International Bike Group aims for leading position in e-bike lease market | NPM Capital

Could you explain what this new partnership roughly involves?
“It’s really very simple: we will be supplying electric bicycles to customers of LeasePlan Nederland and will also be managing all services along with the online portal. This means we provide across-the-board support to our customers – from bicycle selection, delivery, insurance and maintenance to roadside assistance and fleet management software. LeasePlan will be gaining its own nationwide retail network overnight, including experience stores and test centres operated by Fietsenwinkel.nl, around 250 bicycle repair centres throughout the country, roadside assistance, a unique online platform offering a selection of more than 20,000 bicycles, and integrated fleet management software for its customers.”

How do you explain the momentum behind this sort of deal right now?
“There are basically two factors. For one, the Ministry of Infrastructure and Water Management urged Dutch businesses in a document known as Fietsbrief 2017 to provide an incentive for their employees to leave their cars at home – thereby reducing traffic congestion over the long term – and cycle to and from work as much as possible instead. The Ministry is leading the way by investing around €100 million in new infrastructure and charging facilities over the next two years, plus there’s the introduction of the new tax-friendly Bike-to-Work scheme. Under this scheme, employers will be able to offer their employees e-bikes based on a leasing contract or a ‘mobility budget,’ which workers can allocate as they see fit. In some cases, this may be combined with the provision of a company lease vehicle. E-bikes can then become a viable alternative to cars or public transport when it comes to commuting to and from work. The ongoing survey we launched this year, the E-bike Commuting Monitor, shows that a growing number of workers have a positive view of e-bikes as a serious commuting alternative to cars and public transport. That’s why I have no qualms in saying that we’re on the eve of an exponential rise in the number of e-bike commuters.”

What makes LeasePlan such a winning partner for your company?
“Well, there’s their sheer scale, just for starters: they are the largest player in the market, so if you want to get anywhere, it only makes sense you would want to explore opportunities with them. There’s also the fact that LeasePlan is a company with a strong commitment to sustainable transport, so getting into the e-bike business on this kind of scale is certainly consistent with that.”

It may be consistent, but it’s also fraught with risk. Drivers of lease vehicles have a reputation for being extremely attached to their cars – hardly the cycling kind. Is this really going to work?
“We believe it will, of course, since otherwise we wouldn’t have signed this deal. For starters, e-bikes are extremely popular: more than 400,000 were sold in the Netherlands in 2018, a number that is expected to rise to around 550,000 next year. Two out of every three bicycles sold at Fietsenwinkel.nl are currently electric. But we also believe that integrated mobility packages, including e-bikes, are an appealing option for many commuters. If you lease an e-bike for professional use, for example, you don’t have the downside of a relatively high purchase price and maintenance costs. You can use it for both business and personal purposes and don’t need to keep a record of kilometres driven. Our E-bike Commuting Monitor shows that people are very willing to take the e-bike to work, particularly for shorter commuting distances.”

“In all fairness, I don’t think it’s a case of whether e-bikes will become a serious mode of transport for travel to and from work, but rather when people will start using them at a level where they fully replace cars, buses or trains several days a week or even altogether.”

How many additional e-bikes does IBG expect to be able to sell on the back of this partnership deal?
“We estimate that our new full-service leasing solution – which we will be marketing under the ‘Hellorider’ label – will give us control of around 20% of the market for e-bike leasing for professional use; this is the equivalent of around 30,000 additional bikes.”

Finally: earlier on, you mentioned the Fietsbrief policy document and the new tax-friendly bike scheme. Do you feel the Dutch government are doing enough? In the Climate Agreement, for example, e-bikes barely get a look-in.
“That’s a good point. If it were up to me, there would be a lot more research into the effective reduction in carbon emissions created by e-bike commuters, and how this impacts congestion problems in the Netherlands. This would be a boon to the climate debate and make it clear to everyone that commuting by e-bike is low-hanging fruit that no one, neither the government, nor employees, nor consumers, can avoid. That’s why we plan to continue with the E-bike Commuting Monitor: there’s a real need for hard data to back up the policies for the next few years. And while the new tax-friendly Bike-to-Work scheme is a commendable first step, the percentage of 7% is still nearly double the rate that currently applies to fully electric cars. In Belgium, the rate is as low as 0%, and we’re already seeing the effects over there: there’s no other country where e-bike commuting is so popular. I’m also curious to see how much money the government will actually allocate during the next term for investments in supporting bicycle infrastructures such as bike lanes and charging facilities.”

Also read: ‘Fietsenwinkel.nl taps into growing popularity of e-bikes’