This post is one in a series of feature stories on trends shaping advanced energy markets in the U.S. and around the world, drawn from Advanced Energy Now 2015 Market Report, which was prepared for AEE by Navigant Research. 

Photo courtesy of AEE member Genze.

A generational shift in the United States is underway when it comes to car culture. While there are a number of contributing social and economic factors, over the last decade, the number of miles driven by the average American has been falling. At the same time, advanced mobility options, drive trains, and fuel sources have increased significantly. Growth in public transit options, car-sharing, and electric vehicles are all contributing to the transformation of personal mobility. Millennials in particular are seeking alternatives to car ownership while decreasing battery costs are making electric mobility products more affordable.

One of the fastest growing industries is the electric power two-wheeler (e-PTW) industry (including e-bicycles, e-scooters, and e-motorcycles). The United States is expected to achieve significant growth over the coming years as new products become available and several large manufacturers enter the market. 

While current sales in the U.S. are relatively low due to high purchase prices, low consumer awareness, and limited product offerings, this is expected to change in the coming years. For the 2015-2024 time period, Navigant Research projects a CAGR of 38.4% in the U.S. e-motorcycle market, 17.9% in the e-scooter market, and 5.5% in the e-bicycle market. 

Source: Navigant Research 

While the e-motorcycle market is currently the lowest volume e-PTW market in the U.S., it is also the most likely high-growth area. This is largely due to the current size of the gasoline-powered motorcycle market and the expected market entry of several large industry players over the next few years. The acquisition of Brammo by Polaris Industries in January of 2015 has kick-started this process. Polaris owns the Indian and Victory lines of motorcycles that are often referred to as Harley-like road cruisers. While the existing inventory of e-motorcycles from Brammo will be sold, future products are expected to take the style of Polaris’ Indian and Victory brands. The company is planning to release an electric version of the Victory in the summer of 2015. 

With 5,400 employees and revenue of over $4.4 billion in 2014, Polaris is the first large motorcycle manufacturer to seriously enter the e-motorcycle space.  Yamaha, one of the Big Four Japanese motorcycle manufacturers (along with Honda, Kawasaki, and Suzuki), has announced its intention to enter the market in 2016, and Navigant Research projects that Harley Davidson will begin selling their much anticipated LiveWire e-motorcycle in 2018.  Big brand recognition, expansive dealer networks, and improved products (expected due to large R&D budgets), is expected to significantly increase the market size of North America’s e-motorcycle industry.

Currently, China is by far the largest market for e-PTWs. However, restrictions on urban transportation, the maturity of the market, and lower than expected GDP growth are resulting in a stagnating market. Manufacturers are looking to several emerging markets around the world to maintain and increase sales.  Countries such as the U.S., as well as Indonesia, India, Thailand and Vietnam are likely to be major targets. 

Estimated e-PTW Market Share, China