Electric Scooter and Motorcycles Market

Market Overview

The global electric scooter and motorcycles market size was valued at USD 10,324.10 million in 2022. It is projected to reach USD 78,035.31 million by 2031, growing at a CAGR of 25.20% during the forecast period (2023-2031)

High pollution levels are caused by increased vehicle noise and gas emissions in major cities worldwide. The steady growth rate in demand for renewable energy and powerful vehicles drives the global market for electric scooters and motorcycles. Electric scooters are becoming more prevalent in urban areas because of the growth of shared micro-mobility services, particularly in emerging nations like China and India. In addition, the availability of low-pricing and app-based services is increasing the daily demand for electric scooters. The development of electric scooters and motorbikes is fueled by advances and breakthroughs in battery technology, particularly in Asia-Pacific.

Market Dynamics

Global Electric Scooter and Motorcycles Market Drivers:

Rising Demand for Energy-Efficient, Lightweight, and Technologically Suite Vehicles

Governments all around the world have enacted strict laws and restrictions as a result of the increase in vehicle emissions. Manufacturers of automobiles and automotive parts are more concerned with lightening the load on the vehicle to increase fuel efficiency. Another significant step toward reducing emissions in many developing economies is using electric vehicles. Governments are encouraging the adoption of more electric vehicles by offering incentives like subsidies and tax exemptions. The Faster Adoptions and Manufacturing of (Hybrid and) Electric Vehicles (FAME) initiative provides tax breaks and incentives in India.

Additionally, customers who purchase electric 2-wheelers under the FAME initiative are eligible for a subsidy of INR 10,000 per kWh of battery capacity, and INR 2000 crores have been set aside to support the sale of approximately 1 million electric 2-wheelers by March 2022.In the United States, a federal tax credit went into effect in December 2019 and applied to new electric bikes bought between 2018 and 2020. The development in battery technology, including the advent of lightweight cells, improved safety features, such as traction and throttle control, and a noticeably better method of power distribution, are to blame for the rise in demand for electric bikes and scooters.

Global Electric Scooter and Motorcycles Market Restraint:

Lack of Infrastructure

Even though electric scooters and motorcycles are essential for reducing global transportation emissions, the lack of crucial infrastructures, such as charging stations, has restricted the worldwide market to a few nations. In most developing countries, electric two-wheelers are restricted to driving within the city limits since they lack charging stations outside the city because the battery packs that power them provide a set amount of range before recharging.Typically, the OEM will install a home charging station at the appropriate place after you purchase an electric two-wheeler. However, there is a danger that drivers would become stranded in regions without the necessary charging infrastructure because the power delivery of e-scooters depends on usage patterns.

Global Electric Scooter and Motorcycles Market Opportunities:

Evolving Emission Regulations

The role of electric cars (EVs) has increased due to the gradually stricter fuel economy and tailpipe CO2 limits. Governments and towns have implemented incentives and rules to hasten the transition to sustainable mobility. As a result, regulators are setting stricter emissions objectives at the national and international levels. In light of this, the European Union (EU) has unveiled its "Fit for 55" program, which aims to coordinate policies related to the environment, energy, transportation, and land use to cut net greenhouse gas emissions by at least 55% by 2030. The US Department of Transportation has set a 50% electric vehicle target for 2030.The switch from fossil fuels to electric vehicles in developing and post-industrial nations are supported by the UN Environment's Electric Mobility Program. This includes formulating roadmaps for electric mobility at the national and regional levels, developing legislation, sharing best practices, piloting technological choices, monitoring EV uptake, estimating emissions and economic benefits, and more.

Regional Analysis

Asia-Pacific Dominates the Global Market

The global electric scooter and motorcycles market is bifurcated into four regions: North America, Europe, Asia-Pacific, and LAMEA. 

Asia-Pacific is the most significant revenue contributor and is expected to grow at a CAGR of 23.65% during the forecast period. OLA announced in December 2020 that it would invest INR 2,400 crore (about USD 327 million) to build the world's most prominent electric scooter factory in Tamil Nadu. The plant will manufacture Ola's planned line of two-wheeler goods, beginning with its electric scooter, and will initially have a production capacity of 2 million electric vehicles annually. In addition, Okinawa Autotech declared its intention to spend INR 150 crore in the nation in July 2020. This additional investment will build the company's new production facility in Rajasthan. According to the firm management, the new facility's initial annual capacity will be 5–6 lakh units, potentially increasing to 10 lakh units in the future.

