Gogoro recently announced its results for 2021. Curiously enough, what exactly did the company do to revive its dwindling electric bike sales last year, to the point where sales in certain regions resulted in a 30% market share?
Annual sales of motorcycles in Taiwan for 2021 underwent a 200,000 YoY drop, although this figure only reached 6,000 units for electric bikes. As a result, the penetration rate of electric bikes once again broke through the 10% mark and reached 11.6%. More shockingly, PGBN sales continued to skyrocket in 4Q21. According to the latest data from Gogoro, with respect to sales of motorcycles in Taipei in December 2021, nearly a third of all motorcycles sold were electric bikes.
What exactly did Gogoro do to break through the stagnation of year 2020 and grow against market headwinds?
Perhaps the key to this whole thing is to be found not in Gogoro, but in government policies. Without a doubt, as news of Taipei’s increased electric bike subsidy appeared, the market reacted with instantaneous zeal, in turn driving up PBGN sales by almost 100% YoY. However, the overall data show a meaningful trend.
“Electric bikes require subsidies to survive” is a concept that everyone understands in Taiwan, but how does one explain the fact that sales plummeted after the government canned subsidies for ICE vehicles? On the whole, motorcycle sales dropped by 200,000 YoY in 2021, although electric bikes underwent only a 9,000 unit decrease YoY. Certainly the impact from the COVID-19 pandemic was palpable, but without subsidies, ICE vehicles suffered no less damage than did EVs.
▲Taiwan’s motorcycle sales in 2020 skyrocketed owing to the government’s phase seven fuel economy standards.
On the other hand, Gogoro accomplished three tasks across 2020-2021 in order to welcome this aforementioned rebound in the first paragraph? First of all, the company massively expanded the volume of service provided by technicians, in turn addressing logistical shortages that began plaguing the company since 2019. Secondly, with respect to the intense dislike most customers harbor towards timing chain maintenance, Gogoro released Viva Max along with a series of vehicles featuring timing belts instead in order to precisely satisfy consumer desires.
The third thing has to do with Gogoro’s raison d'être, which is to provide an efficient means of replenishing energy. Looking back at the nadir of 2020, the major issue of the day was an inability to locate fully charged batteries. Gogoro responded in the most brutally simple way by building as many charging stations as possible.
Gogoro added 63 Super GoStations, 235 GoStations, and 26,000 swappable batteries in 2021. Given this strategy of explosive growth, the average distance between GoStations is between 300 m at the closest and 350 m at the farthest, thereby reducing the anxiety derived from battery swaps.
At the same time, Gogoro continued to massively ramp up Super GoStations in order to increase the efficiency of battery swaps. Generally speaking, the 6 pm rush hour had seen plenty of riders unable to receive fully charged batteries, but this number went down drastically last year compared to years past. At peak demand hours, about 5% of riders now are unable to get fully charged batteries, a figure that was more than twice as high in 2020.
▲ Riders failing to receive fully charged batteries are indicated in red.
Taiwan currently has 2,215 GoStation sites and 93,428 swappable batteries, enough for a comprehensive network across the six special municipalities. In 2022, in addition to building Super GoStations, Gogoro has also started expanding its battery swap network to rural areas. The total number of GoStations are expected to surpass that of gas stations by the end of the year in Taiwan.
Even so, one core problem still confronts Gogoro: how to raise the energy density of batteries so that riders with long commute needs do not have to swap batteries as much? Incidentally, this is also the holy grail highly sought after by various battery and EV manufacturers the world over.
(Image: Gogoro)