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Mobility plays a vital role in the current society that we live in. With the growing concern for preserving and sustaining the environment for future generations, the governments and international organizations worldwide are enacting stringent emission norms to reduce carbon emission levels.
E-bikes are increasingly considered an ideal transportation mode as cities emerge from the quarantine approaches in the US and Europe. In addition, owing to the government restrictions on public transport because of social-distancing guidelines, commuters are essentially adopting the bike as the mode of day-to-day transportation. As a result, the rising demand for e-bikes is proving to be an ideal solution to the challenge.
Electric bikes are a flexible, versatile, eco-friendly, and trendy mode of transport. Consumers look up to them as an ideal substitute for scooters, smart cars, and public transport. These bikes help tackle traffic congestion, owing to the smaller size of e-bikes, attain higher speed with lesser effort, and health benefits attained with peddling. These factors lead to a rise in the popularity of electric bikes across the globe.
Apart from the increasing consumer preference toward recreational and adventure activities, the adoption of e-bike applications in several sectors, like logistics and e-bike rental services, is expected to drive the market towards further growth.
Compared to conventional bicycles, currently, the overall demand for e-bicycles is evolving and is expected to showcase larger growth during the forecasted period.
The ability of e-bicycles to manage the overall speeds more adequately, provides the rider with a comfortable drive on overpasses, mountain areas, and tough roads, thus paving the way to the sales of the e-bicycle market.
Factors such as the implementation of government regulations to encourage the use of electric bikes, consumer inclination toward use of e-bikes as an eco-friendly & efficient solution for commute, increase in fuel costs, and rise in interest in cycling as fitness & recreational activity are expected to drive the market growth.
However, high cost of e-bikes and ban on use of e-bikes in major cities of China hinder the market growth. Furthermore, improvement in bicycling infrastructure & battery technology is expected to offer lucrative opportunities for the electric bike market growth.
Electric bikes offer a relaxed cycling trip to/fro work, easier usability compared to bicycles, cheaper transport compared to public transport, cheaper running expenses compared to a car, all while decreasing emissions and keeping the rider healthy
Connected electric bikes – there are many ongoing technical advancements in the e-bike market, one of which is connected e-bike technology. The technology is enabled with an embedded sim module that sends and receives data to and from a cloud server without the need for a smartphone. Some of the most prominent features this technology offers are automatic emergency calls, social media connections, integrated navigation, remote diagnosis as well an anti-theft system.
For instance, the company Bosch has developed connected e-bike solutions which it has been selling to the automakers. The SmartphoneHub developed by the company connected electric bikes to the rider’s smartphone to support the rider’s journey. For greater security, the Kiox connected onboard computer system is transferred into a key by the Lock Premium feature. The Nyon function determines the force of the pedal as well as the frequency and uses the information to calculate the rider’s energy consumption and performance.
Electric cargo bikes offer a quieter and cleaner alternative to vans for making deliveries in urban areas. And as cities turn over more road space to bicycles, motorcyclists may be tempted to switch. Manufacturers like Triumph Motorcycles and Piaggio now offer e-bikes alongside their motorized two-wheelers.
However, just as the shift to battery-powered cars opened the door for new players like Tesla, upstarts are staking their claim in the e-bike market. While most conventional bicycles are assembled using mass-produced parts, new manufacturers are building batteries into frames, while adding features such as electric alarms and smartphone controls.
In a sign of the industry’s potential, German industrial giant Robert Bosch earlier this year created a new standalone unit that makes batteries and other parts like anti-lock brakes for e-bikes.
Major brands have invested in R&D as well as manufacturing for e-bikes across the globe. Players such as Yamaha and Bosch have also set up component supply chains for global brands and also boosted their ability to provide solutions for e-bikes.
The bicycle market is segmented by
By Sub Component
Covid-19 has provided a further spark. E-bikes appeal to commuters who are keen to avoid public transport, but don’t want to appear sweaty at work. Most riders who ride e-bikes to/from work don’t want to carry a change of clothes either which increases the demand for commuter e-bikes.
Governments, spotting an opportunity to reduce carbon emissions, are helping too. Cities like London, New York and Berlin have built new bike lanes, while several countries have offered subsidies. Italy is reimbursing citizens for as much as 60% of the cost of a new bicycle, e-bike or e-scooter, up to 500 euros. Electric power also stimulated the use of shared-bike schemes, like those operated by Uber Technologies-owned Jump.
Customers in the US and Europe are turning to electric bicycles in a very big way Covid was the primary driver of the boom. The average prices in this area are 3-4x more than China and the rest of Asia due to the higher purchasing power in this region. It’s also a preferable option for those looking to socially isolate while getting fresh air outside.
Due to the COVID-19 pandemic, the shortage in the semiconductor components and electronic chips has greatly affected the automotive industry and trends for new innovations and technology launches. For instance, the Accell group reported that the bicycle sales declined by 15.4% due to component shortage and limited alternatives for critical parts.
