Ryan Avent faults regulation:
Products intended to power people along roads must satisfy a host of federal, state, and local regulations pertaining to safety, operational capabilities, and so on. With any new product, there would be immediate questions about what sort of licensing requirements would be necessary: who can use it, do they need a special certification, will insurance cover this operation, and so on. Basically, use of the roads by powered vehicles is a highly specified realm; only certain kinds of vehicles can legally do it, meeting certain design requirements, operated by people with certain certifications.
All of these rules have been put in place for good reasons, but they’re deadly to innovation.
There is simply no place on the road for broad experimentation and competition between innovative designs. Because of this, it’s far from clear that any new vehicle technology could have the potential financial upside of an iPhone, and so many potential innovators stay away. Getting a product street legal could take years of grinding and expensive legislative and legal work, and it wouldn’t do consumers much good if the process had to be repeated by subsequent market entrants, since its competition that will produce the desired improvements in personal transportation.