Europe is expected to grow at a CAGR of 21.60% during the forecast period. The demand for electric vehicles is developing rapidly throughout the nation due to growing environmental concerns and rising gasoline prices. However, e-bikes are the most popular option for people in the country regarding daily commuting. Several motorcycle and scooter manufacturers in the nation are introducing the newest models in the electric two-wheeler segment to take advantage of the expanding industry and increase their market share. For instance, Black Tea Motorbikes introduced the Bonfire, the company's first electric motorbike model, in July 2021. The Bonfire has a top speed of 75 kmph, a maximum stated range of 75 km in Eco mode and dual detachable battery architecture. The bike features three riding modes, each with a distinct range.

North America is expected to grow steadily over the forecast period. To increase demand, the country's federal government offers tax breaks and other incentives to consumers of electric motorcycles. For example, the federal tax credit is offered in 50 US states and validates all new e-motorcycles purchased in 2018, 2019, 2020, and 2021. The nation's top luxury motorcycle manufacturers are investing significantly in creating the latest electric vehicle goods to preserve their place in the market. For instance, Harley Davidson Inc. announced in May 2021 that it would introduce the LiveWire brand of all-electric motorcycles. The goal of the relocation is to keep up with worldwide advances in the electric motorcycle business. Zero Motorcycles introduced its new model lineup for 2022 in the nation in July 2021.

Segmental Analysis

The global electric scooter and motorcycle market is segmented by vehicle and battery types.

Based on vehicle type, the global electric scooter and motorcycles market is bifurcated into E- Scooters and E- Motorcycles.

The E- Scooters segment is the highest contributor to the market and is estimated to grow at a CAGR of 25.60% during the forecast period. E-scooters sell more than e-motorcycles because they are less expensive upfront, and more types are available, giving consumers more choices. The popularity of the e-scooter is fueled by its attraction as a toy and a potential mode of transportation for commuting. As a result, numerous firms are starting to inundate large cities with thousands of scooters that can be rented by the minute. Several pilot initiatives have been started to introduce e-scooters gradually to minimize car emissions in urban areas. Additionally, motivating traditional two-wheeler manufacturers to enter the market is the popularity of e-scooters. India, for example, is quickly becoming a lucrative market for e-scooters. As a result, several Indian two-wheeler producers are getting ready to introduce their models on the market.

Most electric motorcycles have smaller engines powered by batteries and have the same appearance as conventional motorcycles. The range of these electric motorcycles is expanding as EV battery technology advances. An electric motorcycle can operate on average for 64 to 161 kilometers on a single charge, while some models can go up to 354 kilometers. Electric motorbikes are considered conventional vehicles and are therefore not allowed on sidewalks and other locations where electric scooters are permitted; hence the market is still in its infancy. However, this segment’s growth is anticipated to outpace e-scooters as more people are interested in purchasing an EV for long commutes. 

Based on battery type, the global electric scooter and motorcycle market is bifurcated into lithium-ion, sealed lead acid.

The lithium-ion segment owns the highest market and is estimated to grow at a CAGR of 25.70% during the forecast period. Lithium-Ion batteries have proven to be a critical development in the creation of cellphones, portable electronics, and even electric cars since their introduction by Sony Corporation in 1992. Due to their improved performance over nickel metal hydride and lead acid batteries, lithium-ion batteries dominate the market for electric 2-wheelers. Lithium-ion batteries come with various possibilities for the negative and positive electrodes, giving automobile manufacturers more options for cost-cutting measures. Lithium-ion batteries have a higher recycling rate than lead-acid and nickel-metal hydride batteries. 

The range (distance driven) of vehicles powered by lead-acid batteries is less than that of vehicles powered by lithium-ion batteries. Lead is a well-known industrial contaminant and a threat to the environment. Recycling is an option, but it must be done carefully. While lead exposure occurs from the beginning of the mining process until each battery has been properly recycled, lead-acid batteries are 99% recyclable. However, lead-acid batteries are used far more frequently in developing countries like India due to the lower cost of lead-acid batteries compared to lithium-ion batteries. 90% of the electric two-wheelers sold in India in 2018 had lead acid battery options, according to SMEV.

Recent Developments

• February 2023- River Indie e-scooter launched at Rs 1.25 lakh and hasa 200kg load capacity.
• January 2023- Hero MotoCorp launched a new Xoom, eyes a higher market share in the entry-level scooter market.