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Welcome to Flywheel, a weekly exploration of the used side of owned micromobility. Each newsletter will highlight an observation of trends emerging in the industry and feature five of the most interesting used vehicles being sold in the secondary market.

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The observation of the week explores Denver’s hugely successful ebike subsidy program. This week’s featured vehicles are three commuters, a premium folding ebike, and a budget cargo bike.

Observation of the Week

Government subsidies for ebikes

Given the new E-BIKE Act tax credit introduced in congress two weeks ago, there’s been a lot of talk about ebike subsidies. When thinking about what makes for a good ebike subsidy program, there’s no better case study than Denver, who’s led the charge for local ebike rebates with the launch of their program in 2022 and has been at the forefront of the momentum that’s led to the (re)introduction of the E-BIKE Act.

Micromobility Industries recently released a podcast with Grace Rink, the Chief Climate Officer of Denver and the head of Denver’s ebike subsidy program. It’s an excellent conversation that uncovers what made the Denver program so successful and highlights some of the main factors to consider when launching a new subsidy. This week’s observation unpacks key takeaways from this podcast and how they may apply to other initiatives more broadly.

The Denver ebike rebate was launched in April 2022, and offered Denver residents a $400 rebate on ebike purchases, a $1200 income qualified rebate for lower income households, and a $500 add-on rebate for cargo bikes. The program has been a runaway success. The Climate Office ran out of their first month’s vouchers within 5 days, and each monthly program since has run out within minutes. In 2022, the program allowed 5000 people to buy ebikes with a spend of ~$3M. A Fall 2022 survey of people that used the vouchers showed that rebate users were ebiking an average of 26 miles/week and replacing 3-4 car trips/week, and those with income qualified vouchers were biking significantly farther and more frequently than those with standard vouchers.

The Denver Climate Office receives an equal number of applications for the $400 rebate and the $1200 income-qualified rebate. According to Grace, while the $1200 voucher makes ebikes significantly more affordable, the $400 voucher is moreso an effort to get people that are already interested in ebikes off the fence about buying one. This structure that provides two different options for two different income levels is a smart way to make sure that the program can simultaneously:

1. Move the adoption needle and nudge those that can afford ebikes but need to be convinced to buy one.

2. Provide meaningful financial assistance and dedicate a majority of the budget to those that that need the subsidy the most.

The program has also helped make ebikes more accessible by lowering the average retail price of ebikes in Denver. Since the beginning of the program launch, there has been a $500 decrease in the average price of ebikes purchased with vouchers because the program has drawn a lot of lower cost retailers into the space.

Perhaps the most significant voucher requirement is that ebikes have to be bought from a brick and mortar bike shop within a 5 mile radius of Denver to be eligible for the rebate. D2C brands and bikes bought online were consciously excluded from the voucher because of the difficulty of servicing them. Grace’s office found that Denver bike shops weren’t willing to service bikes they dont sell out of fear of voiding warranties, and believed that consumers having to assemble a new product they’re unfamiliar with is a safety risk. From a consumer protection perspective, they felt that the only retailers that could provide an adequate customer experience were brick and mortar bike shops. In fact, because of this requirement, Grace mentioned that at least one prominent D2C retailer actually ended up opening a physical retail location in Denver. Coincidentally, Rad Power just opened up a store in Denver last year ;) While the requirement that bikes be bought at a physical store is perhaps a bit too strict and could be expanded to D2C online brands that have maintenance partnerships with remote repair services (i.e. Velofix) or local bike shops, it’s clear that the physical presence requirement is a very powerful lever for cities to encourage OEMs to build more service infrastructure and more complete customer experiences.

One of the other reasons the Denver program is so successful is because it’s structured as a rebate voucher vs. a tax credit. Tax credits can only be fully utilized if the buyer is paying at least as much as the credit in taxes, so they skew towards those with higher incomes. Additionally, given that the upfront cost of an ebike is also one of the biggest hurdles to buying an ebike, the Denver voucher that gives you the rebate at the time of purchase is much more equitable than a tax credit/refund that you receive well after purchasing the vehicle. There’s a few other ways governments can distribute subsidies upfront. One method is the Colorado Governor’s recent proposal to give tax credits to the bike shops, which allows them to reduce the retail price of the vehicle to the end consumer. Another method is partnering with subscription services that split up the upfront cost over some subscription term (i.e. Lug + Carrie working with schools to provide subsidized cargo bike subscriptions to families).

In 2021, a nationwide subsidy program called the E-BIKE Act came into play but was ultimately dropped. However, a new and improved version of the E-BIKE Act was just introduced into congress on March 21, 2023. This Act would provide a tax credit of 30% of the retail price of an ebike, up to $1500. Most notably, this new version of the E-BIKE Act would increase both the maximum retail price of eligible ebikes from $4K to $8K and the income limits to match those of electric car credits. Ebikes will also need to have UL 2849 certified powertrains to be eligible, which is a safety requirement made in response to the growing concerns around ebike battery fires in NYC and across the whole country. This Act is built on the back of a growing number of successful city-level and state-level ebike subsidies, and Denver has been the leader of this movement.

While the US recently expanded its electric car credits to include used vehicles, the E-BIKE act doesn’t follow suit to cover used ebikes given how difficult it is to trace an ebike’s ownership. Cars have VINs and registrations, but ebikes don’t even have serial numbers that are centrally tracked across the lifetime of a vehicle. This is yet another reason (in addition to theft prevention, vehicle history, etc.) why the ebike segment needs a better system to track vehicle ownership.

Thanks to Micromobility Industries for putting together such an informative podcast with Grace Rink on Denver’s rebate program. Check out their excellent subsidy tracker, which gives a global and real time view of all the micromobility inventive programs out there.

