Electric Scooter Market Is Estimated To Witness High Growth Owing To Rising Demand For Eco-Friendly Transportation & Advancements In Battery Technology
The Electric Scooter Market is estimated to be valued at USD 24.92 billion in 2024, exhibiting a CAGR of 9.1% over the forecast period (2024-2031). Growing consumer concerns over environmental protection have driven the demand for electric mobility solutions in recent years. Furthermore, continuous innovations in battery technologies are enabling electric scooters to offer longer range per charge.
Market Dynamics:
The growth of the global electric scooter market is driven by two major factors - rising demand for eco-friendly transportation and advancements in battery technology. Increased environmental awareness among consumers has driven the demand for electric vehicles that cause less pollution compared to gasoline-powered vehicles. Electric scooters produce zero direct emissions, making them an attractive alternative to gasoline scooters or motorcycles for short-distance commuting. Additionally, continuous R&D in battery technology has improved battery capacities significantly over the past few years. Lithium-ion batteries now offer high energy density and longer range per charge compared to previous generations. This greater electric range is eliminating one of the key limitations of early electric scooters and encouraging more consumers to opt for electric models.
Market Drivers:
Rising Environmental Concerns are Driving the Increased Adoption of Electric Scooters
One of the major drivers for the growth of the electric scooter market is the rising environmental concerns amongst consumers and governments. Electric scooters offer a more sustainable and eco-friendly transportation solution compared to conventional motorcycles or cars which rely on gasoline or diesel. They produce zero direct emissions and can help reduce air pollution in cities. Many governments are actively promoting the use of electric vehicles including scooters through incentives and subsidies in a bid to lower the carbon footprint. Consumers are also increasingly gravitating towards electric options due to growing climate change awareness. Electric scooters are seen as a small yet important step towards building more sustainable cities and tackling issues like traffic congestion and pollution.
Lower Operating Costs is Another Key Driver for Widespread Electric Scooter Usage
Besides being environment-friendly, electric scooters also offer significantly lower operating costs compared to gas-powered vehicles. They are more cost-effective to charge and maintain in the long run. Regular expenses like fuel costs, engine oil changes, etc. are eliminated. Batteries last for several years before needing replacement and electricity rates are much cheaper than gasoline prices. This translates to meaningful savings for consumers and makes electric scooters an attractive economic choice even without subsidies. The total cost of ownership over the lifetime is estimated to be 40-50% lower for electric scooters. Lower operating costs increase accessibility and is a major factor influencing more individuals and organizations to opt for electric mobility solutions.
Market Restraint:
High Upfront Purchase Price Hinders the Mass Adoption of Electric Scooters
One notable restraint impacting the electric scooter market currently is the higher upfront purchase price compared to gas-powered scooters or motorcycles. Lithium-ion batteries which power electric vehicles are expensive and account for a significant portion of the manufacturing cost. Battery technology is still evolving and mass production has not yet scaled to bring down prices substantially. The high initial investment required deters many cost-conscious buyers, especially in price-sensitive developing markets. Even with subsidy support, electric scooters remain significantly more expensive to buy upfront. Overcoming this price barrier through innovation, economies of scale and new business models is essential for the market to reach its true potential.
Range Anxiety Restrains Wider Consumer Acceptance
Another major concern holding back the mass adoption of electric scooters is the issue of range anxiety. Most electric scooters currently have a maximum driving range of 50-100 km on a single charge which is significantly lower than gasoline counterparts. While sufficient for daily commutes within cities, it introduces range limitations. Consumers fear being stranded with a drained battery if longer unplanned trips are required. Absence of widespread public charging infrastructure also increase range anxiety. Improving battery capacity/energy density and expanding fast charging networks are critical to alleviate consumer worries and boost confidence in electric scooters for diverse mobility needs. Until these issues are adequately addressed, range limitations will continue restraining wider consumer acceptance of electric scooters.
Market Opportunity:
Declining Battery Prices Present a Huge Market Opportunity
One of the biggest opportunities in the electric scooter market come from the declining battery prices anticipated over the next 5-10 years. As manufacturing scales up globally to meet the rising EV demand, battery costs are forecast to plummet dramatically - having fallen 87% since 2010 and projected to drop another 60% by 2030. This will substantially lower the production cost of electric scooters and reduce or potentially eliminate the price differential compared to gasoline models. As upfront costs become increasingly competitive, it could unleash explosive market growth potential, especially in price-sensitive markets. Battery technologies with higher energy densities will also extend scooter range, easing adoption barriers. Lower prices will boost accessibility and affordability, stimulating much larger sales volumes for manufacturers.
Growing Micro-mobility Trend Presents an Opportunity for Expansion
The rapid growth of the micro-mobility trend, especially among urban millennials, presents a massive market opportunity for electric scooters. New on-demand rental models introduced by startups are catalyzing demand. They provide affordable, convenient point-to-point transportation alternatives to private vehicles within cities. Growing investments are expanding these shared fleets and related infrastructure in more cities. This exposes many new users to electric scooters and their benefits. As micro-mobility gains wider acceptance and integration into public transit networks, it could drive incremental but significant sales growth. New services, business models and first-mile last-mile connectivity also create white spaces for scooter makers to explore.
Link - https://www.coherentmarketinsights.com/market-insight/electric-scooter-market-1717
Key Developments:
- On June 5, 2024, Terpel, a Colombia-based fuel and lubricants company, and Gogoro Inc., a global leader in battery-swapping ecosystems for sustainable urban mobility, launched Gogoro Inc.’s battery swapping service in Bogotá, Colombia, under the Terpel Voltex brand. They also introduced the Gogoro 2 Plus and Gogoro VIVA MIX Smartscooters.
- In January 2024, Riley Scooter, a Cambridge-based company, announced plans to introduce the RS3 Electric Scooter, a fully foldable model, in the U.S. at the Consumer Electronics Show in Las Vegas
- In January 2024, Hero MotoCorp announced plans to enhance its electric vehicle (EV) offerings by launching three new electric scooters in 2024. These new models will cater to the mid-range, affordable, and business-to-business (B2B) segments to meet various usage needs.
- In December 2023, Gogoro unveiled the domestically produced Gogoro CrossOver GX250 electric scooter in India, customized for Indian riders. This move marks a strategic effort by Gogoro to enter the Indian electric scooter market. Additionally, Gogoro launched battery swapping services in Delhi and Goa and partnered with Hero MotoCorp to co-develop vehicles and swapping infrastructure in India.
Key Market Players:
Key companies covered as a part of this study include AIMA Technology Co., Ltd., Ampere Vehicles Pvt. Ltd., Aprilia, Ather Energy Pvt. Ltd., BMW AG, Gogoro Inc., Harley-Davidson, Inc., Hero Electric Vehicles Pvt Ltd, Honda Motor Co., Ltd., Lightning Motorcycles Inc., Niu Technologies Inc., Ola Electric Mobility Pvt. Ltd., Piaggio Group, Super Soco, Suzuki Motor Corporation, Vectrix GmbH, Vespa, Yadea Technology Group Co., Ltd., Yamaha Motor Co., Ltd., and Zhejiang Luyun Electric Vehicle Co., Ltd.
