BikeBiz

“The e-bike craze is unsustainable,” says Marc van Woudenberg, creator of
Amsterdamized.com, a blog aiming to show how normal cycling is in the Netherlands. He’s seen an increasing number of his compatriots buy e-bikes, but he’s not convinced the market can be maintained at that rate.

And the latest sales figures hint at why this may be the case. Whereas the overwhelming number of e-bike sales in the last two years have been via independent bicycle dealers in the Netherlands, mass market retailers are now muscling in. This generally leads to price crashes, and quality can often suffer. There is a similar scenario in the US, where Best Buy and Walmart have started selling e-bikes.

However, the e-bike beacon has long been the Netherlands. The latest sales totals look good, but the shift to mass market is sudden, albeit not terribly surprising given the bumper e-bike sales in the Netherlands for the past three years.

Dutch dealer association BOVAG reports that 41 per cent more e-bikes were sold in the Netherlands during the first half of 2009 compared to the same period in 2008. There were 75,000 sold through IBDs, and 30,000 were sold by big-box retailers, supermarkets and DIY stores.

Dutch IBDs have done well from the e-bike, even putting a percentage point on the overall market share. Independent bicycle dealers make up an impressive 86 per cent of the Dutch bicycle market, by turnover.

By volume, the IBD share is reducing from 77 per cent in 2008 to 70 per cent this year.

German bicycle dealers have also done well out of e-bikes. “The electric bike will be a standard product, not a short-term trend,” believes Mathias Seidler, CEO of Derby Cycle of Germany, owner of the Kalkhoff and Focus bike brands. “In Germany, in 2008, 100,000 e-bikes were sold, but I believe that sales will quadruple within the next three years.”

Specialist bicycle dealers in the US and UK are still wary (especially given the market penetration by Best Buy and Walmart). This could be about to change. Trek, the leading US maker of enthusiast bicycles sold only via bike shops, has introduced Ride+, a line-up of electric city bikes for 2010.

Who’s going to buy them? Trek’s e-evangelist Eric Bjorling said: “We’ve identified the following categories: Assisted Fitness, Increased Mobility/Equalized Speed, Cargo Capacity, and Sweat-free Commute. Buyers are typically a little older, which makes sense given the price tag.

“One of the largest reasons for buying an e-bike has been a husband or wife who wants to ride with a more bike-experienced spouse.”

E-bike consultant Ed Benjamin of the US believes the sales figures from the Netherlands show that American and UK bike shops have been too slow to electrify: “What I’m seeing in transportation-orientated markets – examples being China, Japan and the Netherlands – is that people understand what the electric bike can do. In America and the UK, a very small percentage of the population are into sport bicycles, but a very large percentage of the population need to get from point A to point B every day. Cultural acceptance is happening, pushed hard by fuel price hikes, and in turn by green issues.”

Benjamin, co-author of Electric Bikes Worldwide Reports and co-founder of the Light Electric Vehicle Association (LEVA), predicts the global market for e-bikes will more than double by 2012: “I often wake up at night wondering whether I’m being too aggressive in my forecasting, then I think of the Chinese market where sales doubled every year. Half of the Chinese market for bicycles is now made up of electric bikes. E-bikes will replace most of the world’s bicycles.”

Christopher Cherry, assistant professor of civil engineering at the University of Tennessee Knoxville, agrees. His PhD thesis was on China’s e-bike industry.
He lives part of the year in Kunming, China, and has seen a radical shift away from the battery-free bicycle. “Kunming has an estimated 700,000 e-bikes, up from about 180,000 in 2006. Traditional bicycles are nearly extinct.”

Bike industry stalwarts don’t think e-bikes will swamp sports bicycles in Europe, but are expecting the e-bike sector to blossom, whether the pedal-only purists like it or not.

Shimano is now working on e-bike parts, which is a significant move from the
world’s biggest cycle component maker.

As manufacturers produce lighter and lighter e-bikes – with batteries and motors all but hidden away – it will become harder to tell who is using muscle power alone.

“The electric bicycle is going to evolve and improve in ways we probably don’t appreciate today,” said Benjamin. “I like to think of the e-bike as a human-electric hybrid.”

But if mass market retailers stuff up (and many are poor at safely selling standard MTBs, never mind electronically complex e-bikes), then the market for e-bikes could collapse. On the other hand, there’s money to be made in the e-bike market right now but many IBDs are still playing the long game.

At the recent Interbike trade show in Las Vegas there were a great deal of new e-bike exhibitors and bikes from respected global brands such as Sanyo, but American IBDs aren’t rushing to order in the numbers that many predicted.

Interbike marketing manager Rich Kelly said: “I have to wonder if the specialty bicycle dealer channel will be seen as the place to go for e-bikes in the future or if it will be served by others as well in a significant way? These could be motorcycle dealers or mass merchant electronics dealers like Best Buy.

“I know there has been a debate in the bicycle community about whether e-bikes should be considered bikes or essentially the equivalent of motorcycles that happen to run on batteries. Designed the proper way, I believe that they can fit into the bicycle category.”

US IBDs shun e-bikes
A major US supplier recently held an online poll behind a trade-only firewall. The poll asked IBDs about e-bikes. The majority said they weren’t part of their business model.

Electric Bikes in your shop?
Already a success for my shop  2.6%
Trying a few in my shop now  11.0%
Considering it for the near future  11.0%
Waiting a bit longer before trying  18.5%
Tried once, may bring it back  8.4%
Not interested/not my business model  39.9%
Tried it already, and never again  8.7%
Total votes: 346

A look inside the Light Electric Vehicle Association
The Light Electric Vehicle Association now has over 125 members spanning 22 different countries.

Corporate members such as Trek, SRAM, Dahon, Currie, DK City, EPS/BionX, 3T Cycling, ID Bike, Tokyo R&D, Fallbrook Technologies, Gazelle and Fairly Bike have all chosen to support the growing association, which is less than one year old. 

To date there is a well developed website that is packed full of information LEVA companies and consumers will find of interest (www.levassociation.com). A sign-up form on the website gives access to twice-monthly electronic newsletters highlighting current LEVA events around the world (the past twenty can also be found on the website).

The most popular LEVA activity to date are the Member Networking Dinners held in conjunction with major trade shows. For 2010, the dates have already been set and can be found on the organisation’s website. 

Next year LEVA events will coincide with the Taipei Cycle Show, the China Cycle Show, Eurobike, Intermot, and Interbike. At Intermot, a special LEVA pavilion will be established to help LEVA member exhibitors increase their exposure to potential customers and suppliers.

Sid Kuropchak
Executive Director
Light Electric Vehicle
Association LLC
www.LEVAssociation.com