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Flywheel: The Impacts of Ebike Rebates | Vehicles from Lectric, Specialized, Gazelle, EBC, & Ride1Up

Exploring how to maximize the effectiveness of ebike rebates & featuring the top 5 vehicles of the week


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

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The observation of the week explores how to maximize the effectiveness of ebike rebates and examines their potential impacts. This week’s featured vehicles are a recently launched remarkably affordable premium commuter, a recently launched longtail cargo bike, two cruisers, and a scrambler-cruiser hybrid.

Observation of the Week

Maximizing the effectiveness of ebike rebates and understanding their impacts

Inspired by the success of Denver’s ebike rebate program that launched in 2022, we’re currently seeing a growing number of cities around the country that are offering ebike subsidy programs. 123+ cities are in the mix in the US, and there’s even a long-awaited federal rebate being reviewed by Congress.

While each mile covered by an ebike instead of a car is obviously cleaner, more accessible, safer, and healthier, it’s important to understand that there’s a distinction between the positive impacts of ebikes and the potential impacts of ebike rebates. A deeper examination of this distinction helps us understand the best way of framing and structuring ebike rebates to maximize their effectiveness.

David Zipper recently wrote an excellent article that summarizes a study on this notion published last month in Transportation Research Part D: Transport and the Environment. Titled Consumer purchase response to e-bike incentives: Results from a nationwide stated preference study, the study surveyed residents across 20 cities who were interested in buying a bike and found the following key findings:

  • “Point-of-purchase discounts are the most influential at shifting behavior, followed by tax credits, then mail-in rebates”

Across the 100+ programs out there, the ways in which people can receive subsidies varies significantly. The study found that point-of-purchase subsidies are by far the most effective: “Point-of-purchase discounts are 30% more effective than mail-in rebates.” Particularly for lower income residents, the upfront cost of purchasing an ebike is a significant barrier. Many buyers also don’t necessarily even have a tax liability large enough to receive the full rebate.

  • Rebates are potentially too generous

The study found that the optimal rebate level that leads to a new ebike purchase is dependent on the city’s population and budget, and ranges between $200-$800. This is much lower than the max rebates available in most cities with active subsidy programs. Given that many cities are running out of vouchers extremely quickly, lowering the subsidy value can increase a program’s reach to more people.

More specifically, the study also found that the optimal rebate level that leads to the purchase of a cargo bike isn’t much higher than that of a regular ebike. The authors suspect that this is likely due to currently lower interest in cargo bikes given their novelty and higher retail prices. In my opinion, since cargo bikes are typically bought by parents looking for ways to transport their children, the added safety considerations when riding with a child in the rear also play a huge role in this apprehension. Even if you are only hauling cargo, there’s understandable worry that the extra weight makes the vehicle more challenging to ride.

At the moment, most cities offer several $100s more in subsidies for cargo bikes vs. regular bikes, and the study recommends lowering that delta. While I agree that there’s room to reduce the subsidies for this form factor, I don’t think they should be lowered as much as the study may suggest. Many people don’t switch to ebikes because they worry that they won’t be able to haul their kids or carry other payloads, and cargo bikes solve this concern. Although there may be a lower willingness to buy cargo bikes now, I think keeping (albeit slightly less) elevated subsidies for cargo bikes can help propel the exposure and adoption of cargo bikes.

  • “Income-based schemes that are often aimed at increasing equity result in cost-effectiveness trade-offs”

The study found that incentives were impactful among those with “incomes between 200% and 300% of the federal poverty level.” This range zeroes in on individuals that have a high enough income to be able to afford the upfront cost of an ebike and are willing to take a chance on buying a new vehicle form factor, but are still sensitive to the costs of driving a car. The study also found that subsidies have a much lower influence on higher-income individuals, and that these individuals are making the purchase decision based moreso on their pre-existing interest.

  • “Policy makers should evaluate the investment in e-bike purchase incentives across benefits from added e-bike ownership that include not only greenhouse gas reductions, but also health benefits, increased mobility, travel affordability, safety, and congestion reductions.”

Finally, the study found that “across point-of-purchase scenarios, the average inframarginal cost of an added e-bike purchase is $4252 (range $3719 to $4799).“ In other words, it takes ~$4,252 in ebike rebates to generate one additional ebike purchase. This stat leads to their most surprising conclusion: ebike rebates aren’t the most effective spend of public money to reduce emissions.

Zipper provides a great explanation of the math behind this conclusion in his newsletter:

“To understand why, start with the study’s finding that around $4,000 in rebates must be distributed to induce one new e-bike purchase. Then consider that the average American car generates a ton of carbon emissions, valued at $51 by the federal government, for every 2,500 car miles driven. $4,000 in rebates divided by $51 yields 78 tons of carbon that a single e-bike would need to offset in order to justify the rebates – meaning that the e-bike would need to replace roughly 200,000 car miles driven. It is effectively impossible for an e-bike to be used anywhere near that much.”

