Report Released on "Strategic Directions for the Reinvigoration of the Micro-Mobility Market"
The shared micro-mobility (personal mobility devices) market in South Korea is facing structural limitations due to a restricted revenue structure, highly volatile usage rates, and the burden of investment costs for technology and infrastructure. In light of this, experts have suggested that an integrated strategy encompassing revenue models, technology, and policy is necessary to enhance profitability and sustainability.
On July 30, Samjong KPMG published a report titled "Strategic Directions for the Reinvigoration of the Micro-Mobility Market," which addresses these issues.
According to the report, companies such as Gbike, The Swing, PUUMP, Beam Mobility Korea, Kakao Mobility, and Socar are currently leading the shared micro-mobility market in South Korea. Among these, Gbike and The Swing have succeeded in turning a profit through operational efficiency improvements.
However, due to fierce competition in urban centers and an expansion of regulatory risks, some companies have recently withdrawn from or suspended their businesses. The report states, "Despite expectations for market growth, domestic companies are facing limitations in the B2C-focused domestic market and concerns over a widening profitability gap." It further analyzes, "Revenue models based on fares are showing intensified price competition and limitations in raising prices, while regulatory factors such as mandatory helmet use and stricter parking enforcement are dampening user sentiment." Additionally, the report points out that the expansion of maintenance and charging infrastructure, as well as technological advancement, are increasing investment costs, and that fixed costs related to device and infrastructure operations are a primary cause of declining profitability.
Samjong KPMG proposed three strategic directions for the sustainable growth of the shared micro-mobility industry: ▲ diversification of platform-based business models, ▲ expansion of service areas focusing on demand potential, and ▲ enhancement of collaborative models to improve operational efficiency.
The report notes, "By leveraging platform operation technology, companies should expand into lifestyle service platforms such as food delivery, media streaming, and taxi-hailing, or establish platform-based revenue models by supplying their existing platforms or providing data sales and analytics services generated through the platform."
It continues, "To secure demand potential, it is important to expand services centered on 'first/last mile' hubs such as public transportation transfer points, tourist attractions, and university districts, as well as to enter global markets." The report also emphasizes, "It is crucial to proactively target regions where regulations are flexible and innovative transportation experiments are possible."
Regarding the strengthening of collaborative models, the report states, "In response to intensified technological competition and the advancement of customer experience, companies should enhance operational efficiency through joint technology development and infrastructure utilization via partnerships." It adds, "Companies should respond to regulations through policy and data collaboration with the government and local authorities, and expand private partnerships by developing dedicated products for corporate and institutional clients."
Kim Bongsu, Executive Director at Samjong KPMG, said, "The shared micro-mobility market, which once experienced rapid growth, is now undergoing restructuring as growth rates slow due to legal and regulatory risks and social issues such as 'Kickrani'." He emphasized, "As the market matures and domestic companies face a turning point, they must seek strategies for sustainable revenue generation and efficient operations to ensure survival and growth."
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