The shared service model of scooter companies Lime, Bird and Spin has lost some of its appeal as cities try to stop the spread of the coronavirus.
Profitability was already a challenge before the pandemic erupted for electric scooter rental company Lime. In January, Lime cut 14 percent of its staff, or about 100 employees, and withdrew from several markets to tighten up profitability.
In March, the company said it would wind down its service in all markets except South Korea as a result of the pandemic. Lime enhanced its cleaning and disinfecting processes for its remaining scooter fleet.
In April, Lime cut an additional 17 percent of employees, bringing the total reduction to one-third of its staff since the start of the year. Lime said in an SEC filing at the end of April that it had furloughed approximately 288 employees and implemented salary reductions for remaining employees.
In May, Lime received some much-needed aid when ride-hailing giant Uber along with Alphabet Inc., GV, Bain Capital Ventures and others completed a $170 million investment round in the company. At the same time, Uber said it will transfer its own bicycle and scooter business, Jump, to Lime.
Rival company Bird also has struggled in the pandemic. Bird laid off about 30 percent of its employees in March.
"The unprecedented COVID-19 crisis has forced our leadership team and the board of directors to make many extremely difficult and painful decisions relating to some of your teammates," Bird CEO Travis VanderZanden reportedly said in an internal memo. "As you know, we've had to pause many markets around the world and drastically cut spending."
Bird released a memo earlier in March about increasing the daily frequency with which the company cleans and sanitizes its vehicles and helmets, increasing the frequency of its deep-cleaning "Bird Baths" that take place at local service centers, and providing extra gloves for field service staff members.
Spin, the electric scooter startup acquired by Ford last year for nearly $100 million, has also stepped up cleaning efforts during the crisis. But it had to pause operations in all cities where it is not an essential service due to "significant demand drop-off," the company said in March.
Spin has since restarted in a few U.S. markets. The company said it will continue operating where "the city is supporting our efforts to provide a transportation option for essential purposes."
The company said that, as of April 1, all employees in paused markets and some in active markets would receive up to 12 weeks of paid leave and remain on Spin's health care for the duration of the leave.
Lime, Bird and Spin have been providing free rides to frontline workers throughout the crisis.
