e-Motorcycles Struggle to Ride e-2WV Wave but Opportunities Remain

e-Motorcycles have struggled to gain as much traction as other electric two-wheel vehicles (e-2WVs) such as e-bikes and seated e-scooters. This is largely due to the unique and extensive range requirements of typical motorcycle consumers. In North America and Europe for example, consumers generally demand high powered motorcycles with long ranges (250 miles or more). Also, use cases are often associated with leisure and long-distance travel, as opposed to urban commuting, where other e-2WVs have found increasing success. Manufacturers have equipped e-motorcycles with larger batteries to address the range issue, but this greatly increases purchase prices. As a result, sales volumes of e-motorcycles are significantly trailing other e-2WVs, as shown in the chart below.

Unit Sales of e-2WVs by Technology, World Markets: 2020-2030

(Source: Guidehouse Insights)

Long-Term Potential Remains Strong

Despite many challenges around battery technology and consumer acceptance, the long-term outlook for e-motorcycles remains promising. This is largely due to the enormous total addressable market of over 38 million annual gas-powered motorcycle sales. The long-term outlook is also bright because of increasingly stringent emissions standards making gas-powered motorcycles more expensive, the increasing number of city and national governments offering e-motorcycle purchase incentives while mandating low and zero emission zones. Cost decreases and improvements in lithium ion (Li-ion) battery technology will also likely result in lower cost and higher performing products, while major manufacturers are poised to assume larger roles in e-motorcycle technology development over the coming decade. Guidehouse Insights anticipates that global e-motorcycle sales will grow from roughly 1.1 million units in 2020 to 3.6 million by 2030, at a compound annual growth rate of 14.4%.

Growth Opportunities for Vendors

Guidehouse Insights outlined the following key opportunities in the global e-motorcycle market for vehicle and component suppliers and manufacturers:

• $5,000-$10,000 e-Motorcycles in North America and Europe: While these regions have considerable e-motorcycle offerings in a high end segment, most of these products are priced out of reach for typical motorcycle consumers. All e-motorcycles from Harley-Davidson, Energica, and Lightning Motorcycles have a manufacturer suggested retail price of over $20,000. Several of Zero Motorcycles’ products (SR/S and SR/F) also sell above this price point. There is a gap in the market for decent quality, lower priced e-motorcycles. SONDORS Electric Bikes is an example of a company moving to fill this gap with its recently unveiled $5,000 commuter Metacycle. The bike has 80 mph top speed and 14.5 kW of peak motor power.

• Li-ion, High Speed e-Motorcycles in India: The country moved into phase 2 of its Faster Adoption and Manufacturing of EVs in India (FAME-II) program in April 2019. Low speed and low range models, as well as e-motorcycles powered by sealed lead-acid batteries, no longer qualify for FAME subsidies (unlike in FAME-I). There is an opportunity for manufacturers to capitalize on the change in incentives by offering e-motorcycle products with a minimum top speed of 45 km/h, a minimum range of 80 km, and powered by Li-ion batteries.

• Battery Swapping in East Asia and Africa: In countries where large portions of the population commute by motorcycle (e.g., India, Indonesia, and so on), suppliers could offer consumers significant discounts on the purchase price of their e-motorcycles and recover the investment through monthly subscriptions to battery swapping programs. This model has been proven to be highly successful with the Gogoro Network for seated e-scooters in Taiwan. e-motorcycles also offer a compelling business case to replace gas-powered motorbike taxis in many regions of the world, which carry high fuel and maintenance costs due to the heavy mileage associated with these vehicles. Companies such as Ampersand in Rwanda and FIKA Mobility and Ecobodaa in Kenya are developing battery swap capable e-motorbikes and swap stations. These products are designed to capitalize on the market potential—there are over 5 million motorcycle taxi drivers in East Africa alone.