EARTH DAY ACTION: RIDE AN ELECTRIC BIKE!
SEBASTAPOL, Calif (April 23, 1998) -- The following article is written by
Ed Benjamin for Earth Options Institute. Ed Benjamin is a regular
contributor to BDS Magazine, Bicycle Retailer and Industry News, NBDA
Newsletter, GorillaNet, and the Coffrin Newsletter. He is a former bicycle
retailer, and has been associated with the bike industry for over 20 years:
Ask anyone about electric vehicles, and you will hear, "It's a good
idea, but, you know, the battery technology just isn't there yet." Well,
the good news is that the world has changed, and affordable electric
vehicles are here today, in the form of electric bicycles.
For complete article see zapbikes.com
EARTH DAY ACTION:
RIDE AN ELECTRIC BIKE!
by Ed Benjiman
SEBASTAPOL, Calif., April 21 /PRNewswire/ -- The
following article is written by Ed Benjamin for Earth Options
Institute. Ed Benjamin is a regular contributor to BDS Magazine,
Bicycle Retailer and Industry News, NBDA Newsletter, GorillaNet,
and the Coffrin Newsletter. He is a former bicycle retailer, and has
been associated with the bike industry for over 20 years:
Ask anyone about electric vehicles, and you will hear "it's a
good idea, but, you know, the battery technology just isn't there
yet." Well, the good news is that the world has changed, and
affordable electric vehicles are here today, in the form of electric
bicycles.
Detroit icon Lee Iacocca told the story at 1997's International
Electric Vehicle Symposium in Orlando, FL about how Thomas
Edison promised Henry Ford a battery and motor that would be
practical for an auto, back in the 1930s. "70 years later," said
Iacocca, "we still don't have it."
Iacocca is right. Electric cars are tantalizingly close, but still
in the future. If you look at an electric car through the paradigm of
today's fossil fuel auto, they don't go as far, are more expensive to
buy, don't have good heaters or air conditioning, are a pain to
recharge, and are tough to get service for.
The most popular vehicle in the world today is the bicycle.
There are over 1.4 billion bicycles in service today, and only about
340 million cars. Far more humans ride a bicycle every day than
drive a car. So it should be no surprise that Iacocca's newest
business venture is to build and market electric bikes and scooters.
Let's look at the electric bike.
HOW DO THEY WORK?
Electric bicycles can go farther and faster than conventional
bicycles. The electric bicycle is easier to pedal, a LOT easier!
Heaters and air-conditioners are non-issues. They can be quickly
recharged almost anywhere, or batteries can be exchanged
instantly, like cellular phones. They can be serviced by any bicycle
repair facility, from the high-end bike shops of Europe to the
street-corner repairmen of India and China. They look great, and
the price, performance, quality and comfort of existing electric
bikes makes them very attractive to consumers.
In the U.S. the "bicycle business" has limited itself to
customers who were willing to, or even wanted to, sweat and
exercise on a bicycle. That's about 3 million of the 265 million
people who live in the U.S. Given that about 20% of human beings
cannot ride a bike, because of age, illness or injury, that leaves
about 209 million people who could be, but are not, bike customers.
Since you do not have to sweat, and the electric bike is easier to
ride and more comfortable than a conventional bike, this huge
number of people represents a market for this technology. The
market for EBs could be twenty times the market for bicycles.
Remember that every time the bicycle has become easier to pedal,
or more comfortable, sales have boomed. Just think of the balloon
tire in the 30's, the English Racer in the late 50's, the 10-speed in
the 70's, and the Mountain Bike in the 80's.
WHO WILL THEY BUY THEM?
Americans love nature and the out of doors, it is part of our
national heritage. Unfortunately, too many people have come to
experience nature out the window of a car, while sliding down a ski
slope, or on TV. Given the opportunity to enjoy the out of doors on
a silent, affordable steed, millions will choose to do so. But most of
them prefer not to sweat. The EB will suit many millions of these
folks. It is silent, does not stink or vibrate, is inexpensive and
reliable.
Electric Bikes don't just appeal to recreational riders, they
cut across many other market segments. Seniors want to get
outdoors and get exercise, but are not always able to pedal
themselves up a hill. Older folks are already the biggest market for
EBs, and that will continue for a while. Aging Baby Boomers are
finding that gravity is getting more irksome every year. Historically
fitness and outdoors oriented, they are going to turn to EBs as a
way to extend their present habits and preferences.
