The dynamics of the electric bicycle are no longer a secret. The market has increased in value by 40% in 2020 compared to the previous year, reaching 22 million EABs sold in Europe and the UK. Within the market, several categories stand out, notably that of electric cargo bikes, which show very strong potential.
While Germany is already well ahead in e-cargo sales, there is a strong development in the UK (+60%) and France (+350%), where sales could even reach 50,000 units in a few years according to Union Sport & Cycle. At European level, the growth of this segment is estimated at 66% over 2021 (European Cargo Bike Industry Survey by City Changer Cargo Bike).
The conquest potential of electric cargo
According to City Changer Cargo bike (CCCB), the potential for replacing polluting vehicles on urban journeys by electric cargo bikes is 50%.
Electric cargo: use by private individuals…
One of the strengths of the e-cargo is its number of applications and targets. Indeed, the two-wheeler or three-wheeler can suit families who, instead of financing a second car, choose a practical and sustainable mode of transport, to carry children, luggage, food… As far as the geographical area of use is concerned, the city is the main playground, especially the big cities which are very congested with traffic jams, for the time saving during the home-school-work trips. However, the area is expanding more and more, reaching rural areas where the environmental and well-being response is very important.
And by professionals
In the professional sphere, the cargo bike also has resources for the whole of the delivery sector, but also for services, with the possibility of being used for municipal services. The last mile issue is obviously crucial in explaining the potential of the cargo bike to meet the growing need for delivery and transport of goods due to the expansion of e-commerce. The number of deliveries linked to e-commerce will continue to grow, which should ensure an exponential evolution of cargo bike fleets over the coming years. For companies, the deployment of a fleet of cargo bikes allows them to cover long distances easily and quickly, with little maintenance and cost constraints, all with a high load capacity. Delivery could represent up to 45% of the e-cargo market.
Between the private and professional segments, the shares are still roughly the same.
Opportunities in the cargo bike market include European and government subsidies for companies that will implement a policy to reduce CO2 emissions, including the purchase of electric cargo bikes for delivery. Local policies to significantly reduce the use of combustion engine vehicles should also boost the growth of e-cargo in Europe. In some countries, the current price of fuel is already a barrier, forcing many individuals to turn to greener and cheaper alternatives in the long term.
According to the General Inspectorate of Finance analysis, the market will grow at a compound annual growth rate of 11.4% between 2021 and 2031.
Which players will dominate the e-cargo market?
The potential and dynamics of the market are attracting many new entrants to the market. According to a study by Future Market Insights, 66% of the current market is accounted for by the 9 largest players. Among the well-established brands are Yuba, Rad Power Bikes, Tern, Bakfiets, Babboe, Urban arrow, Christiana Bikes, Douze Cycles, Nihola, Butchers & Bicycles, Carqon, Riese & Müller, Pedego electric Bikes, Worksman Cycles, XYZ Cargo, Cero Electric Cargo Bikes, XCYC, Xtracycle, Amsterdam Bicycle Company, Triobike… Not to mention the interest of certain electric bicycle brands that could launch their cargo segment, the arrival on the market of retail chains (Decathlon for example) and automotive players that have sniffed out the opportunity…
In terms of territory, it is no surprise that Germany is expected to be the leader with an estimated 38% market share by 2031, with a significant subsidy policy (25% or €2500 max discount on the purchase of an e-cargo with a permitted load of more than 150 kg). Europe is estimated to be the fastest growing market in the next decade. In Asia, the market will be dominated by China with an estimated 50% share by 2031 in East Asia, which will capitalise on its strengths in manufacturing and battery technology to meet the growing demand for people’s daily mobility. The market will be dominated by Australia and New Zealand in South Asia and the Pacific region with 67% share by 2031, where governments are implementing initiatives to subsidise the purchase of electric vehicles. In North America, the powerful and government-backed industry will logically lead.
What is the main obstacle for the electric cargo bike?
Strongly supported by local and European policies and fully in line with the needs of delivery and service companies, city dwellers and, more broadly, environmentally aware populations, the potential of the electric cargo bike is quite simply grandiose. The only shadow in the picture, which also hangs over the cycle industry and the industry as a whole, is the problems linked to the supply chain. Indeed, there is a shortage of components and materials as well as an increase in transport costs… A context that will inevitably slow down sales and push up prices.