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<b>Netherlands 2007:</b> Market Takes Full Advantage of E-Bikes

Sales & Trends

AMSTERDAM, the Netherlands – 2007 was a breakthrough year for e-Bikes in the Netherlands. Their market share jumped from 3% to a little over 6% in units sold; this means a growth from 40,000 to 84,000 units. In terms of turnover the effects are even bigger. e-Bikes now already account for nearly 20%. Is the […]

<b>Netherlands 2007:</b> Market Takes Full Advantage of E-Bikes

AMSTERDAM, the Netherlands – 2007 was a breakthrough year for e-Bikes in the Netherlands. Their market share jumped from 3% to a little over 6% in units sold; this means a growth from 40,000 to 84,000 units. In terms of turnover the effects are even bigger. e-Bikes now already account for nearly 20%. Is the industry able to maintain this growth and will other European markets follow suit? 

Number of new bikes sold in the Netherlands (x 1.000 units)

2000
2001
2002
2003
2004
2005
2006
2007
1,517
1,365
1,324
1,219
1,250
1,239
1,323
1,400

According to the Dutch industry organization RAI Association this growth has not yet come to an end. For next year the electric bike segment is expected to expand to 120,000 units. A trend which will be continued in the years to come as target groups for e-Bikes will grow with the rising need for new means of comfortable and individual transportation. The RAI Association regards the electric assisted bicycle as a driving force for the industry for the years to come.

Up and Down

Nice spring weather gave bike sales a boost in the Netherlands last year. Unfortunately the summer and autumn saw very bad weather lead to a dramatic drop in sales. The influence of the weather on bike sales remains tremendous, even in a market where the bicycle is used for transportation on a large scale and not only for sports and recreation.

The annual survey of 11,000 households sponsored by the Dutch bike branch and industry organizations BOVAG (for dealers) and RAI Association made clear that bike sales had grown from 1,323,000 units in 2006 to 1,400,000 in 2007. According to the RAI Association approximately 1.1 million bikes were produced in the Netherlands last year, while 300,000 were imported.

The largest part of last years’ market growth is the direct result of the rising popularity of e-Bikes, let alone the weather conditions. The in this report mentioned e-Bikes are of course pedelecs, or the version of electric bikes that come with a 250 Watt (hub or crank motor) that provides pedaling assistance up to 25 km/h.

The average sales price of e-Bikes is much higher than in most other segments. Most electric bicycles at IBD shops are sold for € 1,800 on the average. The overall average consumer price of bikes went up last year by 3.5% to € 603. The overall average consumer price at the IBD shops grew even more: by 4.4% to € 709. Some 60% of all bicycles sold have a consumer price of less than € 700; 40% have a price tag above € 700.

If we exclude the e-Bike from this calculation the average price of bicycles would be only € 529 instead of € 603. These figures clearly indicate that the bike industry needs the electric bicycles to maintain growth.

MTB down

Not all segments booked positive results in 2007. The number of MTBs sold in the Netherlands has been surpassed by e-Bikes. This makes the MTB more and more a sports only segment on a par with road racing bikes. Not unexpectedly the market share of city bikes remained more or less the same at around 60%. The hybrid bike suffered the most from the growing popularity of the electric bicycle, as its market share went down from 15% to 10%. Apparently the support of the e-Bike is an important added value for this category of buyers. If the market meets its expectation for 2008, more electric bikes than hybrid bikes will be sold this year.

The market share of the IBD in the Netherland, although still very large, is slowly decreasing. Just ten years ago it was still extremely high with a market share of 90%. In the past few years this figure has gone down gradually, to 74% last year. Although the relative market share is still substantial, IBDs were not able to profit from rising sales of bikes last year.

In 2007 the number of bikes sold via IBDs grew only by 0.4% to 1,036,000 units compared with 2006. Alternative channels, such as supermarkets and do-it-yourself stores, recorded 20% sales growth from 291,060 units in 2006 to 364,000 bikes in 2007. Although not officially stated in the figures, it is said such retailers have sold a lot more e-Bikes.

A large group of customers still appreciates the professional advice of the IBD. It is not clear how much influence internet sales have on this declining market share. This is the result of the active participation of a group of IBDs with internet sales. A relatively small group of bicycle dealers has opened their own web shop in addition to their bricks-and-mortar outlet. At the moment 6%, or some 84,000 units, is sold via internet. This is just a small rise compared with last year when 66,000 of all bicycle in the Netherlands were sold via web shops.

Fight against theft

The number of kilometers the Dutch ride on their bicycles appeals to the worlds imagination. That also counts for the number of bicycles stolen every year. Out of 18 million bikes in the Netherlands, an estimated 700,000 are stolen annually.

In the fight against bicycle theft, the Dutch Secretary of State for Home Affairs, Guusje Ter Horst, officially opened an on-line Bike Theft Register last January. 4.5 million bikes have been registered in this system. This public data base (see www.fietsdiefstalregister.nl) can be checked for tracing and tracking of stolen bikes and when buying a second hand bike. The Dutch Police are equipped with scanners that are linked to the online database.

Not surprisingly, Dutch cycling advocacy has a strong focus on e-Bikes. The BOVAG and RAI Associations have asked the Finance Department to include the e-Bike in the existing tax facilities in order to stimulate the use of e-Bikes for commuter traffic. In addition both organizations are trying to reduce the VAT for new bicycles, accessories, sheltering and maintenance from 19 to 6%.

Sales Down at Dealers

In Holland two surveys are being conducted on the sale of bicycles and bike products. Next to the annual survey of 11,000 households sponsored by BOVAG and RAI Association, which results are published in this article; there’s also one being done at dealer level. Every two months GfK Marketing Services is conducting a survey sponsored by several individual companies under about 800 dealers.

That 2007 survey indicated that Dutch dealers not only lost a share of the market last year but were also confronted with receding sales. In 2007 they have sold 2% less compared with 2006 while other retailers saw their sales grow by a huge 10%. The data confirm the cut in the average price of bikes sold if the e-Bikes are left out. Especially the high end segment above € 1,000 would be depressed.

Unfortunately it is not the IBDs who are taking full advantage of booming e-Bike sales: also alternative retailers are doing good business in this segment.

New bike sales in price ranges/market share (in %)

Euro
2000
2001
2002
2003
2004
2005
2006
2007
0 – 300
27%
28%
22%
34%
32%
31%
30%
31%
301 – 499
17%
18%
21%
18%
15%
20%
20%
17%
500 – 699
27%
18%
21%
16%
16%
13%
19%
13%
700 – 899
14%
23%
20%
22%
26%
25%
20%
25%
> 900
5%
9%
8%
10%
12%
11%
11%
14%
Unknown
10%
4%
7%
 
 
 
 
 

New bike sales by category (in %)

 
2002
2003
2004
2005
2006
2007
Dutch City bike
56%
57%
52%
54%
59%
60%
Hybrid bike
16%
15%
18%
17%
15%
10%
MTB
6%
6%
6%
5%
4%
3%
Juvenile bike
18%
17%
17%
17%
15%
17%
Electric bike
 
 
2%
2%
3%
6%
Rest
4%
5%
5%
4%
4%
4%

Where bikes are bought

 
1999
2004
2005
2006
2007
IBD’s
85%
78%
77%
78%
74%
Alternative sellers
13%
22%
23%
22%
26%
Internet
 
 
3%
5%
6%

Source: BOVAG, RAI

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