Electric Scooter and Bike Market Growth: An Innovative Business Growth Vision Analysis

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E-commerce is influencing electric scooter and motorcycle sales in another way, by acting as the very distribution channel for them.

Recently, petrol (gasoline) price touched INR 100 per liter in Delhi, while diesel is going at more than INR 85 a liter. This is giving vehicle owners nightmares, but this might also give a push to India’s electric vehicle (EV) industry. With EVs already being pitched as the best alternative to gasoline and diesel vehicles, the fuel price hike might hasten the shift. This is because procuring electricity from the charging station costs a lot less than a putting liter of these fossil fuels in the tank.

Moreover, the Indian government is already offering substantial subsidies and other benefits on the purchase of EVs. With similar efforts being taken by governments around the world, the electric scooter and motorcycle market revenue, as claimed by PS Intelligence, is set to rise from $5,913.9 million in 2019 to $10,529.7 million by 2025, at a healthy 14.4% CAGR between 2020 and 2030. Due to such initiatives, already in 2020, more than 350 million electric two- and three-wheelers were on the world’s roads, according to the International Energy Agency (IEA).

Electric scooters and motorcycles are being used for personal transportation, shared mobility, and last-mile delivery services. As urban traffic congestion is a worsening problem in both developed and developing countries, governments are trying to take as many three- and four-wheelers as possible off the road and replace them with two-wheelers, which take a lot less space. Electric two-wheelers not only help tackle the traffic problem but also that of the burgeoning greenhouse gas (GHG) concentration in the atmosphere, which is leading to increasing weather variance.

Similarly, the rise in the internet penetration, which, as per the World Bank, was already 48.997% of the global population in 2017, has driven the expansion of the e-commerce sector. Moreover, people are shifting to shopping from home, since they can compare products, avail of discounts, pay electronically, and get the stuff delivered at their doorstep. The online order boom has led e-commerce and logistics companies to widen their delivery fleet with electric two-wheelers, so they can fulfill the orders and save on vehicle operations and maintenance expenses.

E-commerce is influencing electric scooter and motorcycle sales in another way, by acting as the very distribution channel for them. With the widening reach of online shopping portals, many automakers have begun selling their electric two-wheeler models over the internet! Moreover, such vehicles are majorly manufactured by regional and start-up companies, which find it difficult to establish direct sales channels. In this regard, the well-known e-commerce platforms allow them to reach customers almost instantly.

On the personal level, electric scooters have found a wider usage than electric motorcycles, as the former are cheaper and available in more models. However, scooters have speed and driving range limitations, which is one of the key restraints for the growth of the worldwide EV sector. Thus, with automakers launching motorcycles that can go faster and further on a single charge, their sales are expected to pick up sharply in the years to come. Moreover, with the declining prices of lithium-ion batteries, motorcycles are becoming cheaper too.

Of the more than 350 million electric two- and three-wheelers in operation in 2020, as mentioned above, over 25% were in China alone. Due to this factor, the electric scooter and motorcycle market has been dominated by Asia-Pacific (APAC) almost since the introduction of these automobiles. The need of China and India to transition to electric mobility is perhaps greater than of others since they are the most-polluted nations on earth. As per many news agencies, 22 of the world’s 30 most-polluted cities in 2020 were in India, while Delhi ranked as the most-polluted national capital third time in a row.

Therefore, with the entire world battling air pollution and urban traffic congestion, prospects for electric two-wheelers seem bright.

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