08. 29. 2016 News

9 out of 10 E-Bike Startups Fail According to Expert

In a wire report yesterday, Germany’s leading press service, the dpa, looks at the e-bike industry and reports on the fact that most newcomers entering the market regularly fail.

This is one of the realities of the e-bike boom that has, up to now, received little attention in the media.

More than 200 E-bike brands are vying for the consumers’ euros in Germany. At this year’s Eurobike, the leading industry trade fair, you will find these players out in full force – many enjoying heavy investment and yet an especially large number of them set to fail.


E-bikes account for around a 15 percent share of the market in Germany. This growing development resulted in a total sales volume of 2.42 billion euros for bikes and E-bikes in Germany in 2015 – an increase of 12 percent.


With such market conditions, it is hardly surprising that more and more companies and manufacturers are entering the arena. But success in the cluttered e-bike jungle does not come easily for any company. George S. Pascal, Executive Director of ITMS, an agency that has helped to shape the European E-bike boom for more than ten years, and one who is still active in the market today, believes that the majority of said entrants will not be successful. “Most go on to disappear from the scene or linger ineffectively in the market before bowing out. This also applies to big names in the automotive industry and those from less related fields. Nine out of ten newcomers will fail on the E-bike market”, says the industry veteran.


The reasons for failure are as varied as the products offered and services associated with E-bikes. “Frequently products are simply thrown prematurely into the market, and there might be quality defects that at the price range at which E-bikes are marketed, especially in Germany, are simply not acceptable”. Pascal goes on to disclose one of the biggest complaints from consumers and mer-chants: “In addition, companies tend to lack basic infrastructure requirements, such as a market-driven service offering.” Of these newcomers, the whole spectrum from the upscale through to lower priced models are vulnerable. “Some strategic errors include basic orientation, the way a provider wants to position itself in the market and which sales and communication channels they choose,” explains the market expert. “It is usually of no matter whether it is an established bicycle company with market knowledge, or an outsider. These kinds of failures can be observed on both sides.”


In the dpa piece, Pascal goes on to admonish the failure of many brands to adopt a strategic approach: “More diversity across the range is desired but new entrants have to form a clear and competitive positioning in a very short time in order to generate a relevant market penetration”.