo, Dongjak) starting from this day. The companies of the towed shared electric scooters will be charged a towing fee of 40,000 KRW and a storage fee (700 KRW per 30 minutes). July 15, 2021
uwg806@yna.co.kr
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? Yonhap News Agency, unauthorized reproduction and redistribution prohibited
Immediate Towing Measures Intensify... Issues of Fairness Raised
As Seoul City began full-scale immediate towing of illegally parked shared kickboards last week, the industry found itself facing double hardships. Starting from the 15th of this month, Seoul City began immediately towing shared kickboards illegally parked at subway station exits and other locations in six districts including Seongdong-gu, Songpa-gu, and Dobong-gu. When a kickboard is towed, companies must pay a towing fee of 40,000 KRW per unit and a storage fee of 700 KRW per 30 minutes. According to Seoul City, as of the 21st, the number of immediate towing cases reached 590. Mathematically, the industry must bear towing fees amounting to 23.6 million KRW within a week of the introduction of immediate towing measures.
The industry agrees with the purpose of "road traffic safety" but argues that the regulations have many shortcomings. They point out that multiple regulations have been introduced in succession without proper countermeasures, only increasing confusion regarding shared kickboard usage. An SPMA official explained, "There is room for local governments to implement policies differently regarding related regulations, which inevitably causes confusion for both users and operators," adding, "Although bicycle users are also required to wear helmets, unlike PM, they are not fined for non-compliance, raising issues of fairness."
On the 13th, when the revised Road Traffic Act strengthening regulations on the use of personal mobility devices (PM) such as electric kickboards came into effect, an electric kickboard was parked in downtown Seoul. According to the amendment, only those holding a driver's license of 'Class 2 Motorized Bicycle License' or higher can ride electric kickboards, and a fine of 20,000 won will be imposed if riding without a helmet. Photo by Kim Hyun-min kimhyun81@
Helmet Loss Rate 70-90%... "A Critical Juncture for Domestic Startups"
There are also opinions that campaigns to raise civic awareness should precede regulations. Helmets, which are lost more than half the time, are a representative example. According to the industry, some companies provided helmets free of charge to encourage users to wear them, but due to theft and other reasons, the helmet recovery rate is only 10-30%.
The introduction of a PM-exclusive license within this year also remains uncertain. Previously, the National Police Agency had planned to introduce a PM license in the second half of this year as a follow-up measure to the enforcement of the Road Traffic Act amendment. However, the National Police Agency has yet to finalize internal discussions and is currently stuck in the stage of coordinating direction. A National Police Agency official stated, "(The PM license) must not conflict with existing licenses and should harmonize with them, so we are giving much thought to the direction," adding, "Since no draft has been produced yet, it is difficult to confirm the exact introduction timeline."
Given these circumstances, concerns are emerging that the shared PM industry, centered on startups, may lose its growth momentum. The successive regulations inevitably act as investment risks for startups. An industry insider said, "If VC investments shrink, small domestic startups could face an existential crisis," adding, "If that happens, ultimately, large corporations or foreign companies like Lime will take the lead in the industry."
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