The India E-Bike market was valued at USD 1. 02 million in 2020, and it is expected to reach USD 2. 08 million by 2026, projecting CAGR of 12. 69 % during the forecast period. (2021-2026). Recent COVID-19 has resulted in reduced sales of e-bikes in India.
New York, March 22, 2021 (GLOBE NEWSWIRE) -- Reportlinker.com announces the release of the report "India E-Bike Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)" - https://www.reportlinker.com/p06036770/?utm_source=GNW
In 2020, the market generated a revenue of USD 1.02 million, as compared to USD 1.70 million in 2019. These reduced sales were the result of lockdowns and economic slowdown in India.
According to 2018 report of The Energy and Resources Institute (TERI), which is supported by All India Cycle Manufacturers’ Association (AICMA), If two-wheelers and four-wheelers were substituted by bicycles for short-distance trips, then it can provide an annual benefit of around INR 1.8 trillion, and if 50% of all trips under 8 km were done through cycling, it will result into energy savings of up to 0.35 million tonnes.
Apart from increasing customer preference towards electric bikes for recreational and adventure activities, the adoption of e-bikes in several other sectors such as logistics, and rentals is driving the market growth of electric bikes in India. Large population of the country, along with raising last mile logistics is expected to provide e-bike market an opportunity to grow during the forecasted period.
The e-bike market in India is still in nascent and growing stage with many local players offering wide range of products. However, the high price of e-bikes in the market might hinder the growth. As the average price of e-bike is same of basic scooter in India, the customers are preferring scooters over e-bikes.
Customers preference towards other modes of transportation, lack of cycling lanes and infrastructure in the country might hinder the market growth in India during the forecasted period.
Key Market Trends
Growing Demand For Eco-Friendly Transportation
E-bikes, especially pedelecs, are proving to be the ideal mode of transportation in the future. Moreover, they are also a great mode of transportation, especially for recreational activities, as they offer the fun of cycling, combined with the suitability of an automobile. Furthermore, these bikes allow consumers to navigate through rough terrains, which are otherwise difficult to navigate without an electric motor. These factors are making e-bikes popular in India.
Given the fact that two-wheelers account for as much as 75% of the vehicular pollution in India, e-bikes can become a very eco-friendly alternative to the large two-wheeler using population.
The demand for e-bikes in India has increased over the last few years. However, during and post COVID-19 pandemic, along with most of the industries, the e-bike has also witnessed a decline due to complete shutdown of manufacturing sites, strict COVID guidelines to be followed while manufacturing, disruption of supply chain among others.
Many start ups have started selling electric bikes in India. Since the demand for e-bikes has increased across the nation over the last few years, manufacturers are planning to expand their facilities to target markets. Leading world manufacturers have also entered the Indian market to capture the growing market demand.
For instance, AlphaVector registered a massive 300% increase in revenue, growing from INR 50 crore to INR 200 crore in ten months (Apr-Jan 2020). The company has announced it is working towards INR 300 crore revenue. As a part of this strategy, the company has started their sales online and is expecting to see an increase of online customers by 25-30% by end of March 2021.
Growing demand for eco-friendly transportation, increase in electric bike sales and support by government initiatives, is expected to drive the Indian electric bike market growth during the forecasted period.
High Initial Cost Might Hinder The Market Growth
E-bikes are becoming more expensive than the normal motorbikes, due to expenses related to design, wiring, motor or mini engine, and battery power. The cost of an e-bike is majorly dependent on its grade and quality. For instance, the Hero Cycles electric bike average cost is about INR 26,000. The price can range from about INR 20,000 to USD 1,50,000 and above.
The high costs of new e-bike batteries and replacement of the same are also hindering the growth of the market studied, as people prefer spending less money on buying new batteries for e-bikes. For instance:
The average maintenance cost per annum of an e-bike is around INR 1,500 to INR 2,000. Additionally, the major states, like Telangana, Tamil Nadu, Rajasthan, Karnataka, and others do not provide any incentive.
To decrease the price of electric bikes in India, Hero Cycles has invested heavily in research and development as well as localization of the critical components. The plan is to localize the entire production including controllers and the battery. This will help cut down the cost of the electric bicycles 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.
As the market is still in development stage, and still the technology is evolving, high initial investment has is required for purchasing electric bikes, which might hinder the market growth in India during the forecasted period.
The India E-Bike market is moderately fragmented with the presence of a number of startups and companies, such as Hero Cycles, GoZero, Being Human, Giant Bicycles Co. Ltd, and others. The market is highly driven by factors like advanced battery technology, lightweight materials, growing investment in R&D projects, etc. To provide more convenient experience to the customer, major global e-bike manufacturers are expanding their market reach in India and local startups are introducing new models in the market. For instance,
- In 2019, Zadd Automotive introduced two electric bikes Utility Mini, and Zadd X1, with the option of converting them into smart bikes.
- In February 2020, Nexzu Mobility has launched three e-cycles, Roadlark, Aello, and Rompus. All the e-cycles are equipped with lithium-ion batteries and BLDC 250W 36V motors.
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