The balancing scooter gathering dust in "Good Stuff" represents a once-hundred-billion-yuan industry that has now vanished | Focus Analysis

Author | Zhang Ziyi

Editor | Yuan Silai

The currently trendy "Good Stuff", the first unforgettable scene is Wang Tiemei speeding in the late night, as if she were a martial arts master riding the wind. It's not until the camera pulls back that we see the self-balancing scooter under her feet.

Standing on the self-balancing scooter, she scares away the perverted man who was stalking Xiaoye. Also standing on the self-balancing scooter, she stalks the perverted man in return. The self-balancing scooter becomes the starting point of the friendship between Xiaoye and Wang Tiemei. Xiaoye wants to learn, but Wang Tiemei refuses ruthlessly because she is going to sell the self-balancing scooter.

Being sold as idle items has become the destiny of most self-balancing scooters in China.

The self-balancing scooter was once regarded as a short-distance transportation tool to solve the "last mile" problem. The industry output value exceeded 10 billion yuan ten years ago. By 2017, the number of domestic self-balancing scooter manufacturers had increased sharply to several thousand, with more than 600 in Shenzhen alone. Representative brands include Ninebot (now: Ninebot Robotics), Chic, Inmotion, New Century, etc.

At that time, there were more than 600 vehicle manufacturers, more than 1,000 accessory enterprises, and more than 200 e-commerce companies in the domestic self-balancing scooter industry. At least 80% of the self-balancing scooters in the world are produced and exported by Chinese manufacturers. During the "Thousand-wheel War", many self-balancing scooters shuttled through the streets and alleys in China.

However, the "right of way" problem of self-balancing scooters has always been limited, and the toy positioning is difficult to change, and the vision of being a short-distance transportation tool has been shattered.

Going overseas has become the choice of many self-balancing scooter manufacturers, and "Ninebot Inc." has become one of the few winners. Nowadays, the revenue proportion of self-balancing scooters in Ninebot Inc. has been decreasing year by year, accounting for only 4% last year.

Whether in China or overseas, the self-balancing scooter market is shrinking. The new popular transportation tool overseas is e-bike, and domestic manufacturers are also flocking in; in China, the unchanged is the electric bicycle, which even helps Ninebot become a billion-dollar enterprise.

Nowadays, when searching for self-balancing scooters on Taobao, except for the toy self-balancing scooter category, it seems that only "Ninebot" is left for adult use.

01 A Transportation Tool That Cannot Be Roadworthy

It's hard not to be impressed by Wang Tiemei's cool appearance riding the self-balancing scooter. "Cool" and convenient were the important reasons why self-balancing scooters were once popular. And the last scene of the self-balancing scooter appears in Xiaoye's Taobao app on the phone.

Source: Song Jia's Weibo

If self-balancing scooters could be ridden on the road, the story of Xiaoye and Wang Tiemei might have a different development.

The self-balancing scooter appears rarely in the camera because there are clear regulations in China prohibiting the use of electric scooters and self-balancing scooters and other sliding tools on the road.

According to Article 74 of the "Regulations on the Implementation of the Road Traffic Safety Law of the People's Republic of China": "Pedestrians shall not have the following behaviors: (1) Using sliding tools such as skateboards and roller skates on the road." At present, many places including Beijing, Shanghai, Nanjing, Guangzhou, Wuhan, and Chengdu have clearly prohibited the use of electric self-balancing scooters on the road.

For users, the electric self-balancing scooter has a certain usage threshold and requires continuous adjustment of the center of gravity to maintain balance. The self-balancing scooter does not have a physical braking system and completely relies on the rider's center of gravity movement to achieve acceleration, deceleration, and steering. Its safety and stability are difficult to control, and it is very easy to cause accidents due to loss of balance.

Moreover, the electric self-balancing scooter does not belong to the responsible subjects such as motor vehicles and non-motor vehicles in China's Road Traffic Safety Law. Once an accident occurs, it is also prone to legal disputes.

Wang Ye, the founder of Ninebot Robotics, once said in an interview with the media: "From a technical and safety perspective, the self-balancing scooter technology has only reached the early trial stage and cannot be truly popularized to the general public. It is more suitable for short-distance transportation in scenarios without motor vehicles and is not suitable for users without driving experience to be used on road traffic on a large scale."