Commuters, frustrated with traffic congestion, and rising
costs of car ownership, find EBs a very practical transportation
choice. Keep in mind also that EBs require no driver's license,
insurance or registration, which makes them very appealing to
people who cannot get a license to drive, because of age or driving
record. If we could just sell an EB to every DUI out there....
Folks coming off the welfare rolls in today's booming
economy, but who cannot afford a car, will find electric bikes give
them independence and freedom of movement.
And fitness riders will be glad to hear that electric bikes
promise to be a potent fitness tool. When used as a power assisted
bike, the rider's input is significant, and can continue over a longer
period of time than on a regular bike. Longer workouts as a result
of an easier to pedal, more comfortable bike mean better results.
One of the most significant markets to date has been police
and other law enforcement agencies. A bicycle cop that arrives at
the scene out of breath learns to appreciate electric power quickly.
The police officer on an electric bike will often be the first on the
scene, beating both patrol cars and conventional bicycles.
EBs are also proving popular with meter readers, park
rangers, golf course workers, industrial users, indoor plant
messengers, and countless other categories of workers. Delivery in
traffic congested areas is already a major use of the bicycle.
Electric bikes will allow those workers to be more productive.
WHEN IS THIS ACCEPTANCE GOING TO HAPPEN?
Yesterday! Look around. Not at the U.S.-look at the world.
In the first eight months of 1997, Japanese bicycle companies built
more than twice as many electric bikes as mountain bikes. And, the
dollar value of the electric bikes made them a whopping 18% of the
total gross sales of bicycles in Japan. That was up 240% over 1996.
Current estimates in Japan peg 1997 sales at 225,000 units.
China production numbers are unknown, but rumor has it that
15% of domestic Chinese bicycle production will be electric by
2001, a number which could mean that 5 million EBs would be
zipping along the streets of China! Other regions' 1997 sales
estimates: Taiwan: 35,000 units; Europe: 15,000 units; U.S. 8,000
units. Total for the world, not including mainland China: 341,000 in
1997, with an estimated cumulative total units sold world wide of
about 651,000 units since 1993.
That is more units than many major bicycle builders will make
in a year. It is more units than many countries will buy in
conventional bikes in a year. And the rate of growth is a classic
"hockey stick curve".
If 1996 to 1997 can run a 240% increase in Japan...If Iacocca
is predicting a 50,000 unit first year (That would represent a 500+%
plus increase for sales in the U.S.)...If Bob Stempel (former
chairman of GM), Malcom Currie (former CEO of Hughes) and
other noted authorities on transportation technology are rolling
their personal dice on the future of the electric bike...If every major
U.S. Bicycle Company is developing or exploring EBs... We only
need an average 20% annual rate of growth worldwide to achieve a
level of 2 million EB units worldwide by 2003. And a 3 million unit
level will be reached if the industry simply achieves an average
growth of 50% per year. How fast did mountain bikes grow for their
first 5 years? Mountain bike sales doubled every month from the
introduction of the first production mountain bike, the Specialized
Stump jumper in 1981 through 1983, and continued to grow at a
milder, but spectacular pace into the 1990's. The limiting factors
were how fast factories could tool for production. And note that
mountain bikes require sweat and effort... much more limited appeal
than EBs.
It is entirely reasonable to predict that EBs will be 3-4 million
units per year within 3-5 years. That is only 10 times this year's
production, and the business has yet to get its feet under itself. If
EBs grow like mountain bikes did, then we will look back and laugh
at the conservative projections of 1998. If only 5% of the current
bicycles in the world become electric, we are looking at a $50 billion
industry!
WHO WILL BENEFIT?
Everyone will benefit from having improved access to
efficient and clean transportation. Massive social, economic and
environmental benefits that will be gained by reducing petroleum
dependency, air pollution, and greenhouse gas emissions. Many
specific interest groups also stand to gain from the growth of this
industry.
Electric motor makers will sell millions of motors. Technology
that was developed at enormous cost for electric cars ($500+ million
was spent on research in 1996 alone) is making low cost,
lightweight, high efficiency motors available that deliver far more
power.
