Small joint mobility operator Lime will temporarily close operations in several South Korean cities at the end of the month. Lime attributes its withdrawal to regulatory deficiencies, such as the lack of a request for proposal (RFP) process, which resulted in a large number of operators with uncontrolled fleet sizes causing disruption and passenger compliance issues, especially regarding parking and congestion.
“[RFP processes] Allowing cities to take command (and ownership) of the chaotic scooter environment in order to improve parking, ensure safety and create a market that suits its citizens “we will.” We believe South Korea would benefit from moving to RFP systems that select a few premium operators in each city to offer the best programs Small mobility possible.”
There are more than 20 e-scooter rental startups operating more than 50,000 e-scooters in Seoul, the capital of South Korea, including Swing, Beam, Xing Xing, and Kickgoing. Lime’s criticism of the lack of an RFP process in South Korea comes as many companies, such as Tier and Neuron, prefer limited seller permits and even exclusive relationships with cities.
Lime also follows other joint scooter companies, such as Wind Mobility and Gcooter, which pulled out of South Korea in recent months after a series of industry regulations. South Korea’s revised road traffic law, which took effect on May 13 last year, requires e-scooter users to be 16 or older, have a valid driver’s license, and wear a helmet, which Lime said has caused lower passengers.
The law also states that riders of e-scooters must use bike paths and park in designated parking lots. In Seoul, parked e-scooters are illegally towed and a withdrawal fee of 40,000 KRW (approximately $30.89) is charged.
Lime hasn’t shared how much fines it paid last year on illegally parked scooters, nor why GPS technology hasn’t worked to ban illegal parking, though the company said it has GPS technology in some specific areas.
Lime’s withdrawal comes two years and seven months after the company first launched operations in October 2019. Lime operated nearly 22,000 vehicles in South Korea at some point, according to the spokesperson. The company has not said when it will return to South Korea, the only Asian country where Lime operates, but the spokesperson told TechCrunch Lime that it intends to continue working with the government and other operators to create a regulatory framework that allows for long-term success for precise navigation in the country.
“Policies put in place by the major government and the mayor of Seoul Metropolitan City have encouraged us to invest in shared mobility infrastructure, and we look forward to being a long-term partner of Korean cities,” said a Lime spokesperson. “As the Korean e-scooter market continues to develop, we hope to be back with our latest equipment so that passengers can enjoy the best program possible.”