Vanmoof’s bankruptcy is rocking the mobility industry. The case also shows that not every product has to be digitized.
VanMoof bikes only work with an app. VanMoof
The Dutch e-bike manufacturer Vanmoof has gone bankrupt. No surprise: the company has been struggling with financial problems for years. In 2021 alone, Vanmoof posted a loss of around 80% Million Euros. At the end of 2022, the startup was only able to stay afloat because investors put money into the company again. Then, in early July, they missed an interest payment and bankruptcy was inevitable. The imbalance now has devastating consequences, especially for customers.
The basic functions of the Dutch e-bikes are heavily dependent on the app. Even the light is controlled by it. Even worse is that the lock is linked to the app. Activation takes place using a security key that is stored on the company’s servers. If these are now switched off as a result of the bankruptcy, the wheel can no longer be unlocked. Meanwhile, the competitor Cowboy developed an app, which allows Vanmoof customers to back up their security key. But this is only possible with certain models.
Bikes don’t need apps
Every buyer has to decide for themselves whether a comparatively trivial product like a bicycle needs to be digitized in such a way that it becomes practically useless without a network connection. Of course, being able to control everything with your smartphone has advantages. But bicycles in particular should function simply and easily – even in the event of a power failure or a shut down server.
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We’re all used to buying expensive hardware that requires companion apps, either to access the full functionality or to be able to use it at all. This is the norm in smart home devices. Example of intelligent loudspeakers: A companion app is usually required here, for example to set an equalizer or to connect several devices with each other. In some cases, a companion app can work perfectly in standalone mode, but it’s surprising how often a server connection is required for full functionality.
Cars are also becoming more dependent
This also applies to the auto industry. The manufacturers from Germany give customers different security guarantees for updates, but the general trend is that support is promised between ten and twelve years. This does not necessarily apply to the introduction of new functions, but only to security updates. That will be enough for most used car buyers. And more is not possible, because the costs for such a long support time for manufacturers are enormously high.
Buyers who have bought a vehicle from Vietnamese automaker Vinfast, for example, will also be nervous about the company’s losses. These were 540 million euros in the first quarter of 2023 alone. In addition, an important donor left in February. How long the state intends to keep the company afloat is unclear.
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Conclusion: Digital features are an important selling point for customers. But the Vanmoof bankruptcy shows that the (too) close integration of products with the Internet can become a trap. It is also questionable what contribution highly digitized e-bikes will make to the traffic turnaround. E-bikes are undoubtedly an important pillar of future mobility. However, simple means of transport such as a bicycle work best if they remain technically simple.
Don Dahlmann has been a journalist for over 25 years and has been in the automotive industry for over ten years. Every Monday you can read his column “Torque” here, which takes a critical look at the mobility industry.