Biking Hot

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The tragic urban crisis of ebike explosions

Firefighters fear many nightmares, and a blazing ebike store might be among the most petrifying. Unlike typical building fires, which usually have a paced velocity and spread as they climb up through a building’s structure, the lithium-ion batteries of ebikes and electric scooters are explosive — and a whole flotilla of them in close quarters can cause a rapid chain reaction of fiery, blasting flame.

That’s precisely the scene that the FDNY encountered earlier this week in Manhattan’s Chinatown, where a lithium-ion battery caught fire in a first-floor ebike store, with several floors of inhabited apartments nestled on top. 140 firefighters hit the scene after midnight, but no amount of water or heroics could fight back the chemical burn. Four people died in the nighttime inferno.

Electric-powered bikes, scooters and other personal transportation devices have skyrocketed in popularity across New York City, both statistically and visually as any pedestrian crossing a Manhattan street knows. But that popularity has also led to a fiery and infuriating toll: as the New York Post described earlier this month, “Lithium-ion batteries from e-bikes and similar devices have fueled 92 fires, injured 64 people, and caused nine deaths so far this year – almost as many as the 10 fatalities in 2022 and 2021 combined, FDNY data show” (and that was before this week’s catastrophe). The City Council has passed new regulations on ebike dealers, and many landlords in the city now outright ban the devices.

This ghastly story of the rise and explosive fall of the ebike in New York City is a parable of America’s febrile strategy on consumer protection and technology, as well as the expensive economic consequences that our milquetoast approach costs.

The success of ebikes is a testament to infrastructure evolution as well as the long-term consequences of our new patterns of post-pandemic living. As Bloomberg writes in a retrospective about the mayoralty of, well, Michael Bloomberg (there is no conflict without interest!):

Those observations are representative of a citywide transformation: New York City has built nearly 400 miles of new and improved bike lanes since the mid-2000s, which, with the launch of bike sharing, helped quadruple ridership. Although Manhattan and Brooklyn have received the most attention, other boroughs are receiving major cycling investments, too (even when community members oppose it). The $100 million overhaul to Queens’ “Boulevard of Death,” for example, is “the kind of thing I never thought I would see in my lifetime,” writes [Clarence Eckerson].

That expansion of dedicated biking infrastructure lined up perfectly with the rise of delivery apps like DoorDash, Postmates and Uber Eats as well as the scaled up manufacturing of ebikes from China. The statistics, as always from China, bewilder. Bloomberg noted in mid-2021 that:

The number of electric-bike makers in China underscores the sector’s potential. There were around 51,600 e-bike manufacturers registered in China in 2020, up 83% from 2019, government data show. And 223,000 companies were in businesses related to the electric-bike industry as of February. Investors have cottoned on. Shares of Yadea, a Shanghai-based, Hong Kong-listed company that designs and makes electric scooters and bikes, have risen almost 815% over the past 12 months; Jiangsu-based Ezgo Technologies, which is listed on Nasdaq and which makes e-bikes with lithium batteries, soared 350% in its trading debut in January.

One industry publication posted numbers that “Production of e-bikes employing lithium batteries reached 4.98 million units in 2019, passed the 10 million unit mark in 2020, and surpassed 12 million units in 2021, at which time e-bikes with lithium batteries accounted for 28.5% of China’s overall e-bike output.”

The key to this massive industry expansion was price. Ebikes got cheap — very cheap, and increasingly, too cheap.

Riders can buy quality ebikes today in the $1,000-$2,000 range, but that’s for properly tested machines. There is a grayer market of ebikes and electronic scooters that don’t go through battery testing (or really any quality control at all), where prices can descend to as low as a few hundred dollars. You can see these prices online at AliExpress plus retailers in cities like New York who specialize in this market.

This is the combustible mix that has turned one of the great urban transformations of the past decade into a case study of death and despair. There are now thousands of poorly-made bikes and scooters sitting in apartment garages and in people’s foyers. The risk of an explosion from any single one of them is of course low, but the aggregate risk is high. After hundreds of fires the past few years, people are taking action.

First was the New York City Council, whose regulatory approach is to mandate the sale of bikes that meet safety standards from UL, and punishing retailers with fines if they sell products that aren’t compliant. That’s a thoughtful and somewhat enforceable law, but it doesn’t actually prevent consumers from buying ebikes online. As the trade publication Bicycle Retailer notes:

The legislation does not outlaw owning or using a non-certified e-bike, so while it may shut down some retailers, the users of low-priced non-certified e-bikes can still go out of state to buy the bikes and batteries. It’s also unclear how the city could regulate online D2C sales.

That fecklessness leads to the urban tragedy: landlords are now taking their own actions by entirely banning all electric vehicles. As I was traveling in Japan last month, my landlord sent out an emergency notice demanding that all ebikes and scooters be removed from the building within a week. Failure to do so would result in the veiled threat of eviction under active danger clauses in the lease contract.

There are no exceptions to this policy. It doesn’t matter if an ebike is tested, regulated or safety checked — the whole category is being tossed. My landlord (which happens to be one of the largest in NYC) isn’t unique. Landlords across the city are banning any form of electric transport, since building insurance policies are increasingly taking into account the risk of fire and structural damage and adjusting underwriting rates accordingly. Banning the whole category just makes sound business sense, even beyond mitigating fire danger.

