Electric scooter market revs up

Traffic in IndiaFor several decades now, the two largest markets for two-wheeler motorized vehicles have been India and China. Today, the same holds true for the new generation of electric scooters that can increasingly be seen weaving through the traffic in towns and cities from Mumbai to Beijing. Not to be confused with the semi-human-propelled e-scooter that is also rapidly gaining in popularity around the world, the global market for the automotive electric scooter is, according to a recent report from the  MRSF, set to grow at a CAGR of 13.39% over the next five years.

Thanks in part to the 2018 decision of China’s National Development and Reform Commission  (NRDC) to earmark $47bn for the development of electric vehicles (EV) technologies, China has been leading efforts  to reduce costs and meet both domestic and international demand for electric scooters that is simultaneously being driven by a combination of the immediate pandemic-driven need for  social-distanced transport and longer-term concerns over carbon and greenhouse gas emissions. Much to the delight of companies like the Beijing-based Niu Technologies, which has seen its shares quadruple and sales soar by 68% since the arrival of Covid-19, but which also believes it is riding the wave of a much more sustainable  consumer trend – in more ways than one.

Niu Technologies Chief Executive Li YanThe MRSF report calculated that the Asia Pacific region accounted for almost 79% of electric scooter sales in 2018, and only about 2% of Niu’s unit sales are, accordingly, outside China. That is about to change, predicts Niu chief executive Li Yan, who says that the company is about to accelerate its international expansion plans. “We have global ambitions,” Mr Li told the FT. “We are cautiously optimistic that a third of Niu’s sales can be in Europe and the US by 2025.”

It looks set to face some tough competition, because this week Ola (India’s answer to Uber) let it be known that it was looking for a 100-acre site on which to build the world’s largest electric scooter facility,. The news comes just months after it entered into a $300m strategic partnership with Hyundai and Kia with the express purpose of EV development. Last May, it also acquired Etergo, the Dutch developers of an all-electric ‘AppScooter’ that uses swappable high energy density batteries to deliver a range of up to 240 km.

MaharashtraThe acquisition has succeeded in strengthening Ola’s design and engineering capability and its choice of location could have a long-term effect on its export potential. Right now, the choice appears to be between the states of Maharashtra (right) whose capital is Mumbai with all its Western-facing transport infrastructure; and Karnataka to the south that has been winning plaudits for its proactive support for EV development.

Either way, it is ‘game on’ for the global electric scooter market.