The American e-bike market: between challenges and opportunities

The automotive industry is culturally rooted in the United States. In the past few years, however, we have witnessed a paradigm shift marked by the emergence of the bicycle as an alternative and leisure mode of transportation. In this nuanced context, opportunities and challenges exist side by side for the development of a bicycle industry that aims to be sustainable and deep-rooted.

The e-bike market in the United States: green signals for a promising future

A favorable context for the rise of the e-bike…

Built around the car, the American way of life has started to show its limits, in both social and ecological terms. 

Bikes, a solution to road traffic congestion and pollution

With the expansion of urban areas, American cities are facing transportation challenges linked to traffic jams, as well as concerns about air quality and the environment. Cycling therefore appears to be an attractive solution to these problems. According to a survey conducted by the American League of Bicyclists, 65% of respondents who already own an electric bike said they had taken the decision to replace their car.

A public health challenge

The preponderance of cars in the daily lives of Americans is contributing to a sedentary population and rising obesity rates. The electric version of the bicycle offers the possibility of introducing a gentler form of physical activity, accessible to a new audience. A study carried out by the American League of Cyclists also highlighted the fact that 59% of people who found it difficult to exercise on a conventional bike found exercise more enjoyable on an electric bike.

people using bike to avoid traffic problem

…reflected in the performance of the bicycle market 

Thus, this favorable context for the emergence of e-bikes is also reflected in the performance of the overall market. If the bicycle market is gaining ground year on year in the United States, it’s largely thanks to the electric bike segment, which continues to attract new enthusiasts and perform well. Driven by this segment, despite a 10% drop in volume by 2022, the market has nevertheless recorded a 30% increase in value since 2019, reaching $7.4 billion.

For the first time, the milestone of one million electric bikes sold has been passed (1.1 million by 2022, an increase of 25%). The electric bike has become the number-one electric vehicle purchased by Americans, who are increasingly inclined to adopt sustainable and economical modes of transport.

Synergy between local players under construction

The dynamism of the American e-bike market is prompting the players involved to structure themselves and contribute, each in their own way, to the development of this industry.

US electric bike industry attracts new investment

new investment in bike industry

The growing demand has sparked massive interest from local and foreign players to invest in the U.S. bicycle sector. For example, the Franco-American investment group Cardinal Cycling Group (CCG) has injected $6.5 million into the construction of the largest carbon fiber bicycle factory in the USA. The aim of these investments is to meet growing demand and reduce dependence on imports.

The U.S. government: significant efforts to establish a bicycle plan

Joe Biden’s legislation provides a $4.1 billion investment in the development of e-bikes, offering a reimbursement of 30% of the price, up to a maximum of $900. In addition, local initiatives such as New York’s low-cost E-bike Loan NYC initiative are encouraging the use of bicycles. These financial incentives aim to make cycling more accessible and affordable for more Americans.

The various players are organized into associations

The favorable market context is encouraging both professionals and individuals to form associations to increase their impact. There are many such associations, but the most important are as listed below:

  • Association of Bicycle Product Suppliers: is a coalition of professionals working in the legal field to promote regulations more favorable to the bicycle industry. The association is very active, producing annual studies on the place and use of bicycles in the United States.
  • PeopleForBike: Founded in 1999, PeopleForBike is an association of individuals working to give bicycles a more prominent place on the country’s political agenda, focusing on the economic, industrial, health and social aspects of cycling.
  • American League of Cyclists: This association has a societal mission and promotes the adoption of cycling and its many benefits through a number of campaigns.

What are the challenges for the US electric bike market?  

The American bicycle industry, excessively dependent on imports: what perspective for internal consumption?

In the USA, domestic demand is too important for local players, who are too dependent on imports. The country’s main trading partner is China, which alone accounts for 76.6% of imports, while the share of local production is very low, at just 2.2%.

However, by 2022, in a difficult economic climate, export volumes will have fallen by 33%. As mentioned above, despite this phenomenon, the overall value of the market has increased. As a result, the market is moving upmarket, with consumers buying less, but at higher prices. In this context, brands are seeking to make themselves more visible to cyclists through innovative and differentiating products such as connected services.

Component crisis has persistent repercussions for the US ebike industry

Overproduction of bicycles, stimulated by high demand during the pandemic, led to large inventories. This glut of unsold bikes triggered a crisis in the industry, putting companies in difficulty and leading to layoffs and financing problems. American giant Specialized paid the price earlier this year, laying off 8% of its workforce as part of a strategic transformation.

It is estimated that the American bicycle industry is 14 months ahead in terms of inventory. In view of this, it is expected that over the next few months, American players will try to sell off stock on European markets by slashing prices even further.

Lithium batteries, a growing concern in the U.S. 

The safety of lithium-ion batteries in e-bikes is a major concern in the USA. In 2022, there were 220 battery-related fires in New York. Pending nationwide regulations, some cities have taken steps to require specific certifications. However, these measures do not apply to online purchases, which account for a sizeable share of the US market compared with other consumer channels. This exemption creates a significant disadvantage for consumers.

In conclusion, the U.S. bicycle market is undergoing a major transformation, offering both opportunities and challenges. Despite obstacles related to battery safety, import dependency and excess inventory, increasing investment in local production, government incentives and changing consumer habits are paving the way for significant growth. The U.S. bicycle market is turning a significant corner, and there appears to be considerable potential for further evolution, paving the way for more sustainable and active mobility for Americans.