Properly built and tested ebikes are safe. They are plentifully available, and easy to find. They are transformative for commuters and shoppers, and solve the last-mile problem of urban transportation beautifully while improving the climate to boot. The tragedy is that those gains are seriously at risk, and it appears we will have a set of restrictions stamped for a generation that will permanently ban these vehicles due to shoddy products that spoiled the market for all.

Frustratingly, the industry itself has in most cases been supportive of improved safety standards. Exploding bikes is bad for business, and a floor on safety standards would broadly buttress the long-term growth of the ebike sector. Now, the industry is scrambling to prevent building-by-building bans that will force consumers to pause and assess whether they should make an investment in a vehicle that they might suddenly not be allowed to own.

From Bicycle Retailer again:

Charlie McCorkell, owner of the three-store chain Bicycle Habitat, found selling e-bikes in the city a challenge even before the City Council’s latest move. Landlords have banned him from having e-bikes or batteries in some of his stores and storage spaces because of perceived fire danger. He said some of his long-term customers are wary of e-bikes because of fire danger and/or because their landlords don’t allow the bikes in their homes. E-bikes currently account for about 7% of Bicycle Habitat’s business. He sells brands including Specialized, Giant, Yuba and Civia.

He later goes straight to the right solution: “McCorkell said that to improve fire safety in the city, the federal government will need to enforce safety regulations at the import level.”

The United States is notoriously weak on consumer safety standards, with a legal and political system heavily influenced by corporate lobbying, and a general ethos of libertarianism that places the burden of vetting a product’s safety on the consumer themselves. But incredibly, we are willing to cede the growth of an entire industry just because we aren’t willing to enforce a modicum of simple safety rules on cheap imports.

Ebikes are the crisis today, but what’s happening here is a pattern that comes up often with new technology. There’s a balance to be struck between immediate safety and open product innovation. Killing consumers is no way for a nascent industry to thrive under the wrath of politicians. Freedom from regulation may accelerate an industry for a time, but the long-term damage is severe. That’s the nightmare for any executive, and at least in New York these days, every firefighter patrolling the streets.

Lux and Hugging Face testify before Congress on the future of artificial intelligence

Screen capture of U.S. House committee livestream
Screen capture of U.S. House committee livestream

AI is the talk of Washington these days, and not unlike ebikes, it is an industry poised to have a transformative effect on society even as concerns around safety are omnipresent. Congress is looking to develop a flexible but solid regulatory framework for ameliorating the worst drawbacks of AI while leaving the market open for rapid innovation.

To that end, our own Shahin Farshchi and Lux portfolio company CEO Clem Delangue of Hugging Face testified this week in front of the U.S. House committee on Science, Space and Technology as part of a wider panel that included Jason Matheny, the president and CEO of RAND, Rumman Chowdhury at Harvard and Dewey Murdick, the executive director of the influential Center for Security and Emerging Technologies at Georgetown.

I watched the hearing, and questions ranged widely from autonomous vehicles to concerns about a race with China to whether large tech companies will dominance the market. Positively, Congress seems to have a decent handle on AI, understanding the need for the industry to hastily evolve in the years ahead while desiring to imprint products with core American values.

🎬 Watch the full hearing on YouTube

Lux Recommends

  • Matthew Lynley’s new edition of Supervised has a great overview of MosaicML’s new AI foundation model MPT-30B, which chief scientist Jonathan Frankle described as improving open-source AI for enterprise use cases. Lynley also noted Enveda’s launch of its new AI model MS2Mol, which will help scientists translate mass spectrometry inputs into chemical structures.
  • On the subject of AI (everything is really AI these days), our scientist-in-residence Sam Arbesman highlights Douglas Hofstadter’s argument in The Atlantic on “Generative AI Should Not Replace Thinking at My University.” "I’m sorry, but I can’t imagine the cowardly, cowed, and counterfeit-embracing mentality that it would take for a thinking human being to ask such a system to write in their place, say, an email to a colleague in distress, or an essay setting forth original ideas, or even a paragraph or a single sentence thereof. Such a concession would be like intentionally lying down and inviting machines to walk all over you.”
  • Our summer associate Koko Xu is excited about quantum computing after a group of researchers published positive results in Nature on “Evidence for the utility of quantum computing before fault tolerance,” in which they argue, “These experiments demonstrate a foundational tool for the realization of near-term quantum applications.”
  • There’s been a bevy of articles on North Korea the last few weeks that I have found striking. First up, Matt Burgess wrote an excellent piece in Wired on “The Bizarre Reality of Getting Online in North Korea.” “‘Every five minutes, the screen freezes automatically, and the librarian must do a fingerprint authentication to allow further internet use.’ A state security officer was also always nearby, they said.” Meanwhile, Reuters has an excellent visual depiction of the changing nature of North Korean emigration, where new border walls have slowed the torrent of defectors down to a trickle: just 67 last year. Finally, a great, complex "Securities” tale from the Wall Street Journal on “How North Korea’s Hacker Army Stole $3 Billion in Crypto, Funding Nuclear Program.”
  • Koko recommends a data analysis from Snap on early user requests to its AI chatbot. “Approximately 4 million conversations looking for tips on playing guitar and writing songs.”
  • Finally, Sam recommends Étienne Fortier-Dubois’s essay, “We Rarely Lose Technology.” "When technology is truly lost, as in a minority of the cases above, it is usually because we don’t care.” Greek Fire may indeed be gone, but there's always a lithium-ion battery at hand.

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