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E-Cargo Bikes Overtake Urban Delivery

October 2021

E-commerce accelerated significantly in the past 18 months, resulting in a 5-10 year growth jump. This has significant impact on last mile delivery activity where about half of the total delivery costs are incurred. Conversely, the pandemic has also accelerated restrictions on personal and ICE vehicles in urban centers and triggered the creation of hundreds of km of bike lanes, mainly in Europe. As a result, electric cargo bikes sales are booming, as are those for electric bikes in general.

 

The e-bikes category built significant momentum in 2020. In Europe, it enjoyed a massive 52% increase in sales. In 2020, this represented 11B€ or 60% of all bike sales in value, up from 3.3M units in 2019 — of which 1.4M in Germany alone. In the USA, e-bikes sales grew even faster at a reported 145% in 2020 — though from a much lower baseline — and are expected to reach 1M units in 2021.

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The e-cargo bike market is experiencing a similar growth spur. Annual sales amount to about 100,000 units in Germany, the leading European market, with about 40% of regional sales, and 50,000 in France. These numbers are expected to increase by about 60% in 2021. It is interesting to note that these vehicles are not only sold for business use, but also for personal use.

 

The growth of e-cargo bikes results in part from regulations that constrain other modes but there is more to it. They also bring about higher business efficiency. E-cargo bikes enable roughly 60% faster deliveries than conventional vans in city centers according to a recent study. They were also found to reach higher average speed and delivery performance with 10 parcels per hour vs. six for vans, which significantly reduces unit labor cost. According to EU-commissioned research, 50% of light deliveries in urban environments could be completed by cargo bikes.

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Logistics companies play a key role in the modal shift to 2- and 3-wheelers, whether they be startups or incumbents. For instance, global logistics leader DHL grew its German fleet of e-bikes and e-trikes from 10k in 2017 to 12k to 2019 and 17k in 2021 (roughly half of each type now), and plans to add 5k e-trikes by 2025. In France, logistics leader La Poste was already operating 19k e-bikes for its daily deliveries in 2020. The company is planning to shift its fleet towards e-trikes. 

 

E-bikes and e-cargo bikes are not treated the same way in all regions. In Europe, the maximum power allowed is 250 W (average) and electric assistance must cut off at 25 km/h. More powerful vehicles — including those for cargo — are treated as scooters/mopeds and must undergo a type-approval. However, the legislation is being reviewed to support innovation in this space. In the USA, bikes can be more powerful at 750 W and reach 32 to 45 km/h depending on the class. 

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Cargo bikes and trikes come in different form factors. The above infographic, featured in a report by UK-based charity Possible, presents various configurations, where cargo can be installed in front or behind the rider. E-trikes, such as Coaster Cycle or Fulpra (above), have a max payload of 350 kg. Other options include bikes paired with trailers, which can be self-powered. K-Ryole (below) offers a cargo trailer with a 3 kW motor controlled by a force sensor fitted on the tiller. Alternatively, PeddleSmart has developed a quadricycle paired with a trailer.

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At the heart of the growing e-bike and e-cargo bike markets is the e-drive. Whereas cheaper e-bikes are fitted with hub motors, more sophisticated and/or capable ones are powered by Mid Drive Units (MDU) generally combined with a rear derailleur. The market is currently dominated by Bosch, Bafang, Shimano, Brose and a few others. Valeo recently introduced a MDU combining a 750 W motor (130 Nm peak), an automatic 7-speed transmission and the controller in a single unit. It even offers a reverse gear to pull a heavy cargo back up on a steep street and a pedal disconnect feature to mitigate theft.

 

Light mobility is clearly building momentum in the modal mix, especially with vehicles that are electrically-assisted. It only makes sense for light 2-, 3- or even 4-wheelers to replace 2t-vans, be they electric, to deliver small packages in urban centers. These vehicles have a bright future.

Marc Amblard

Managing Director, Orsay Consulting

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