In 2023, the global market for electric two-wheelers reached a total value of $22 billion. The market will reach $ 84.54 billion by 2031, expanding at a compound annual growth rate (CAGR) of 16.47% from 2024 to 2032. Increasing use of electric motorcycles and e-scooters for short commutes, rising environmental concerns, and rising expenditures by ride-hailing companies in the micro-mobility sector are the primary market forces encouraging industry expansion. Throughout the time covered by this prediction, it is expected that the use of electric two-wheelers (also known as e-scooters) would increase due to the growing concern about greenhouse gas (GHG) emissions and carbon emissions, as well as the increased demand for fuel-efficient automobiles. Stringent pollution regulations set by government agencies are driving the growth of the electric two-wheeler sector. The Environmental Protection Agency (EPA) of the United States imposes emission regulations for greenhouse gas emissions, along with BS-VI in India and China.
Increasing environmental awareness is the key element driving the expansion of the electric two-wheeler industry. This is owing to the fact that an increasing number of people are becoming aware of the need of reducing pollution levels, and this newfound awareness has spurred them to seek out environmentally friendly and pollution-reducing modes of transportation. According to the findings of a Forbes poll, the level of environmental consciousness among Dutch customers has improved to the point that sales of electric bicycles have eclipsed sales of non-electric bicycles in the country. Because carbon dioxide emissions from the combustion of fossil fuels continue to pose a severe threat to the environment by contributing to global warming and climate change, it is expected that the number of people utilizing electric two-wheelers will rise in the coming years. This is due to the fact that carbon dioxide emissions contribute to both phenomena. The two most significant trends in the two-wheeler sector that have opposite effects are the expansion of the e-commerce industry and the increase in the sales of electric cars. Given that electric mobility is the future, it makes sense for firms that specialize in e-commerce and last-mile deliveries to incorporate electric two-wheelers in their fleets.
The ecosystem supporting electric scooters has evolved at an exponential rate as a result of variables such as high availability, low pricing, and ease of operation. Price is the most significant consideration for a customer when selecting a service. The affordability of electric scooters as a form of transportation has prompted customers to purchase these vehicles. In addition, the government has recognized the possibility of electric two-wheelers serving as a substitute for gas guzzlers.
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Lead-acid batteries are comparatively heavier and less efficient than their lithium-ion counterparts. Nonetheless, there have been incidents of lithium-ion batteries catching fire, causing some cause for concern. Because lithium-ion battery packs are composed of hundreds of individual battery cells, there is a possibility of thermal runaway and an internal battery fire. The worst-case situation, however, is that the increase in pressure generated by the increased temperature causes the cell to burst open, which then rapidly heats the surrounding cells. Eventually, hundreds of cells will encounter thermal runaway, which will result in a fire.
The two submarkets of electric two-wheelers are electric motorcycles and electric scooters. In terms of revenue, the electric scooter market segment was the most dominating in 2023, while the electric motorcycle market segment is predicted to have the highest CAGR from 2024 to 2032. This might be ascribed to the greater availability of a variety of electric scooter models, as well as their earlier introduction and more inexpensive cost in important global regions. Conventional producers of two-wheeled vehicles have an additional reason to consider entering the market: the rising popularity of electric scooters. Electric scooters have proven to be more popular than electric motorbikes due to their lower starting price and a broader choice of available types.
The electric two-wheeler market is divided into sealed lead acid and lithium-ion battery segments. The sealed lead acid market dominated the market in 2023. Yet, the lithium-ion segment is predicted to be the most lucrative between 2024 and 2032. This is a result of its reduced price and greater compatibility. Original equipment manufacturers (OEMs) are increasingly preferring Li-ion batteries due to their environmental friendliness and a variety of other advantages. Thus, this would have a positive effect on the growth of the electric two-wheeler market.
APAC was substantially dominant in 2023 and is anticipated to maintain its dominance during the period from 2024 to 2032. There has been a clear acceleration in the rise of global sales of electric two-wheelers over the past few years, particularly in China and Vietnam, where electric two-wheelers account for ten percent of the overall sales of two-wheelers. Given India's ambitious intentions for the electric two-wheeler sector, it is potential for India to become the second-largest market in APAC. Although the Minister for Road Transport and Highways has indicated that the government's goal is to reach an 80% market penetration of electric two-wheelers by 2030 in terms of sales, original equipment manufacturers (OEMs) anticipate a lower market penetration.
In the year ending in March 2020, 18% of Japan's total energy consumption comes from renewable sources. Japan's current aim ranges from 22 to 24 percent, which is much lower than the goals set by European nations such as Spain (74 percent), Germany (65 percent), and Italy (75 percent) (55 percent). Hence, the expansion of the electric two-wheeler market in Japan is being driven by government incentives for the products and the region's developing renewable energy sector. There are expected to be opportunities in the Japanese electric scooter market's vintage, standing, and folding scooter segments in the future, which bodes well for the market's prospects. Growing consumer awareness of eco-friendly modes of transportation, rigorous environmental restrictions, expanding government incentives and subsidy programs, and increased use of e-scooter-sharing services are the major factors driving this industry.
Hero Electric Vehicles Pvt. Ltd., Ideanomics Inc., Vmoto Ltd., Yadea Technology Group Co., Ltd., Greaves Electric Mobility Pvt. Ltd., Zero Motorcycles, Inc., Niu Technologies, Ola Electric Mobility Pvt. Ltd., F-wheel DYU, Sanyang Motor Co., Ltd., Jiangsu Xinari E-vehicle Co., Ltd., Zhejiang Luyuan Electric Leading market participants are spending in R&D to expand their product offerings, hence contributing to the growth of the electric two-wheeler sector. Market participants are also engaged in a number of strategic initiatives, including the introduction of new products, the formation of contractual agreements, the completion of mergers and acquisitions, the increase in the number of investments made, the development of the market, and the collaboration with other organizations.
