Dive Brief:

• Lime has recalled some of its scooters due to concerns that a manufacturing defect could cause some batteries to catch fire. The mobility company received reports of "the battery smoldering or, in some cases, catching fire" on certain scooters.
• Lime, along with scooter manufacturer Segway Ninebot, created software to detect the potentially defective batteries and pulled those scooters from service.
• Lime learned of the problem in August and pulled scooters in the Los Angeles, San Diego and Lake Tahoe, NV markets, saying the defect "has impacted less than 0.01% of our scooter fleet," which The Washington Post reports is about 2,000 devices. Lime says it is looking into an unconfirmed report that another of its Segway Ninebot scooter models might also have a battery issue.

Dive Insight:

Manufacturing defects and business challenges happen all the time, and a company's continued success often lies within the finesse of putting out a solution. Things could have gone far worse for Lime, but the optics on this particular situation aren't the greatest.

The company reports knowing about the problem since August, but the public didn't find out until this week. The Washington Post claims that Lime only put out the public statement this week as a response to the publication's questions about scooter fires. Luckily, nobody was hurt in the handful of incidents in which scooters smoldered or caught fire. 

It does appear that Lime moved quickly to resolve the problem. It put in place some additional safety measures to avoid future battery-related fires, including charging all Segway Ninebot scooters only at Lime storage facilities, staffing the storage facilities 24/7 with employees specially trained to handle the batteries and initiating a new daily testing regimen for all scooter batteries.

This situation actually could end up more negatively affecting Segway than Lime. Segway has been quiet about Lime's announcement of pulling its scooters, and about another of its models potentially having battery-related issues. Silence often makes situations worse for companies if the public perceives a lack of concern over a problem that could be dangerous, but Segway might choose to release a statement in the coming days. In addition, mobility businesses other than Lime have Segway scooters in their fleets, so attention to Lime's battery concerns could cause a ripple effect throughout the entire e-scooter industry. Neither Lime nor other companies have indicated that they would stop using the Segway scooters altogether.