One of the major drivers for the e-bike market is the increase in concerns regarding the emission of greenhouse gases (GHG) from conventional vehicles. As such automobiles run on fossil fuels, they lead to high levels of air pollution, which is responsible for climate change, global warming, as well as several respiratory diseases, including lung cancer, chronic obstructive pulmonary disease (COPD), and asthma. This is why governments around the world have implemented stringent emission reduction targets as well as those regarding vehicles’ fuel economy.
Compared to $14.4 billion in 2019, the sale of such vehicles is expected to generate a revenue of $25.9 billion by 2025. It is also being expected that the market will witness a CAGR of 10.3% during 2020–2025 (forecast period). E-bikes have an electric motor, therefore are pollution-free.
Additionally, countries are strongly encouraging the replacement of diesel and petrol vehicles with new-energy variants, such as those that run on electricity and therefore produce no operational emissions. Among the numerous initiatives taken in this regard is the 25% (or about $1,119) subsidy granted by the Swedish government in 2018 for every e-bike, which resulted in a sale of 100,000 e-bikes in 2017–2018. Similarly, France offers a $259 financial assistance on every pedal-assist e-bike.
Another reason for the progress of the e-bike market is that these vehicles help lower urban road congestion. Numerous countries, including Switzerland, Mexico, Japan, and France, are urging people to switch to e-bikes from petrol and diesel cars, motorcycles, and scooters, for short-distance traveling. As e-bikes need less driving and parking space, they free up the roads as well as sidewalks for pedestrians. This is especially beneficial in the peak hours, when the number of office goers on the road is the highest.
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Around the world, Asia-Pacific (APAC) is the largest e-bike market, by sales volume, as it accounts for the highest sale of low-speed electric vehicles (LSEV), which include bicycles. Among the regional countries, Japan, China, and Indonesia witness the highest adoption of such automobiles, owing to their extreme air pollution levels. However, in terms of revenue, Europe held the largest share in 2019, as e-bikes are considerably more expensive here than in APAC. During the forecast period, the fastest progress, in terms of value as well as volume, would be experience by North America.
Hence, as the condition of the environment degrades further and governments encourage the use of light electric vehicles, especially for short distances, the demand for electric bicycles would also increase.