Ch10: The Wild Ride of China's Electric Two-Wheelers!

Forget sputtering gas engines and fumes that choke the city streets. We're talking silent speed wheels, weaving through traffic like electric eels.

Imagine zipping past rush-hour gridlock on two wheels, leaving smog-drenched cars in your wake as you chase the sunrise on a whisper-quiet ride. This ain't your grandpa's moped, folks!

This is the electric revolution, revving up on two wheels in the heart of China, and it's gonna leave you breathless!

Buckle up, strap on your helmet, and let's take a closer look at China's electric two-wheeler (E2W) industry, a sector that's quietly revolutionizing and reshaping urban mobility of tomorrow.

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The Humble Beginnings (1990-2000):

China's journey into electric two-wheelers began under the planned economy of the Maoist 1960s.

• However, early development efforts floundered due to technological limitations and insufficient government support.
• The E2W revolution in China started in the late 1990s as an eco-friendly solution to urban pollution and traffic congestion.
• And, by 1998, the scene transformed dramatically, with electric bicycles and scooters experiencing explosive growth- reaching a total of 56k annual sales in 1998 already.
• This surge was however not fueled by technological or manufacturing advances but by favourable local regulatory practices and incentives pushed by former Premier Li Peng under the Chinese Communist Party (CCP)’s 9th Five Year Plan. Peng was prescient enough to see the potential of electric automobiles so early on.

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The Early Sparks: 2000-2010

Fueled by scale, technological advancements and the Government’s incentives, electric two-wheelers began becoming more affordable for a chunk of Chinese users- predominantly among the rising middle class who had seen earnings rise manifold in the last few years.

• And with that demand in place, the Chinese EV players began seeing skyrocketing demand growth. So much so that in 2005 itself, the number of electric two-wheelers on Chinese roads had gone past 10 million!
• Furthermore, in just three more years, that is in 2008, this number surged to 21 million!
• For context, that’s almost the number of all kinds of two-wheelers sold in India in a year. And of course, manifold more than the total number all kinds of electric vehicles sold in India, to date, combined!

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Rapid Acceleration: 2010-2020

Identified as the central piece of the Government’s multi-faceted plan to curb pollution and clean the air in its key cities, the production of all kinds of electric vehicles became a strategic imperative for China.

With that in context, what followed was three things- Big incentives for producers, subsidies for buyers, and strong mandates on the local provincial and municipal Governments for three things.

What three things?

1. To curb the sales of fuel-burning traditional vehicles.
2. To push enterprises, industries and commercial establishments like e-commerce and food delivery platforms to switch their sleets to electric.
3. Enable and incentivise the installation of EV charging infrastructure all over to address range anxieties and build buyer confidence.

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Outcome?

The demand for electric two-wheelers grew so rapidly, that by the end of 2020, the total number of electric two-wheelers on Chinese streets had surged past 300 million mark!

That’s an unbelievable 14x growth in just 12 years!

This created monsters!

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Monsters?

• 雅迪科技集团有限公司 , AIMA, NIU Technologies , Giant, Zhejiang Luyuan, Jiangsu Xinri, Dongguan Tailing and so many more such companies have emerged and turned into massive enterprises over a matter of a few years.
• These companies today no longer just supply electric two-wheelers to the massive and still rapidly growing Chinese markets. They are also aggressively expanding abroad, particularly in the Middle East, Europe and LATAM.
• The evolution from an expensive novelty to a mainstream transportation option has changed it all!

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Future? Ever Bright!

The e-commerce and food delivery industry has been making big strides to adopt electric two-wheelers in a big way, providing a strong outlook for further industry growth.

• 阿里巴巴集团 's 菜鸟集团 : A pioneer in adopting EVs, half of Cainiao’s fleet is already electric, and is targeting a full shift in coming years. It’s food delivery business Ele.me is also nearing 50% mark.
• 京东物流 : 35% of its enormous fleet is also already electric. The a similar amount for SF Express as well.
• 美团 : China’s largest food delivery player is also nearing the 50% mark!

And particular cities like Shanghai, Beijing, and Shenzhen are leading this electric shift for logistics, with over 50% of delivery vehicles in these cities being electric.

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Conclusion

China's electric scooter revolution is more than a market trend.

It’s a testament to the country's commitment to sustainable urban mobility.

As the world grapples with environmental challenges, China's journey offers valuable insights into the potential of electric two-wheelers in shaping a greener, more efficient future.

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Subscribe and stay tuned for more updates in this fascinating saga of studying China’s rise!

See you tomorrow morning 7.30 am with another edition.

Best,

Jayant Mundhra