Graph: Average price in USA for different E-bike types
USA depended on Chinese imports for the growth of e-bikes especially among the startups such as Rad bikes.By 2019, a large chunk of imports shifted away from very few companies who sold primarily through Amazon under various brands. Instead, a large portion of overall imports is now going to consumer-direct e-bike specialists, brick and mortar e-bike specialists (EBDs), and conventional bicycle brands.
US e-Bike Imports reached Record Levels in 2020. Despite concerns over Trump’s tariffs and huge disruption to e-bike supply chains caused by coronavirus and the trade war instilled between US and China, which is one of the leading manufacturers of bicycles and bicycles parts. The $1,500-$3,000 price point is seeing excellent traction across all major E-bike retail points
Because e-bike sales started surging last year, large e-bike companies have been managing a delicate balancing act between their sales and customer service departments. Now, as an unprecedented number of new customers receive their e-bikes boxes, some of which inevitably arrive with issues, these companies are finding it difficult to keep their many new customers happy.
The United States Congress has proposed a tax credit against the purchase of electric bicycles in the USA which will be up to 15% that is half of what was presented to the House of Representatives in February 2021. The original document pitched a tax credit of 30% as an incentive to buy more electric bikes and bicycles.
Market-visible companies, such as VanMoof and Rad Power Bikes, found themselves scrambling to keep up with their new customer bases and the rapid increase of complaints. After its sales doubled virtually overnight, VanMoof especially found its very prominent presence on social media a handicap as its splashy ads on social platforms were always accompanied by a long list of customers publicly complaining about a lack of customer support.
E-scooter companies have long complained about not being allowed to operate in the largest U.S. city, with more than eight million residents, while permitted in dozens of other U.S. cities.
However, new amendments have been announced along with a pilot program for the e-bike market which is scheduled to start by May 2021 and is expected to last no more than two years, according to the bill. Scooter placement should focus on areas underserved by the city’s docked bike-share program. The relative ease in state policies is only expected to drive this market further towards growth. Firms such as Lime have started e-bike sharing programs and the response to that with competition from e-scooters must be closely followed
Graph: Average price in China for different E-bike types
Asia-Pacific dominates the e-bike market as China and Taiwan are the largest manufacturer and exporter of e-bikes in the region and e-bikes purchased are increased in the region for cost-effective and eco-friendly commuting for short distances, for instance, commuting to workplace or office.
The import and export volumes in China are also large, and China has always been the largest exporter of electric bikes. The Government of India has also encouraged to use electric bikes. By the end of 2035, the government is looking forward to convert fuel vehicles into electric vehicles. The most prominent features of China’s E-bikes are the regional characteristics. Currently, Tianjin, Jiangsu and Zhejiang are the major e-bike industrial clusters in China.
The company Hebei Hongyang Tyre exported a total of 16.19 million bicycles in the first quarter of the year 2021, which increased the export volume to $1.06 billion which was up by 101.6% from year-on-year comparison.
Recently electric bicycles are gaining popularity across Asia especially in China among younger generations who use bicycles as a healthy activity. Electric bikes are equipped with smart batteries and linked to applications that make them easily accessible. The primary bike-sharing companies such as Hellobike, Meituan bike, and Qingju Bike have increased the demand for e-bikes in the Chinese market.
Hero bicycles, one of the global leaders have invested Rs 500 Cr to develop their brand and cycles specifically for Europe. This will trickle down to the Indian market
Bosch set up their global R&D for e-bikes in Taiwan and belive that pedal assisted bikes will show the largest growth in Asia Pacific region compared to other regions
To know more about Asia Pacific E- Bike Market, read our report
Electric bike sales now represent 17% of all complete bicycles sales made in Europe. In pooling a broad spectrum of data from across the EU, it was found that electric bike sales are achieving a growth rate far steeper than that of electric car sales; in fact, electric cargo bikes sold more than electric cars in Germany in 2020.
As far as sales trends go, 60% of electric bike sales at the checkout in Europe are also largely made in the EU. In Germany in the first half of 2020 the bike boom saw sales of bicycles, sports and camping goods beat the market, with retail sales up 1% and car sales down 18%.
EU e-bike imports increased by 10% to meet the expanding market from 46 % in 2019 to 51 % last year. Germany, The Netherlands and France are the key markets for the e-bike market in Europe.
In the UK, Sales of bikes selling between $550 and $1,350) more than doubled in April 2020 compared to April 2019. Overall, bike sales rose by 60% YOY by volume and 57% by value
The bicycle market in Europe will possess the second-largest share in the forecast period. The rollout of infrastructure for encouraging and supporting bicycle commutation in Belgium, France, Denmark, and Italy, rising health consciousness, increasing environmental concerns regarding carbon dioxide emissions, rising urbanization, growing use of personal transportation, traffic congestion, popular bicycling events, and the presence of cities that are ideal for bicycle commutation are adding to the global bicycle market growth in the region.
