Uber just hinted it could be in serious trouble if it doesn't conquer the market for electric bikes and scooters

Jump Bike

Uber is learning that it may need to become the Uber of scooter-sharing.

• Since February, Uber users have been able to book an electric bike through the app. Now the bikes are taking a big chunk out of Uber's core car-ride business.
• An Uber employee published early results of an analysis showing that it booked 10% fewer rides in cars and SUVs after the company got into bike-sharing.
• The data suggests that Uber could be in serious trouble if the emerging scooter-sharing market also cuts into its car-hailing business.

Electric-scooter sharing startups are racing to become as dominant as Uber or Lyft in this wacky and well-funded transportation business that's revolutionizing transit in America.

At the same time, Uber is learning that it may need to end up dominating scooter-sharing, before companies like Bird, Lyft, and Ofo cannibalize its core car-hailing business.

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On Thursday, Santosh Rao, a policy researcher at Uber, published a Medium post showing that Uber trips fell 10% overall after the company got into the bike-sharing business in February. During peak traffic hours, Uber trips in cars and SUVs declined as much as 15%.

Mike Dudas, an entrepreneur who previously led mobile business development at Venmo, PayPal, and Google, shared the Medium post in a tweet that's going viral.

According to Dudas, the analysis shows Uber's "core car business would be REKT in dense urban areas by scooters if they didn't own them," in his own words.

Bird and Lime - two scooter-sharing companies that investors say are destined to become the Uber and Lyft of scooter-sharing based on their explosive user growth - are "looking like increasingly brilliant investments and businesses," Dudas said.

Jump, a startup that makes the fire-engine red electric bikes that cover the streets of San Francisco, Chicago, Austin, and Washington, DC, teamed up with Uber in February to let users book rides on its app. Uber later acquired Jump for close to $200 million, giving it skin in the game as consumers tried new modes of transportation.

Since February, according to the Uber researcher, the overall number of trips booked on Uber's app increased 15% among "early Jump adopters" - people who averaged at least one trip a week (in an Uber car or on a Jump bike) after their first Jump ride.

"The entire increase can be attributed to the use of eBikes," Rao wrote.

He added, "To sum up, eBikes were popular with these early adopters and some Uber trips, especially during congested periods, were replaced by Jump trips. This is a promising early sign of the ability of eBikes to alleviate congestion and reduce car trips. The fact that demand for eBikes is currently constrained by limited supply (there are only 250 Jump bikes in San Francisco) makes this all the more promising."

Jump

The post doesn't specify which cities Uber gathered data from. We've reached out to Uber for more information on its methodology here and will update if we hear back.

It also neglected to mention the meteoric rise of scooter-sharing, which could someday cut into Uber's car-hailing business in the same way Jump bikes have. Scooters are good for even shorter trips than the electric bikes, and are one fewer reason to book a car.

Shortly after Jump bikes cropped up on the streets and sidewalks of San Francisco, electric scooters invaded. Hundreds of vehicles covered the city before local officials issued cease-and-desist letters to their operators, forcing a temporary ban.

Twelve companies, including Bird, Lime, Uber (via Jump), and Lyft applied for permits to operate scooters in San Francisco. The city is expected to issue a maximum of five permits, sometime in August, TechCrunch reported on Thursday.

With Uber joining the fray, the company shows it refuses to be left in the dust.