how they do this?

[winny]

What?! You telling me Elmo isn't real?

The the trike is RC, you can see the servo arms (copper colour) that come from the dumpster bit to the handle bar stem. His hands and feet are stuck on and his head and mouth must be RC too.

They are also cutting in shots of the proper puppet with fake handle bars (you can see them bobbing around in the elmo close ups).