Market Trends of Asia-Pacific Electric Scooters And Motorcycles Industry
E-Scooter to Witness Highest Demand
- The electric vehicles industry is slowly revolutionizing the automobile sector, with more efficient and powerful electric vehicles being released yearly. Apart from being viewed as a cleaner and greener mode of transport for a short distance, e-bikes, e-scooters, and e-motorcycles are finding varied uses across the world in different sectors and applications.
- While electric bikes and scooters are said to be more expensive to purchase than regular two-wheelers, the amount of money saved with respect to rising fuel costs is encouraging several players across logistics, food, delivery, tourism, etc. Accordingly, the companies are investing in procuring these electric two-wheelers and are entering strategic agreements with these vehicle manufacturing companies to gain a notable edge over other competitors in the market.
- E-scooters witness higher sales than e-motorcycles due to lower upfront costs and the availability of more models in the market, which provide ample options for buyers. The allure of the e-scooter, both as a toy and as a potential vehicle for commuting, is driving its adoption. Thus, several startups are beginning to flood major metropolitan areas with hundreds of 'rent by minute' scooters.
- Several pilot programs have been initiated to introduce e-scooters in a phased manner to reduce vehicle emissions in cities. The popularity of e-scooters is also encouraging conventional two-wheeler manufacturers to enter the market. India is emerging as a lucrative market for e-scooters. Hence, several two-wheeler manufacturers are gearing up to launch their models in the segment. For instance,
- In March 2022, Hero MotoCorp, the largest two-wheeler manufacturer in India, revealed its future electric car brand, VIDA. The first image of the logo, which demonstrates how the new branding would appear, was also made public by the corporation.
- Several manufacturers are expanding facilities in the region to improve battery technology in the region. For instance,
- In November 2022, JIOS Aerogel announced plans to build a cutting-edge factory in Singapore to develop cutting-edge technology for battery makers. The factory will employ a ground-breaking, automated production technique designed with the assistance of the Singapore Economic Development Board (EDB).
- With the above-mentioned development across the region, the market is witnessing major growth during the forecast period.
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China is Expected to Dominate the Asia-Pacific Market
- China, India, and Japan are the major economies in the regional market, which are expected to influence the overall market. These countries are witnessing the entry of an increasing number of startups and well-established and conventional manufacturers in the market.
- China's electric two-wheeler market is well-developed, with local manufacturing, sales, and import and export operations. In October 2023, QJ Motor which is one of the leading electric scooter manufacturer in China announced its expansion in other provinces in China. Company offered new models that offers 800-watts (1.1 bhp) scooter. Further, China is taking up subsequent efforts for taking ahead the electric mission and revamp thei country's convestional vehicle fleet and electric scooter has been country's upfront priority.
- As China continues to increase production of electric two-wheelers, the market is aided by increased demand and new product launches to complement it.
- Government initiatives and incentives play a major role in the adoption of electric bikes in India. Delhi government is now planning to promote electric bikes by offering financial incentives under the Delhi EV policy. The state government's transport department has released a draft proposal for considering electric bikes as a new segment under the Delhi Electric Vehicle Policy 2020. For electric cycles, it plans to subsidize 25% of the cycle's cost (up to Rs 5,500) and give a fixed additional incentive of Rs 2,000 on the first 10,000 electric cycles. A purchase incentive of 33% of the price, up to Rs 15,000 per cargo e-bike, will be given to buyers of the first 10,000 cargo e-bikes.
- The central and state governments have been encouraging EV adoption, and the finance minister even stated plans to develop a strategy for battery swapping in the FY22 budget. It's just a matter of time until battery-switching facilities become commonplace, thanks to the market and government's backing for electric vehicles. To decrease the price of electric bikes in India, major players have invested heavily in research and development and localization of the critical components. The plan is to localize the entire production, including controllers and the battery. This will help cut down the electric bicycles' cost and make them much more affordable to the masses. This aspect is crucial as 65% of the demand for electric bicycles is from tier 2 and tier 3 cities.
- According to a new study from the Society of Manufacturers of Electric Vehicles (SMEV), sales of electric two-wheelers in India climbed by 132 percent in 2021. During the year, 233,971 electric two-wheelers were sold, up from 100,736 the previous year. SMEV has attributed this to the subsidies given to high-speed electric two-wheelers under the FAME 2 policy that have made them more affordable than low-speed two-wheels. FAME 2, or Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India, is an incentive-based scheme by the government to subsidies the making and buying of electric vehicles, including two-wheelers.
- With the ongoing demand for low-cost electric 2-wheelers, major players are rolling out plans to launch electric versions of their top-selling models. For instance,
- In February 2022, Honda Motorcycle and Scooter India confirmed that it is planning to launch an electric version of its best-selling scooter Activa. The new EV could be called the Activa E.
- Hero announced an upcoming electric scooter in August 2021, and the brand later confirmed in November that the scooter would debut in March 2022. The company has officially launched its new Vida brand, under which electric vehicles will be sold, with the first model set to debut on July 1, 2022.
- With the rapid increase in electric bike manufacturing companies, changing customer preferences, and government incentives are poised to witness a growth rate during the forecasted period.
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