Two wheeled electric vehicles have gone crazy overseas.
On social media platforms such as Xiaohongshu, more and more overseas users are sharing pictures of themselves encountering foreigners riding electric bikes in New York, London, and other places, and expressing surprise that they seem to have instantly traveled back to the streets of China.
What's even more unexpected is that many of these popular overseas "little electric donkeys" are made in China. Chinese electric donkeys have quietly carved out a bloody path in the international market.
Two wheeled electric vehicle manufacturers collectively enter the market
From January to July this year, the export value of two wheeled electric vehicles in China reached 20.63 billion yuan, a year-on-year increase of over 9%. China has become the world's largest exporter, manufacturer, and consumer of two wheeled electric vehicles.
Among the domestic two wheeled electric vehicle manufacturers that are expanding into overseas markets, they can be roughly divided into traditional brands represented by Yadea, Aima, Tailing, and Xinri, emerging brands represented by Xiaoniu Electric and No. 9 Company, as well as cross-border players represented by DJI, which announced its entry into E-bike, and Harrow, which is expanding into shared electric vehicles overseas.
These brands are all "venturing into the sea" and choosing to expand overseas, mainly because the "old for new" dividend period has passed and the domestic market has been fully saturated.
On April 15, 2019, the "Safety Technical Specification for Electric Bicycles (GB17761-2018)" was officially implemented, requiring electric bicycles to be equipped with pedals, and the entire vehicle, electric motor, and charger sockets must also have the 3C mark, with a speed limit of less than 25 kilometers per hour.
After the implementation of the new national standard that strictly regulates product parameters and management qualifications, relevant illegal electric vehicles will be prohibited from being driven on the road, otherwise fines and vehicle seizures will be imposed. This has also led to the elimination of a large number of small brands and non compliant miscellaneous brands, while old brands such as Yadea and Aima, as well as new car making forces such as Xiaoniu and Jiuhao, have risen rapidly with their scale advantages and technological innovation capabilities.
The 'dividend period' will eventually come to an end. In 2022, with the replacement of most old two wheeled electric vehicles, the demand for new national standards has been completed by more than 80%, and market demand is weakening.
According to research data from iResearch Consulting, the sales volume of two wheeled electric vehicles in China is expected to reach approximately 55 million units in 2023, a decrease from the previous year. Huachuang Securities also predicts that the compound annual growth rate of industry sales will decrease from 18% in 2019-2022 to 5% -10% in the next three years.
This trend directly affects the performance of domestic two wheeled electric vehicle companies. According to the latest performance report, Aima Technology achieved a revenue of 6.873 billion yuan from July to September, a year-on-year decrease of 5.05%; The net profit attributable to the parent company was 603 million yuan, a year-on-year decrease of 9.02%.
Veteran player Emma's revenue and profit both declined in the third quarter, and as the biggest beneficiary of the "trade in" policy, Yadea, which has the highest market share, is also struggling.
According to the disclosed 2024 interim report, Yadi Holdings achieved a revenue of 14.414 billion yuan in the first half of the year, a year-on-year decrease of 15.4%; The company achieved a profit attributable to shareholders of 1.034 billion yuan, a year-on-year decrease of 12.9%.
This is the first time since 2020 that Yadi Holdings' semi annual performance has experienced a year-on-year decline. Sales have declined and performance has slowed down. Faced with the sluggish domestic market, it is no wonder that domestic two wheeled electric vehicle companies have chosen to collectively enter the market.
In fact, seeking new growth opportunities in overseas markets is indeed an opportunity comparable to the introduction of new national standards for domestic two wheeled electric vehicle manufacturers.
On the one hand, according to data from overseas research institution MRFR, the global market size of two wheeled electric vehicles will exceed $100 billion by 2030, and the compound annual growth rate of the global two wheeled electric vehicle market from 2022 to 2030 will be 34.57%.
The penetration rate is relatively low, and the market size is huge. The overseas two wheeled electric vehicle market is clearly an untapped "rich mine".
On the other hand, carbon reduction has become a global consensus, and many countries have encouraged residents to switch from buying cars to purchasing two wheeled electric vehicles through subsidies.
In March 2023, the US government resubmitted the E-bike Act, which proposes to provide a 30% tax credit on the purchase price of a new two wheeled electric vehicle; In August, the French government increased the subsidy for exchanging gasoline cars for electric bicycles to 4000 euros per person.