Battery makers will sell millions of units, not only at OEM for
production, but to replace aging battery packs, and to upgrade
earlier versions as battery technology continues it's rapid evolution.
Hundreds of millions have also been spent developing batteries for
cars, batteries that will see their first widespread use on bicycles,
scooters and ultra light electric vehicles.
Investors in electric bicycle producers, motor producers, and
battery companies stand to benefit greatly. Today there are only a
handful of public companies that have strong interests in the EB
industry, Bat International, (OTC BB: BAAT) Unique Mobility
(AMEX: UQM) and ZAP Power Systems (OTC BB: ZAPP). ZAP is
the only publicly owned company that is completely dedicated to the
electric bike and electric scooter industry and is the only company
currently in full production. This Earth Day ZAP is even opening up
two new "Electric Vehicle Outlets" in Maui and Michigan (in
addition their existing stores in San Francisco and Shanghai) The
stores double as rental outlets so consumers can experiment with
EBs before buying one. ZAP says this year it will open EV Outlets
in several major metropolitan areas around the country.
The normally staid transportation industry is about to see an
explosion of vehicle choices for consumers, with electric bikes
paving the way for a diverse array of small and lightweight vehicles,
including electric scooters, and electric power boards. Early
investors could find themselves participating in providing the world
with one of the most universal and fastest growing products in
human history.
Bicycle retailers will have a dynamic product to re-energize
their painfully mature industry. And bicycle manufacturers will
experience a new, high margin product. Even if only 3% of all new
U.S. bicycle units become electric (achieving 4.5 million units per
year), the higher value of those units will become important profit
centers to bike makers.
Transportation Planners and urban designers will have a
popular transportation tool that will decrease air pollution, increase
the capacity of roadways by reducing auto trips, and will help
produce improvements in service levels, emissions, congestion, and
parking demands. California and other states have mandated
certain percentages of vehicles sold there to be electric. These
percentages could be met with EBs and other light EVs. Federal and
State agencies should shift some of their support to include Electric
Bikes. If their goals of public subsidies and mandates are to cut
pollution, EBs are much more cost effective than the millions given
only to Detroit.
Distributors and entrepreneurs who begin to specialize in
marketing, renting and selling electric bikes will benefit as well as
being know as "the first" in their region. Perhaps early EB
franchisees will in the future be as enviable as the early franchisees
of horseless carriages, or those now-universal golden arches.
Power companies, under a new era of utility deregulation, are
getting involved in the marketing of electric bikes to sell more
power, attract more customers and even bring in new profits.
Already Cental and South West Corp. of Dallas (NYSE:CSR) is
marketing electric bikes and scooters in its service territory.
WHICH PRODUCTS?
With 1.4 billion bicycles in the world, it is obvious that a huge
opportunity exists for the builders of kits that can electrify a
conventional bicycle. And given human nature and economic reality,
the company with a low cost unit, especially one offered in Asia, will
have great success.
Complete bicycles that operate on the concept of the rider
pedaling to activate an electric motor that adds power to the rider's
efforts are enjoying some success.
Complete bikes that are controlled by a throttle will be
popular in many countries. Already dominant in China, (although
today they are gas powered) they are likely to be popular in much of
Asia, the U.S. and Europe. Lower priced units are likely to be the
dominant product.
Electric scooters and other small electric vehicles should also
enjoy greater success, aided by the general awareness of electric
bikes and the need for non-polluting transportation.
Wonderful things will happen in the near future!
Transportation choices for consumers are about to become as
diverse and rapidly changing as the consumer electronics industry is
today. The electric bikes of today and the next few years are going
to pave the way technologically, and psychologically, for other
electric vehicles and electric autos.
Electric vehicles are going to replace most applications of
gasoline and diesel personal vehicles. Traffic noise, pollution, and
the dominance of the automobile is about to start a rapid decline.
Many cities that have reached gridlock such as San Paulo, Brazil
and Tokyo, Japan are seeing the bicycle and E-bike become the
preferred mode of travel over the slow moving gas car. Many of us
will try to explain gasoline-powered transportation to our
grandchildren, who will be astounded that anyone ever wasted
petroleum in such a way, or was willing to breathe such noxious and
poisonous emissions.
For more information on electric bikes visit
zapbikes.com.
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