A sole measure of the emissions reductions per dollar spent on ebike rebates paints a potentially grim picture. However, the study says that this may actually be ok because reducing GHG emissions isn’t necessarily the only goal/benefit of a subsidy program. The authors point out that there’s potentially even greater and more important benefits around “health, increased mobility, travel affordability, safety, and congestion reductions.”

That being said, I actually don’t think this measure of the inframarginal cost means that it’s time to give up on ebike rebates as an efficient way to reduce emissions. Even if ebike rebates aren’t the most cost-effective tool for reducing emissions today, I believe that they lead to adoption and behavioral changes that actually make them more cost-effective tools for decarbonization in the future. Each new ebike bought because of a rebate may not replace 200K car miles on its own, but it does feed into the ebike adoption flywheel (pun intended). As more ebikes hit the streets, more people are exposed to ebikes. More people become comfortable riding because there is safety in numbers. This then leads to greater demand and more advocacy for improved bike infrastructure, which leads to even more people being comfortable with riding an ebike in urban settings. We’re just at the beginning of this flywheel, and rebates/subsidy programs are an important fuel to catalyze it. As ebike adoption grows, I strongly believe that the “inframarginal cost of an added e-bike purchase” referenced above will drop significantly.

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Launched last week, the Lectric ONE is a class-2/class-3 premium commuter with an unbelievably affordable price tag. Its powertrain features an 85Nm rear hub motor and a 500Wh battery pack, which is UL 2849 compliant. What’s truly remarkable about the ONE is that Lectric somehow managed to squeeze in a $3K+ drivetrain into a vehicle that retails for $2,219. The drivetrain consists of the auto-shifting, weather-sealed 6-speed Pinion C1.6i gearbox (typically found on $10K+ ebikes) and a Gates Carbon belt drive (typically found on $4K+ ebikes). This combination is particularly potent and solves the belt-drive vs. throttle trade-off that many ebike OEMs have had to make. Belt-drives are smooth and low-maintenance components synonymous with premium ebikes, but they aren’t compatible with derailleurs. This means that belt-drive ebikes either need to be single-speed or use a mid-drive motor with an internally geared hub transmission. However, mid-drive motors don’t work well with a throttle. Lectric solved this challenge by using a Pinion transmission that sits at the pedals, which allows it to have a belt drive, a throttle, and a cheaper and easier to maintain hub motor. There is no torque sensor on the ONE, but Lectric’s PWR (Pedal Assist Wattage Regulation) controls software that limits assistance by power vs. just speed alone gives the ONE a smoother pedal assistance than most other ebikes with cadence sensors. Additionally, the ONE’s cadence sensor is also much better than the average cadence sensor found on ebikes. As Lectric’s CEO Levi Conlow explains, “while most cadence sensors have 12 magnets, ours has 96 of them, so we’ve got 8x the resolution and much snappier feedback.” Topped off with hydraulic brakes, the ONE is an ultra-reliable and maintenance-free vehicle package that is perfect as your daily commuter. I’d like to reiterate that it’s simply unbelievable how inexpensive the ONE is. Despite featuring components that are normally found on $10K+ ebikes, the ONE costs less than most mid-market commuters. It’s a testament to the incredible supply chain control that Lectric has achieved, as well as the “extreme purchasing power” that they now have as America’s biggest ebike OEM. The ONE is available for purchase online and will begin shipping in May. Listing can be found here.

MSRP: €6,500 | Flywheel Price Comparison: $0 less than avg resale price | Flywheel Vehicle Value: €6,500

The Specialized Turbo Porto is a longtail cargo bike released just earlier this month. Following last year’s launch of the Globe Haul line, the Turbo Porto is the (significantly) more expensive and premium big sister geared towards Europe and Canada. Its powertrain features a 90Nm (250W) custom Specialized 2.2 Cargo mid-drive motor that is manufactured by premium German motor supplier Brose, as well as a 710Wh battery pack. As per EU standards, the Porto’s pedal assistance cuts off at 25km/h. Rounding out the drive features are an enviolo continously variable planetary hub transmission with a Gates Carbon CDX belt drive and hydraulic disc brakes. The Porto is nimble and stable even when it’s fully loaded to its 200kg max payload capacity. In addition to the excellent powertrain and drivetrain mentioned above, the smaller rear tire (20”X2.8”) than front tire (24”X2.8”) configuration improves the vehicle balance by keeping the center of gravity of rear cargo down. Like the Globe Haul line, the Turbo Porto is one of the few Specialized ebikes that comes standard with several must-have urban accessories. Out of the box, the Turbo Porto comes with built-in rear and front racks, a suite of anti-theft features (integrated wheel lock, Turbo System lock, and motion sensor alarm), a Garmin Radar that notifies you of cars that are passing by, a rear view mirror, a double leg kickstand, integrated lighting, and fenders. The Garmin Radar and rear view mirror are particularly notable, and are huge safety and peace of mind features given that these types of bikes are often used by parents to transport their kids on the back. The rear rack is also conveniently compatible with the MIK HD quick-connect interface to mount an endless number of cargo hauling accessories to the back of your Turbo Porto. Although the Turbo Porto is undoubtedly one of the more expensive longtail cargo bikes on the market, its components and performance specs help it outcompete most of its peers that are only marginally less expensive. The Turbo Porto is currently only sold in Europe and Canada, and I sincerely hope it’s made available in the US in the near future. Listing can be found here.