Southeast Asian countries have also proposed relevant policy subsidies. Indonesia and Thailand have decided to provide subsidies equivalent to more than RMB 3000 per electric motorcycle starting from this year. The Philippines has proposed to provide import tariff reductions for electric motorcycles, electric two wheelers, and their components for the next five years starting from this year .....
However, despite the overseas market appearing to be an untapped "gold mine", domestic two wheeled electric vehicle brands still need to overcome numerous challenges in order to rise again in this blue ocean.
Difficult to rely on overseas markets to overcome difficulties
At a time when the domestic two wheeled electric vehicle market is experiencing contraction and slowing growth, the overseas market is showing a vigorous growth trend, and the overseas strategy has quietly become a "compulsory course" for domestic two wheeled electric vehicle manufacturers.
However, in order to steadily move forward on this path and successfully 'graduate', three major 'mountains' need to be crossed.
The primary challenge lies in the high dependence of two wheeled electric vehicle products on offline experience and service networks.
Although brands can attract customers and facilitate transactions through online marketing, offline channels still play an irreplaceable role in core processes such as vehicle selection, delivery services, and subsequent maintenance and repair.
However, the operating costs of stores in overseas markets, including rent, labor, and warehousing expenses, have significantly increased compared to the domestic market.
Although brands such as Xiaoniu Electric and Jiuhao have entered international e-commerce platforms such as Amazon and eBay in an attempt to expand their sales channels, most consumers still prefer to make decisions after experiencing them firsthand, and offline stores are still the key bridge to reach their target customer base.
Therefore, how to effectively integrate online and offline resources while controlling the cost of overseas stores has become one of the urgent problems that domestic two wheeled electric vehicle manufacturers need to solve.
Secondly, the demand for two wheeled electric vehicles in various regional markets around the world presents diversified characteristics. The European and American markets prefer mid to high end electric motorcycles and electric assisted bicycles that combine commuting and leisure functions; The Southeast Asian market focuses on cost-effectiveness, with mid to low end lightweight models as the dominant force; Due to the complex terrain, high-power electric motorcycles are more popular in South American countries .....
Faced with these cultural differences, two wheeled electric vehicle brands need to use intelligent technology to reshape their product lines and provide customized services for different regions in order to steadily move forward on the path of internationalization.
Finally, domestic competition is severe, but the competition in overseas markets is equally fierce.
Not only traditional brands, emerging brands, and cross-border players from China have their own advantages, but also many overseas forces have begun to compete for the "cake".
In January last year, Harley's CEO announced that the entire brand would move towards electrification. Honda launched a new two wheeled electric brand, "Honda e:", and American car giant Ford also partnered with electric brand N+to launch two new electric bicycles, the Bronco and Mustang. The Bronco is also suitable for off-road riding in rugged terrain.
Given the relatively low technological threshold and limited application scenarios of two wheeled electric vehicles, as well as the serious phenomenon of homogenization, many brands have turned to betting on the high-end market in order to break the deadlock.
In recent years, Yadi has launched the VFLY series of high terminal brands, with prices ranging from 6999 yuan to 19800 yuan. Emma has also launched its high terminal brand, Xiaopa Electric, targeting high-end white-collar workers in cities. The entry-level Vitality Edition is priced at 4999 yuan, while the Prestige Edition is priced at 9999 yuan.
The high pricing of the product aims to attract high-end consumer groups. However, although the high-end market strategy can increase profit margins, it may also increase the burden on enterprises and the market acceptance is questionable.
Taking Xiaoniu Electric as an example, it not only engages in intelligent innovation such as in car large screens and intelligent interactions, but also pursues top-level component matching, using the same Tesla Panasonic battery.
Although it spared no effort in intelligence and component configuration, it failed to effectively convert it into profit. According to the interim report, the net profit of the wildly configured Xiaoniu Electric was -79.7161 million yuan, an increase of more than 17 million yuan in losses compared to the same period last year.
Moreover, intelligent competition is becoming increasingly fierce. Nowadays, app launch, GPS positioning, all-weather vehicle monitoring, OTA system and other configurations have almost become standard for domestic two wheeled electric vehicles. To widen the gap, major manufacturers may need to create more intelligent and high-quality two wheeled electric vehicle products to enhance product competitiveness and thus improve enterprise competitiveness.
In summary, the domestic two wheeled electric vehicle manufacturers that originated from Dongfeng's policies have collectively entered a period of seeking change, actively seeking the sharp edge to break through the situation, and going global has become a key battlefield for industry reshuffle. For industry leaders who have already suffered double blows in performance and valuation, if they can seize the opportunity and achieve a second leap, they may be able to overcome the cold winter and usher in a new spring.