For more observations and resources on owned and used micromobility, check out rideflywheel.com/resources.

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Top 5 Vehicles of the Week

1. Tenways CGO800S | $1,250 | Santa Barbara

The Tenways CGO800S is a cleek slass-1 commuter that takes after the design aesthetics of VanMoof and Cowboy. Its powertrain features a 35Nm rear hub motor and a 375Wh battery pack, and is rounded out by a torque sensor and a Gates Carbon belt drive to give riders the intuitive smoothness of a mid-drive motor at a fraction of the cost. There’s also a front suspension fork and hydraulic brakes to further improve handling. The CGO800S is geared towards urban riding, as indicated by the turn signals, integrated rear rack and fenders, front and rear lighting, and a few other accessories that are great to have right out of the box for city riders. For people looking for high quality parts and an urban-optimized design at a low cost, the CGO800S is a great everyday commuter. However, the CGO800S’s powertrain is weaker than that of competing ebikes in the ~$2K price range, and is really better suited to people that prefer physical cycling but want an occasional e-assist. This listing is brand new and still in its original packaging, and is being sold by an ebike reviewer that just did a YouTube video on the CGO800S. Listing can be found here.

2. Eunorau MAX-CARGO | $1,300 | SF - Bay Area

The Eunorau MAX-CARGO is a budget class-2 cargo bike and a highly affordable potential car replacement. Its powertrain features a 40Nm direct drive rear hub motor and a 556Wh battery pack (with built in mounts for a a second battery pack), and is capable of hauling up to 440lb in payload. There’s also a 7-speed Shimano transmission and throttle control to help make the vehicle easier to maneuver. The MAX-CARGO’s throttle is one of its biggest selling points, and is a significant advantage over some of the more premium class-1 cargo bikes. Cargo bikes are vehicles designed for utility, and throttles help maximize that utility and make it easier for more riders to maneuver and balance what can be a cumbersome vehicle form factor. Unlike most base-level cargo bike offerings from other brands, the MAX-CARGO comes standard with all the accessories (i.e. a wooden rear rack platform and wooden running boards) required for riders to start using this vehicle to its full utility from the moment they unpack and assemble it. This listing is in good condition (estimated mileage of ~344mi) and comes upgraded with front and rear baskets. Listing can be found here.

3. Tern Vektron S10 | $3,750 | SF - Bay Area

The Tern Vektron S10 is a premium class-1 folding ebike and arguably the highest quality folding ebike in the market. Folding ebikes often feel fragile and finicky around the hinge, but Vektron’s tall hinge with an auto-lock system makes the frame feel much more secure and replicates the handling of a non-folding commuter. Its powertrain features a 65Nm Bosch Performance Line mid-drive motor and a 400Wh Bosch PowerPack, making the Vektron S10 the only folding ebike with a Bosch mid-drive motor available in North America. The Vektron S10’s 20” wheels make it very responsive and agile on tight urban streets, and the Andros stem allows riders to quickly swap between two different seat heights. There’s also an integrated Atlas V rack, which doesn’t quite give the Vektron S10 the same payload capacity as other vehicles in the Tern lineup but is sufficiently strong for a child seat or light cargo. This listing has a mileage of only 83mi and is certified by Bay Area bike shop The New Wheel (TNW). The certification is a part of TNW’s peer-to-peer used ebike program, and indicates that certified vehicles were purchased at TNW, are eligible for the renewal of TNW’s service plans by new owners, and were inspected by their service technicians for common ebike vitals (battery charge cycles, nominal voltage, etc.). Listing can be found here.

4. Pedego City Commuter | $1,650 | Miami

The Pedego City Commuter is a class-2 cruiser/commuter hybrid launched in 2015. Pedego is well reputed for its cruisers, and the City Commuter is an urban take on their tried and true form factor that combines the comforts of a cruiser (wide saddle, swept back handlebars, lower step-over height) with a more aggressive rider positioning to make the vehicle more agile and responsive. Its powertrain features a 45Nm Dapu rear hub motor and a 360Wh battery pack that is housed in the rear rack. This setup makes the vehicle a bit rear heavy and clunkier to maneuver, so most riders mainly rely on the throttle. However, given that the battery pack is quite small, using the throttle quickly eats into the already modest range of ~20mi. This listing is in like new condition (<200mi mileage), was recently tuned up, and comes with an upgraded suspension seat post. While the City Commuter is an older vehicle with a weaker powertrain than its contemporary counterparts, it still has a very high build quality and makes for a fun neighborhood cruiser. Listing can be found here.

5. FUELL Flluid-1E | $3,500 | SF - Bay Area

The FUELL Flluid-1E is a premium class-3 commuter by legendary motorcycle designer Erik Buell’s electric two-wheeler startup. As a vehicle designed by Buell, the Flluid-1E brings motorcycle-esque rideability to an ebike with top of the line componentry. Its powertrain features a custom designed 100Nm Bofeili mid-drive motor and a dual battery pack setup with a total capacity of 1008Wh. The Flluid-1E is the most premium model within the Flluid-1 vehicle series, and features an Enviolo continuously variable transmission as opposed to the Shimano Hub of its sister vehicles. Rounded out by a Gates Carbon belt drive, the drivetrain and the powertrain pair up to provide a stunningly smooth ride. The Flluid-1E even features an impressive array of software features (PIN code “ignition”, GPS, and rear wheel kick-lock) similar to those found on the industry leading software platforms of VanMoof and Cowboy. Only 7 FUELL ebikes have been listed on the secondary market over the last 15 months, so this listing for a Flluid-1E in like-new condition is a rare find. Listing can be found here.

That’s it for this edition. Thanks again for joining, see you next week!

- Puneeth Meruva

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