The self-balancing scooter that cannot be ridden on the road makes its vision of being a "short-distance transportation" tool an empty talk. More often, it becomes a toy that parents give to their children to ride and play in the community. The sluggish domestic market has also become a definite fact.

Going to the overseas market was once regarded as a way out by the huge self-balancing scooter industry, but it encountered the problem of patent litigation. In 2014, the American self-balancing scooter pioneer Segway sued several domestic companies in court, and the US authorities launched a "337" investigation into domestic self-balancing scooter products.

The industry was in a state of turmoil. At the end of 2015, due to the potential fire hazard, Amazon sent a notice to sellers to suspend the sale of some self-balancing scooters and required all self-balancing scooter merchants to prove that their equipment met safety standards and at the same time provide evidence that the products they sold were not infringing products, otherwise they could not be put back on the shelves.

Amazon's suspension of sales requirements has once again dealt a blow to many self-balancing scooter enterprises.

In this process, the only company that has risen is Ninebot Inc. In 2014, Xiaomi, Sequoia, and others invested 80 million US dollars in Ninebot Inc., helping Ninebot Inc. acquire Segway in a "snake swallowing an elephant" manner. Since then, it has become the global leader in self-balancing scooters, not only opening the overseas self-balancing scooter market but also solving the patent problem.

And the self-balancing scooter manufacturers who once competed fiercely with Ninebot in the self-balancing scooter field have gradually disappeared.

02 Each Generation Has Its Popular Items

The important reason for the disappearance of self-balancing scooters in China is the limited "right of way", while in the overseas market, also focusing on short-distance travel, self-balancing scooters are difficult to compete with electric scooters.

This is a dual choice of the market and enterprises. Taking the former self-balancing scooter leading enterprise Ninebot Inc. as an example, after acquiring Segway, Ninebot did not launch a large number of new self-balancing scooter products, but shifted the team's focus to the development of electric scooters.

The Ninebot Inc. team once said in a media interview that not everyone can learn how to ride a self-balancing scooter (especially when users are not sure whether a certain road condition can be safely passed, and reckless attempts may cause falls and injuries), but bicycles and scooters are things that people can use without learning; people also have a natural common sense of the "safe driving envelope" of bicycles and scooters. In addition, from a technical point of view, even when used on the road, electric scooters are faster and safer than self-balancing scooters.

More importantly, from 2017 to 2018, with the promotion of the sharing economy and the support of technology and environmental protection attributes, shared scooters quickly became a popular short-distance transportation tool in Europe and the United States. And this wave of overseas shared transportation has nothing to do with self-balancing scooters.

Source: Tianfeng Securities

TaoTao Vehicles, which focuses on the US market and is engaged in outdoor entertainment and short-distance transportation, can clearly see from its financial reports that the revenue growth rate of self-balancing scooters is significantly lower than that of electric scooters. In 2019, the revenue of electric scooters and accessories reached 140 million yuan, and the revenue of self-balancing scooters was 90 million yuan, with a small gap between the two; by 2023, the revenue of electric scooters and accessories reached 718 million yuan, ranking second in the company's revenue proportion, while the self-balancing scooter was only 296 million yuan, with a difference of more than twice.

The learning barrier of self-balancing scooters is the source of its innovation and also the ultimate reason for its market limitations. Although the market still exists, the space has already reached the ceiling.

Quick-reacting enterprises, such as Ninebot Inc., will shift from self-balancing scooters to scooters and then to electric two-wheelers.

Fortunately, although the self-balancing scooter wave once reshuffled many enterprises, it also retained an advanced and complete supply chain. The core components of short-distance travel tools such as self-balancing scooters, e-bikes, electric scooters, and electric motorcycles are the motor, electronic control, and battery (collectively referred to as the "three-electric system"). On the basis of being basically universal, the three-electric system also enables the manufacturing industry behind it to shift in time.

As for the once-popular self-balancing scooters, their final fate is mostly in the storage room or the second-hand platform. But in any case, they are still a footnote of an era. At that time, people would still be excited about a piece of hardware, and abundant funds would flow to start-up companies. The legend of Ninebot Inc. is difficult to replicate.