Scooter Sharing Market in India 2021-2026

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    INTRODUCTION

    Scooters have played an important part in mobilizing India. Be it geared scooters in 1980s-early 2000s or the gearless one’s post 2005 or now in 2019-the shared scooters. India is the biggest ICE(Internal combustion engine) powered two-wheeler market globally, selling ~20 Million units in 2018 and ~35% of them are gearless scooters.

     

     

    WHAT PROBLEM(s) ARE THEY TRYING TO SOLVE?

    India, despite being the world`s biggest two-wheeler market, is still an underpenetrated market, at ~125 two-wheelers per 1,000 inhabitants. The ownership ratio also varies per region and there are migrant workers/college students, who relocate for study/work opportunities in tier-1 cities for short/medium term and are hesitant to own a vehicle due to various reasons.

     

    This set of users either use public transport or on-demand taxi for daily commute and shared scooters cost less than an on-demand taxi and sometimes even less than public transport as detailed below.

     

     

    MARKET DYNAMICS

    The two-wheeler sharing market in India is estimated to grow at the CAGR of XX% and reach $XX billion by the year 2025. The market is mainly concentrated on startups which require a lot of funding and investments. 

     

    Due to the increasing number of vehicles such as buses, private cars, rickshaws as well as two wheelers on the roads, the country is facing the issue of congestion. The condition is worse in urban metro cities such as Delhi, Mumbai, Bengaluru and many more, this has increased the travel time for commuters. To resolve the issue these sharing companies are experiencing growth as they require less space on the roads and are convenient for shorter distances. 

     

    The government is actively providing incentives as well as subsidies to adopt electric vehicles over conventional ICE vehicles. This provides major growth in the two-wheeler market as companies such as Ola electric and Ather Energy are developing electric two-wheelers which will further facilitate the growth of the sharing market. Electric two-wheelers and bicycles will help in reducing carbon emissions and will facilitate the demand for self-drive electric scooters for last mile connectivity.

     

     

    RIDE CHARGES COMPARISON OF SCOOTER SHARING OPERATORS IN INDIA FOR A 5KM RIDE

     

    Sl no Operator Unlock charges INR($) Price per km

    INR($)

    Time charges per Minute INR($) Estimated charges for a 5km ride INR($) Savings when compared to a budget on-demand taxi*

    INR($)

    1 Bounce No charges 6(0.08) 1.5(0.02) 32(0.42) 52(0.69)
    2 Vogo No charges 3.5(0.046) 1.20(0.016) 31(0.41) 50(0.66)
    3 Zypp 3(0.04) No charges 2(0.02) 43(0.57) 37(0.49)

                                            Source: Official apps ride cost estimator

      *Considering a 5km budget ride in an on-demand taxi costs INR 85($1.2)

     

     COVID-19 IMPACT ON SCOOTER SHARING MARKET IN INDIA

    The COVID-19 pandemic has disrupted all the manufacturing and travelling activities across the globe due to the lockdowns and restrictions put in place in order to limit the spread of the virus. Among other sectors hit by the pandemic the automotive and mobility sectors have also taken a hit in some of the departments.

     

    While some industries took a plunge due to the pandemic, several others flourished, along with the vehicles that were used for last-mile delivery services due to increased activity in food delivery and e-commerce. The bike as taxi business because of less customers due to the lockdown started to partner with the grocery and retail store giants as well as the state governments to facilitate the delivery of essentials such as grocery, medicine and food. 

     

    As countries across the globe have started to phase out the unlock procedures, industries are starting to recover. However, some companies are still functioning on a work from home basis to control the infection rates. With public transport not working to a full capacity, the demand for mobility service companies has grown to offer alternative safe means of transportation. The two-wheeler sharing market with its accessibility as well as economicity is estimated to grow at a fast pace.

