Pic: New S2 DelMar from Livewire. Stylin.
Life in a startup niche market ain’t easy.
You have massive investment costs, R&D costs, a lack of scale, investors to pay and by its very nature, an immature market that is typically small and finnicky.
The premium electric motorcycle market could arguably be considered a niche of a niche of a niche market; premium motorcycles are relatively small market, ev’s are even smaller and premium electric motorcycles are smaller again.
Globally, I think few people would argue that there are really only three players in this market. You can see a wider review of most of bikes available here. Industry pioneers Zero Motorcycles from Santa Cruz USA, who were founded in 2006, Modena Italy based Energica founded in 2014 and Harley Davidson and their spin off company Livewire who launched their first electric bike in 2019.
Now let me say for the record, I am not an investment advisor, this is not investment advice, and you should get professional advice before making investment decisions.
However, I do like to try to understand what’s happening in my favourite niche market as a proud electric motorcycle owner. I’ve already invested in three bikes and am always watching for my next upgrade and in a space like this, picking a brand that has a good probability of survival means I can (hopefully) get ongoing support and not lose too much money on my investment.
The tricky bit is that accurate, publicly available information is extremely limited on these companies and ownership (or more accurately investment and fund raising) changes on a regular basis.
Zero motorcycles is a private company so very little information is public, with the exception of the ongoing fund raises they conduct.
However, we can get an idea from various stories published over the years and previously, some publicly available information about registrations in the US. By most accounts, Zero sells around 2000-3000 vehicles per year (lets call it 2500) and recently claimed they had sold more than 20,000 bikes since they launched. Given their much longer history, wide range of models and some good entry level bikes targeted well to the incentivised Californian market, it sounds about right.
Revenue estimates vary wildly from around US$20 million to US$98 million per annum with this (rather flaky) looking web site suggesting $60M in 2022.
It's not clear whether they are profitable, but it is clear they continue to take on continued investment, suggesting they continue to need funding injections to survive.
As a previous owner of two Zeros (a 2010 DS and a 2014DS) performance was pretty good albeit in a simpler package. Reliability was not so great, but they’ve come a long way.
Energica previously issued public financials but after a huge investment by Ideanomics, their revenue and sales figures are now consolidated and obscured with electric tractor manufacturer Soletrac (also owned by Ideanomics).
In their latest reports, Ideanomics said “Combined, Solectrac and Energica sold more than 850 branded electric vehicles” in 2022. If we were extraordinarily generous, we could guess at 90% of those sales being for Energica motorcycles, or 765 for the year.
They aren’t quite at Zero motorcycle scale yet but in fairness their average sale price is arguably much higher with Energica citing $68M for the entire ev division (say, $61M for Energica).
Harley Davidson’s electric motorcycles by contrast do publish public figures, especially since they spun off into a new listed entity called Livewire.
Livewire have reported the sale of 597 Livewires in 2022 and revenue of US$14million dollars. This represents growth of 29% on 2021 in sales and 40% in revenue. Not unexpectedly, they also reported a huge loss.
Whilst this is nerve wracking, its entirely normal for startups in niche markets so I’m not panicking yet. And I do get to feel a little bit special owning one of the 1500 bikes sold worldwide and of around 75 bikes sold in Australia.
Personally, I think their strong brand and soon to be released entry level electric bike (the DelMar) could carry the through to prosperity, but its way to easy to tell. As a Livewire owner, I can also personally attest to the outstanding quality, performance and reliability of their bike.
So, the combined volume of the three biggest electric motorcycle brands is around 3,862 bikes per annum. We know that Livewire are still losing money and Ideanomics also lost money. It’s not clear wither Zero has reached profitability yet but they completed another substantial capital raise in late 2022, implying the continue to need financial assistance.
In its 2021 investor slide deck, Energica estimated the total global market for performance electric motorcycles at just over 28,000 units by 2024 and similarly Harley Davidson forecast almost 16,000 sales itself by 2024 in its presentation deck.
Universally, all three of these companies have had huge investments and believe the market will grow once the right formula can be achieved – but for now, all we have is a ton of upside potential.
By way of comparison, it is worth looking at the rest of the motorcycle industry for a moment.
Although they cover all market segments, by comparison Honda sold around 14.5 million two wheelers in 2022. There's then a massive gap to second placed Hero Motorcycles (4.6 million) and fascinatingly, electric scooter maker Yadea, just behind at 4.5 million units. You can see 22 brands in the graph below.
Somewhat interestingly, electric motorcycle sales (all segments) now feature in the top 3 - and the bottom 3 when ranked against common brands.
I guess it kind of makes sense, but our three favourite electric premium brands sell similar volume to ultra-premium ICE motorcycle brands MV Agusta and Bimota. And I'm okay with that.