Europe is estimated as the ideal region to commute with bicycles due to which the region is experiencing significant growth over the years. The increasing popularity in the region is also attributed to the bicycling events and tours that take places such as the Ronde Van Vlaanderen and the Tour de France. Countries such as Denmark, Belgium, Italy, and France are focusing more on developing infrastructure for electric bicycles and bikes which promote the growth of the industry.
New Phoenix-models such as the Lithium moped bicycles have become increasingly popular across Europe as the bicycle addresses the concerns of people owning a luxury bike to go out in public as well as remain healthy at the same time.
Additional factors adding market growth include rising use of bicycles for its convenience as a form of physical exercise which lets people remain fit, growing use of bicycles for recreational activities, the growing popularity of e-bike tourism, on-going trends of adventure sports, and rising health consciousness are also adding market growth.
To know more about Europe E-Bike Market, read our report
June 2020- The British motorcycle brand Triumph unveiled its first e-bike, an aluminum-frame model that will retail for about $3,750
July 2018– Yamaha introduced 600Wh multi-location in tube battery, for Electrically Power Assisted Bicycles (EPACs), which offer a 20% capacity increase.
March 2018- Accell Group acquired the US-based Beeline Bikes. Beeline Bikes is a mobile bike service company that delivers a turn-key sales, service, and data collection solutions personalized for Independent Bicycle Dealers (IBDs) in North America based on a franchise concept.
September 2017– Bosch e-bike system took over a start-up based in Frankfurt named COBI.
November 2016– Giant Bicycle continued its partnership with Cycling Development Foundation (CDF), which is a joint commitment to support the cycling development in Western Australia.
Table: Top e-bike conversion kits
The global E-bike market is estimated at $ 12 B in 2020, growing at double digits till 2026.
Electric bikes are giving the market for two-wheeled transport a big jolt. The pandemic that has boosted demand for bicycles also looks set to accelerate the shift to battery-assisted pedalling. As in the automobile market, though, the change is disruptive. Established players will have to make room for new upstarts.
Sustainability credentials have progressively become an important part of doing business, as well as when selling on to the consumer, who will now pay a premium for genuine eco-credentials.
Modern technology requires modern solutions and so issues like the recycling of e-bike batteries are now frequently brought up. With Decathlon announcing a circular economy drive and OEM parts maker Herrmans offering a sustainable packaging service to its clients, the trend is now deep seated.
The e-bike market is extremely fragmented, with the major players holding a low share of the total market share. Some of the major market players are Giant Bicycles, Merida, Trek Bikes, Riese & Muller, and Fritzmeier Systems GmbH & Co. Kg (M1 Sporttechnik).
The Dutch electric bike manufacturer VanMoof announced the acquisition of investment worth $128 million in the Series C minority investment round which was led by an equity firm based in Asia. The investment has raised the total funding of the company to $182 million which will be used in the expansion of production activities and enhance the software and hardware infrastructure of the bicycles.
The company Accell Group recently released the financial reports for the first half of the year 2021 with net sales worth EUR 699.1 million which was greater than the net sales from the same term of the year 2020 which reported EUR 676.9 million.
The major developers are focusing on expanding their business by acquiring small companies. For instance, Hero cycles acquired 48% equity in HNF NICOLAI which is a vehicle manufacturer based in Germany. The acquisition is set to help Hero to expand to global markets primarily through Europe. The company Van Der Wal was acquired by Beeren Groep NV which is an automotive supplier manufacturing company based in Belgium. Peloton Interactive revenue in the last quarter grew 54% as compared to the quarter of the year 2020, to revenue worth $937 million.
Giant Bicycles is expected to be the largest player in this market.
The company’s presence is majorly concentrated in China, with Europe and North America being the other important markets. The companies are diversifying their product portfolio through innovations and new launches and is aiming to continue its spot as the market leader.
The new players are also attracting different investors. In May, VanMoof raised 12.5 million euros from venture capital firm Balderton and Taiwan’s SINBON Electronics. Belgian startup Cowboy’s backers include Tiger Global Management and Index Ventures.
Accell, the $730 million Dutch group which owns brands such as Raleigh and Sparta, earned more than half its revenue from e-bikes last year. Investors are betting that will continue. Giant shares have risen 43% so far this year, and are now valued at 26 times Daiwa Capital Markets’ forecast earnings for 2021. Shimano, the $19 billion Japanese group that controls roughly half the global market for bicycle components like gears and brakes, trades on a forward multiple of 35 times
Giant Manufacturing, the $4 billion Taiwanese group, saw revenue jump 55% year-on-year in June. British retailer Halfords reported a similar-sized spike in its cycling business in the 13 weeks to early July
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