     

     

    RECENT MARKET TREND IN THE INDIAN SCOOTER SHARING MARKET

    The sharing market in India has crossed the mark of the highest number of scooter rental apps in the world. India currently has 20,000 active two-wheeler rental application users. The city Bengaluru has become the scooter sharing capital of the country.

     

    Bounce has reduced the number of employees by 200 in the second round of layoffs during February of the year 2021 due to the COVID-19 pandemic and the expenditure in the expansion of its fleet to other cities. The company announced the addition of 4000 more electric scooters to its fleet in Bengaluru and Hyderabad. The company has also placed the order of 3,000 electric scooters from the company Ampere Electric as part of the initial rollout in the partnership with Ampere. The company has also partnered with CredR to provide users with long-term subscriptions and rentals.

     

    In May 2020, Bangalore based e-scooter manufacturer Ather Energy partnered with Bounce, according to this Ather 450 model owners will be allowed to list their vehicle on Bounce app and any Bounce user can rent it.

     

    Yulu has already expanded into cities like Delhi, Mumbai as well as Ahmedabad. It has recently partnered in July of 2021 with food delivery giants to deploy approximately 10,000 Yulu DEX across the cities Mumbai, Bengaluru and Delhi as part of the short-mile delivery program; it will be initiated by December 2021. The company also announced the expansion of its fleet from 10,000 to 50,000 units by the end of the year 2021, with Bajaj Auto’s electric scooter joining the fleet.

     

    POSSIBLE EXPANSION IN OTHER TIER-1/2 CITIES?

    As we have observed after multiple studies on bike and scooter sharing market worldwide that some of the key factors for sharing economy expansion are 1. High population density 2. Resistance to personal asset ownership 3. High smartphone penetration.In India, all the three factors hold good for 8 tier-1 cities and a few tier-2 cities but definitely not in tier-3 cities which are more than 100 in number.

     

    Our other Bike and Scooter sharing reports

    E-Scooter Sharing Market in US and Europe

    Bike sharing Market in US and Europe

    Scooter Sharing Market in Asia

    Global Micromobility Market

     

    COMPETITIVE LANDSCAPE

    As of August 2021, the scooter sharing market in India is dominated by two startups i.e. Bounce (owned by Wicked ride adventure) and Vogo. Both have been competing relentlessly in the IT city of India- Bangalore.

     

    The difference lies in their sharing model. Vogo is a station-based sharing marketplace whereas Bounce has a station less/dock-less model.

     

    Both models have their own advantages/disadvantages, where station-based rentals assure better fleet management and safety, consumers are also tempted towards floating scooter share where they can get on/off their ride anywhere, adding to convenience and flexibility. But, dockless sharing has resulted in theft, vandalism and higher maintenance costs not just in India but across the globe. Read our scooter sharing report to know more about it.

     

    In the year 2019 and 2020 venture capitalists and equity partners started to focus more on the mobility startup companies. The companies Ather Energy, Yulu and Vogo raised significant funding during their investment rounds, the company Bounce in January 2020 completed its funding round with a whopping $105 million.

     

    Bounce Rental which is a subsidiary of Wicked Ride Adventure Services reported revenue of INR 87.54 crore in the fiscal year 2020 which was significantly greater than the revenue for the previous year 2019 which was INR 13.88 crore. However, in spite of the increased revenue the company’s expenditure to achieve annual filing and its topline has exceeded the revenue earned by the company. It also started selling accessories and products such as helmets, safety kits, electric power packs and many more which contributed to about 1.3% of the operating revenue. The company also introduced swapping battery type electric scooters by the end of 2019. The service has put an additional strain on the infrastructure costs in the amount of INR 90.1 crore during the year 2020.

     

    Ather Energy reported a revenue of approximately INR 48.8 crore during the fiscal year 2020 which was a significant four fold increase from the revenue of INR 11.7 crore in the year 2019. The company has spent huge amounts of money in the procurement of electronic components and semiconductors for the production of the Ather 450x amid the semiconductor shortage worldwide.

