Taiwan. Motorcycles sales down 6% in April due to lower e-incentives

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Yamaha EC-05

Taiwan Motorcycles Market kept the positive tone in the 2020, despite the reduction of government incentives for e-scooters. After the 27% lost in January, the market is recovering and year to date April sales at 320.000 were down only 6%. Gogoro advanced as third selling brand in absolute.

2020 Motorcycles Market Data & Outlook

The Taiwanese motorcycles market is in a great shape due to the huge development of electric scooter segment despite the new vehicles registrations for the first four months of 2020 are reported down by 6.2%.

Indeed, the market started losing 27.5% in January, as consequence of the reduced incentives available for e-scooter, which pushed the Q4 2019 on the sky.

Looking at the performance by brand, year-to-date April the market leader Kymco struggled losing 21.7%, while SYM gained 6.2% and Yamaha lost 23.1%. However, the main fact was the achievement of the third place by the e-scooter brand Gogoro, thanks to the success of the last model, the e-viva.

E-scooter huge demand pushed 2019 market at the second best ever sales level

Taiwan is not even one of the top production hub for two-wheelers in the World, but in recent years grew up even as domestic market, gaining positions in the global motorcycles chessboard as market as well.

Indeed, following a series of growth, the market achieved the all-time record volume in the 2017, just a little step down the 1 million annual units. However, the introduction of a new scheme for the automotive industry which penalize the traditional combustion engines in favor of alternative fuels, changed the competitive scenario, reducing the market volume in the 2018, when sales have been 848.000.

Meantime, the fast development of electric scooter segment, driven by the astonishing rise of the recent start-up Gogoro, changed the competitive arena and the traditional brands, SYM, Kymco, Yamaha and Suzuki, are facing new consumer demand struggling under the Gogoro attack.

In 2019, according to data released by the Taiwanese Minister of Transportation & Logistic, the market has recovered and the change of subsidies scheme, reported above, has created huge demand for the year-end days, pushing the market at a record Q4 and allowing a good year-on-year +5.6%, with 895.387 sales, including ICE and EVs models, at the second best level ever 

Two Taiwanese brands, Kymco and SYM are among the top global scooter producers exporting all over the World and – of course – they play the rule of leaders in the home-base country.

Aiming to defend the market position while electric scooters grew up, Yamaha have accepted to find an agreement with Gogoro, to commercialize a new line up of scooters, produced in the local Gogoro plant. The first model fruit of this partnership was recently presented and is the Yamaha EC-5, was available for booking since August 1st, with deliveries in September. 

Electric Motorcycles Subsidy Plan

The Environmental Protection Agency ’s (EPA) draft electric vehicle subsidy has been released informing about a change in the subsidies policy for both cars and motorcycles, which a reduction of new vehicles purchase by 6.000 yuan (US$850)

From next year, the subsidy to purchase a new electric fueled motorcycles/scooter will be reduced from 10.000 yuan (US€1.427) to 7.000 yuan (US$1.000) and will be further reduced at 5.000 yuan in the 2021. This plan assumes that the strong incentives provided so far already helped the manufacturers to create scale economy in the production.

Indeed, the incentive provided so far helped the boom of local start-up Gogoro and incentivized the other players develop a their own electric scooter lineup, with this segment already up a significant share of market, the highest in the World.

Taiwanese Market Heritage

Taiwan is the home-base for well-known global motorcycles companies, like Kymco and Sym and is one of the major motorcycles and scooter producer in the World. However, the domestic market is even one of the Top 10 largest worldwide and the motorcycles are a key device for individual mobility.

The development of the market started already in the ’80 of last century, but the key factor for the industry development was the joining of WTO agreement in the 2002, which pushed the industry to improve standards to match requirements of European and American markets and to allow at the local producer to defend their domestic positions against the arriving importers.

Indeed, an almost favorable legislation has limited the distribution of large size motorcycles and so far the market is dominated by local producers, with Yamaha and Suzuki producing in the country.

Interesting to note as the global leader, Honda, is not producing locally limiting their activity to the distribution of large motorcycles. Indeed, Honda had begun local production of small-sized motorcycles in 1961, mainly 125 cc-class models, in the form of a technology licensing agreement with a local company (under a technical collaboration agreement) and continued until 2003, when has closed operations.