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Bringing electric motorbikes to Southeast Asia’s masses

Jakarta’s smog grows thicker by the year. Sputtering motorbikes clog the city’s congested streets in rising numbers, spewing toxic fumes as they weave in and out of traffic.

Indonesia has about 115 million motorbikes – or almost half its human population. These two-wheelers are affordable and easy to drive, making it the leading mode of transportation in many countries.

From left: COO and co-founder Joel Chang, CEO and co-founder James Chan / Photo credit: Ion Mobility

James Chan and Joel Chang, co-founders of Singapore-based Ion Mobility, are eyeing a big opportunity. If they can bring affordable electric motorbikes to the masses, they won’t just make a ton of money – they can cut down air pollution, improve the health of city dwellers, and mitigate climate change.

They’re not the first e-motorbike maker out there, but they’re in the running to create the first mainstream one.

It’s a grandiose goal, but Chan wants nothing less. After stints as a government servant, startup investor, and tech executive, he’s aiming for the moon. “I want my three young kids to know that their father is doing something that can make an impact on the world,” he says.

Chang was the co-founder of Scorpio Electric, an e-motorbike outfit also based in the city-state that targets premium customers. He later realized that his beliefs changed – instead of pushing for exclusivity, he thought creating an affordable product should be the way to go.

The entrepreneurs met and found that they had the same vision. In October 2019, they took the first step of registering their company.

No petrol needed

Ion Mobility remains an embryo. It’s refining its prototype – which works and packs a punch – in a sparse industrial estate. The startup has lined up a dealer in Indonesia to gear up for a commercial launch in the second half of this year.

While the founders toyed with the idea of enticing business users first, they ended up in the consumer market. Businesses hesitate to adopt something without consumers doing it first, Chang reasons.

Their first product – dubbed Model 1 – won’t appeal to everyone. Instead, they’re wooing Indonesia’s middle-class millennials, a sizeable and growing group that’s more conscious about climate change compared to older generations.

Still, cost savings will be a draw. Compared to the gas-guzzling equivalent, Chan expects their motorbike’s power consumption to cost six to seven times less for every kilometer of travel. This benefit partly stems from how an electric motor doesn’t consume any power when idle, whereas a gasoline engine would keep running.

And because their e-motorbike – which can be charged from a wall socket – lacks fuel components like a spark plug and doesn’t need engine oil, maintenance will cost two or three times less, Chan claims.

Photo credit: Ion Mobility

The Model 1 is hooked up to the internet. Sensors on the vehicle would collect data about its performance and inform the owner when it’s time to send it in for maintenance. A well-tuned bike, in turn, would consume less energy. Driving behavior data could also help improve future designs.

A full charge, which takes three hours, allows two days of commuting to and from the workplace. This means that the bike is not suitable for heavy-duty usage – turning it into an ojek Indonesia’s motorcycle taxis – isn’t ideal. But that’s not a segment that Ion Mobility is targeting – for now.

They’ll listen to feedback for Model 1 before deciding what the next product should be, Chang says.

Not a ride-hailer

Ion Mobility is breaking away from how traditional motorbike makers earn income. “We’re not interested in one-off revenues,” he adds, keeping the details under wraps for the time being.

“We’re not running a ride-hailing platform,” Chan hints. He notes that incumbents are aligning and sharing margins with financiers, distributors, dealers, and aftersales networks, making it a formidable ecosystem to go up against.

And unlike Gogoro, an e-scooter startup from Taiwan (full list of industry players here), Ion Mobility doesn’t believe in the battery-swapping model, which lets users replace empty power packs with fresh ones either at home or at a petrol kiosk.

Yes, this approach lets users get to 100% power in a jiffy as opposed to waiting three hours. But the cost and effort of maintaining a battery-swapping network, let alone designing and committing to a power pack and the swapping interface, isn’t worth it.

“Swapping has not been able to scale,” Chang observes.

Photo credit: Ion Mobility

On the other hand, relying on the ubiquitous wall socket allows Ion Mobility to stay lean. The company is finalizing its pre-series A funding round and has only relied on money from its founders so far.

While launching a hardware product is expensive, Chan says that the team has reduced the upfront capital needed to go to market through its expertise, experiences, and supply chain relationships.

“Without raising a series A, we’ll be able to launch the bike, which I think is unheard of in this region,” he adds.

Fending off copycats

With the long list of e-motorbike players and how two-wheelers are less complex than four-wheelers, the market may become overcrowded fast.

Chan disagrees. “I don’t think any successful product is easy to copy. If I extend the same logic, one could assert that mobile phones are easier to copy than laptops, which is not necessarily true,” he adds.

Designing a motorbike also has more constraints when compared to a car due to the lower surface and volume.

Photo credit: Ion Mobility

And besides, even if Ion Mobility’s design is copied, it can build a moat out of the operational complexity of running supply chain, revenue, and distribution models that makes sense. A solid brand is hard to replicate too.

These factors explain why Tesla has kept the lead despite an onslaught of competition from incumbent car-makers.

Preventing deaths

The hope is that clean private transportation can lower the world’s carbon footprint. In vehicles that run on fossil fuels, the engine serves as a power generator, converting fuel into electricity. For electric vehicles, power generation starts and ends at the power plant – making the process more efficient due to the economies of scale, Chang says.

Indeed, studies have shown that in their entire life cycle, electric vehicles often emit less greenhouse gases compared to gasoline or diesel counterparts.

However, if electric vehicles get their power supply from “dirty” sources like coal, they could add to pollution instead of curbing it.

So while electric vehicles are a key part of the equation, their environmental impact will only be maximized when they’re plugged into a clean power grid.

Photo credit: Artem Beliaikin

And yet, if mass adoption of electric bikes leads to less smog on the street level, that counts as a win – vehicle exhausts have been linked to a whole host of health problems. Air pollution causes 7 million premature deaths each year, the World Health Organization estimates.

“We’re not going to be able to change the world overnight,” Chan says. “Even Elon Musk had to go through a bunch of iterations.”