1. Business

Why Are People of Asia-Pacific (APAC) Buying Electric Scooters and Motorcycles?

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“By 2050, it is projected that India will have added 416 million urban dwellers, China 255 million and Nigeria 189 million.”, says the United Nations (UN) in its 2018 Revision of the World Urbanization Prospects report. With millions pouring in from rural areas into cities in search of a better life, urban areas are becoming increasingly congested. Moreover, with an increase in their income, the new urban dwellers are purchasing automobiles, which have already become a bane for the environment. India, China, Pakistan, and Japan are now consistently ranked as the most-polluted countries in the world.

As per P&S Intelligence, this will be the strongest factor behind the growth of the Asia-Pacific (APAC) electric scooters and motorcycles market sales volume to 31.2 million units by 2025. Since the transportation sector is one of the largest contributors to this problem, its cleaning is being taken rather seriously by regional countries. For this, India has implemented the Bharat Stage 6 emission norms, which have made petrol and diesel vehicles quite expensive and subject to intense regulatory scrutiny.

However, to make it easier for people to own a vehicle amidst these rising prices of not only conventional vehicles but petrol and diesel as well, governments in the region are offering strong support for the production and adoption of electric vehicles (EVs). For instance, under the FAME India II scheme, the Indian government is investing INR 10,000 crore, of which INR 2,000 crore will be spent on giving purchase subsidies and other demand incentives on electric scooters and motorcycles.

The idea is that since a lot of the trips taken around cities are across short and medium distances, they can be easily accomplished on two-wheelers. If more people shift from cars to two-wheelers, not only will the carbon emissions decrease but the space on the road for pedestrians will grow too. By replacing internal combustion engine (ICE) two-wheelers with electric variants, the emissions will come down even more.

Another factor that will facilitate the adoption of these automobiles will be the reducing prices of lithium-ion (Li-ion) batteries. Even though sealed lead–acid (SLA) batteries are more popular in EVs because of their primitive technology and lower costs, they contain lead and acid, both of which are toxic to the environment and human skin. Therefore, the concerns being raised over their improper disposable are slowly tipping the odds in the favor of Li-ion batteries. Additionally, companies that manufacture these energy storage devices are carrying out extensive technological advancements.

These improvements have not only reduced these batteries’ cost but also given them a higher energy density, which is necessary to offer EVs a longer driving range. Presently, most of the electric vehicle charging stations are slow variants that can take up to 8 hours to charge the EV battery depending on the battery size and capacity. Therefore, fleet operators, who have to drive their two-wheelers non-stop, face revenue loss by grounding these vehicles. As a result, a longer driving range for these vehicles is essential, as presently, most of them are being adopted by last-mile delivery and shared mobility providers.

Currently, China is the largest country in the APAC electric scooters and motorcycles market due to the extensive government support. Being the country with the worst air quality in the world, China has taken the task of cleaning up its transportation system more seriously than any other country. As per the International Energy Agency (IEA), China had almost 25% of the 350 million electric two-wheelers in operation across the globe. Apart from government support, their local manufacturing and that of the batteries have made these automobiles cheaper here than anywhere on earth.

Hence, with the increasing environmental concerns and rise of the shared mobility culture, electric scooter and motorcycle sales will continue to burgeon in APAC.

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