     

    Yulu has reported a revenue worth INR 11.3 crore for the fiscal year 2020 which has also reported an increase from the fiscal year 2019 which reported revenue worth INR 1.80 crore. The company has been spending huge amounts of money to expand into cities like Delhi, Mumbai as well as Ahmedabad, which has caused the company to spend more and earn less. The company also raised funding worth INR 30 crore in the round led by Rocketship and the existing investors in the year June 2020.

     

    In May of 2019, Uber which is one of the premier taxi and sharing service providers partnered with Yulu Bikes to provide bicycle sharing service for its customers.

     

    FUNDING TIMELINE

    In June 2019, WickedRide Adventure Services, renamed as Bounce, raised $72 million worth of funds, the funding round was led by the Falcon Edge Capital as well as the B Capital group. The investment will mainly focus on expanding the operations of the scooter rental company into new cities in the future. The company in the year 2020 also raised approximately $105 million in the funding round D which was led by B Capital and Accel Partners. With the completion of this round, the company now stands with a total funding of over $194 million with plans to build the company’s own electric fleet.

     

    Vogo Automotive in the early months of the year 2020, raised an amount worth $3.7 million in funds, the funding round was led by Alteria Capital Advisors LLP. The company is expected to sanction these funds in the development of the two wheeler sharing/rental service across the country.

     

    Rapido which is a two-wheeler e-hailing provider raised funds worth $11.2 million as a part of its funding round in series A, the round was led by Nexus Venture partners. The funds will be used to expand the operations of the company in the new cities across the country.

     

    Yulu is aiming to raise funding worth $40 million in the next round as a part of its expansion. The company has already increased its fleet from 4,000 vehicles to 10,000

     

    FUNDING TIMELINE

    Funding raised by Bounce and Vogo timeline, also includes month and year

     

    COMPANY PROFILES
    1. Vogo Automotive Pvt Limited
    2. Bounce rental(Wicked Ride Adventure Services Private Limited)
    3. Zypp(Mobycy)
    4. Zoom car India Pvt Limited
    5. Smartbike
    6. WheelStreet
    7. ZipHop Technologies.
    8. Drivezy India Travels
    9. OLA bikes
    10. ONN Bikes
    11. Yulu

     

     

    THIS REPORT WILL ANSWER THE FOLLOWING QUESTIONS
    1. Market Size and Forecast for 2021-2026
    2. The path to profitability for operators
    3. Who are the users and why do they choose scooter sharing over other commuting options?
    4. The difference in cost borne by a user in a month while commuting on a shared scooter v/s a monthly rental scooter?
    5. User acquisition cost,Scooter repairing and maintenance cost of operators
    6. Potential for Electric scooter deployment and growth
    7. Is there a potential opportunity for electric kick scooter sharing market in India?
    8. Opportunity for IOT sensor, GPS tracker , fleet management,scooter manufacturers and software vendors in this market
    9. Risks in the scooter sharing market in India 
    10. Details on investors

     

    1 Market Segmentation 3
    2 Executive Summary 5-6
    3 Introduction 7
    4 Bike and scooter sharing fleet in India 8
    5 Legislations impacting scooter sharing in India 9-10
    6 Comparison between bike sharing and scooter sharing business model 11-12
    7 Top purposes served by scooter sharing in India 13
    8 About scooter sharing users in India 14-15
    9 Scooter sharing growth in number of cities 2018-H1 2019 16-17
    10 Cash flow and burn rate of scooter sharing start-ups 19
    11 Opportunities and risks with the sharing business model 20
    12 Market Size, Dynamics and Forecast, by Sharing type 21-30
    13 Market split by major Indian cities 31-32
    14 Market Size, Dynamics and Forecast, by Scooter type 33-45
    15 Competitive Landscape 46-48
    16 Funding raised by scooter sharing operators 49
    17 Company Profiles 53-70
    18 Unmet needs and Market Opportunity for suppliers 71-72
    19 Conclusion 73-75
    20 Appendix 76-80
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