Published Date : 22, 2022
The global e-bike market is expected to drive growth at a CAGR of 9.6% during the forecast period and to reach valuation USD 40.98 billion by 2030 from at USD 16.42 billion in 2020.
Electric bikes are being used to accommodate the requirements of comfortable and safe and transportation. Use e-bikes in densely populated areas helps in reducing air pollution which is one of the largest environmental issue mainly caused by vehicle fume. E-bikes which were in its initial stages used as sporting tool only are been used as a major means of transportation over the past few years. Benefits offered by e-bikes such as distance covered in minimum charging, easy passing through hilly areasmakes them a popular option in new era of bicycles.
E-bike Market Share, By Motor Type, 2020 (%)
|Motor Type||2020 (%)|
Europe and North America are developed regions and hence customers are well aware of the healthy lifestyle. Owing to the health benefit offered by pedaling, e-bikes are gaining popularity in Europe, U.S., and Canada. In addition, with growing environmental concerns, the European Government and environmental agencies are enacting stringent emission norms & laws that increases demand for the electric bike in Europe. For instance, in Europe, the European Union (EU) is committed to achieve its 20% greenhouse gas reduction target in 2020 for the second phase of the Kyoto Protocol. In North America government initiative and the support offered by the government in the form of subsidies and tax benefits such as tax rebates are the market drivers. With such initiatives from government bodies, the e-bikes market will grow rapidly in Europe as well as in North America in coming years.
In Asia Pacific countries such as China and Japan are largest manufacturers and exporters of electric bikes. Increase in initiatives for environmentally friendly vehicles & bikes and development of related infrastructure from the several government bodies such as India are anticipated to boost the growth of electric bike market in Asia-Pacific.
Increasing fuel costs to boost the market growth of e-bikes
Fuel prices all around the world are increasing continuously over the past few years as the demand for fuel is raised. Considering long term investment in bikes, customers are shifting their focus from fuel based cars to electric cars keeping in mind cost saving benefits of e-bikes. An e-bike offers huge savings in its daily operations. It minimizes the fuel cost, lowersservice and maintenance and hence it is as much as thrice cheaper than the petrol/diesel vehicles. As prices of crude oil and fuels such as petrol and diesel soaring rapidly this factor will boost the growth of e-bikes in coming years.
High cost of e-bikes to restrict market growth in coming years
E-bikes are beneficial when it comes to sustainable alterative for fuel based bikes, but at the same time its cost is much higher than the regular bikes. The extra cost of electric bike is mainly attributed to the cost of battery. The raw materials used in the batteries of e-bikes are costlier, also processes involved in production of these batteries is very expensive. With such costs making the e-bikes costlier, customers of lower income group cannot afford these bikes and hence these bikes are only seen in urban areas mainly. This factor may act as an prime restraint for the growth of e-bikes market in coming years.
As the e-bikes industry and its revenue is mainly generated by urban cities, there lies an opportunity for the manufacturers to decreasing the price of e-bike and make it available in the price range that is affordable by middle and lower income group families. Innovative battery raw materials for batteries which will also offerhigh energy density could reduce the cost greatly and this can be a promising opportunities for established as well as new market players to strengthen their presence and expand in new markets.
Banned use of e-bikes in major cities of China
China is one of the major countries in global economy. But in 2016 with a legislation Beijing, Guangzhou, Shanghai, and Shenzhen banned the use of e-bikes. Since 2013, China implemented regulations for the specifications and size dimensions of e-bike lithium battery. During the first six months of 2014, the lithium battery equipped e-bikes’ production reached 1.7 million units. But with the ban on e-bikes the e-bike manufacturers are facing challenges for their businesses in these regions.