The Arroyo C8 HMB Elite is a premium class-1 cruiser from the 130+ years old Dutch brand Gazelle. Reputed for crafting some of the finest quality ebikes on the market, Gazelle is a highly prestigious brand that was even honored with the coveted “Koninklijk” title by the Royal Dutch family in 1992. The Arroyo C8 HMB Elite is the latest in their popular cruiser lineup. What sets the Arroyo C8 Elite apart is its extra-stiff frame, which solves the frame flex issues that most step-thru ebikes suffer from and gives the Arroyo responsive and sporty handling. As the HMB (Hybrid Mid Bosch) descriptor in its name suggests, the Arroyo C8 Elite’s powertrain features a 50Nm Bosch Active Line Plus mid-drive motor and a frame-integrated 500Wh Bosch Intube battery pack. This is paired with a low-maintenance 7-speed Shimano Nexus hub and hydraulic brakes to give the Arroyo C8 smooth pedaling and excellent acceleration/deceleration. Finally, a suspension seat post, puncture-resistant tires, and an integrated rear wheel lock round out the vehicle. The Arroyo C8 Elite is an expensive cruiser, but its quality and the ability to have it serviced at virtually every bike shop help justify its price tag. This listing was bought in April 2023 and has a mileage of 1624mi. Proof of purchase is available upon meeting in person, and the vehicle is even registered on Bike Index and 529 Garage. This is a great (and free) way for sellers to build trust with potential buyers and assure them that the listing is not a stolen vehicle, and it’s one that not enough sellers take advantage of. Listing can be found here.

MSRP: $1,499 | Flywheel Price Comparison: $233 more than avg resale price | Flywheel Vehicle Value: $1,516

The Electric Bike Company (EBC) Model J is a class-2/class-3 hybrid that merges a scrambler form factor with cruiser-style finishings. EBC builds all their vehicles in the US, which means that their ebikes are highly customizable. Buyers have the option to personalize nearly every component on their bike, from paint colors and battery sizes to throttle types (twist vs. thumb), suspension options, handlebar styles, pedal assistance sensor types (cadence vs. torque), and theft-prevention options. Check out EBC’s neat online customization studio to see the full range of configuration possibilities. The advantage of domestic assembly goes beyond customization and extends to delivery as well; all EBC bikes are shipped fully assembled, which ensures that customers receive ebikes that are safely put together and ready for riding right out of the box. The Model J’s powertrain features a custom 85Nm EBC rear hub motor and a 672Wh battery. Lastly, all Model Js come standard with hydraulic disc brakes and 24" by 3" fat tires to make them comfortable and agile for urban riding. This listing has a mileage of 40mi and comes with ~$800 worth of upgrades (dual batteries, an anti-theft alarm, and a front suspension fork). Listing can be found here.

MSRP: $1,595 | Flywheel Price Comparison: $77 more than avg resale price | Flywheel Vehicle Value: $1,195

The Ride1Up Cafe Cruiser is a a high-quality yet affordable class-2/class-3 cruiser that combines the classic features of a cruiser bike, such as a plush wide seat, swept-back handlebars, and a step-through frame, with the agility and utility of a commuter bike. Its powertrain features a reliable 60Nm Bafang rear geared hub motor and a 720Wh battery pack. The Cafe Cruiser has a front suspension fork, hydraulic disc brakes, and cruiser-specific 3” wide tires to ensure a smooth ride with excellent handling. Another standout feature of the Cafe Cruiser is its integrated rear rack with a 150lb payload capacity, which can be fitted with Ride1Up’s $125 Passenger Kit (quick-release rear seat, wheel covers, and foot pegs) to comfortably accommodate a child or small adult on the back. This is a function rarely found on cruisers, and is a great example of how Ride1Up continues to innovate on the classic cruiser form factor with practical urban-focused features. This listing has a mileage of 397.2mi and comes with an extra battery, a passenger kit, and a suspension seat post. 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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