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Welcome to Flywheel, a weekly exploration of the used side of owned micromobility. Each newsletter will highlight five of the most interesting used vehicles being sold in the market followed by an observation of trends emerging in the industry.

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This week’s features are three commuters, a stealthy electric road bike, and a cross country trekking bike. The observation of the week explores the healthy margins of selling used ebikes.

Top 5 Vehicles of the Week

1. BirdBike | $1,250 | LA

The BirdBike is a class-2 commuter sold by Bird, the shared micromobility company that introduced dockless shared scooters to the US. The design feels like a bit of a copycat of the iconic VanMoof frame geometry, but there’s a number of feature differences that make the BirdBike a compelling commuter in its own right. The powertrain consists of a heavy duty 500W (~80Nm) Bafang hub motor and 460Wh removable battery pack, and the transmission uses the smooth and maintenance-free Gates carbon belt drive. This listing is fresh out of the box and has 0 miles of usage. There are rumors that Bird is closing down their retail division, so this could be a rare opportunity to get your hands on a BirdBike. As an aside, I personally think Bird shutting down it’s retail division is the wrong call. I’ve always maintained that shared services were instrumental in exposing the public to micromobility, but the biggest opportunities in micromobility lie in owned. In my opinion, most shared operators would be wise to scale down their shared services and use them as a customer acquisition/marketing channel and maintenance infrastructure for selling vehicles. Listing can be found here.

2. Cannondale Quick Neo SL 1 | $1,900 | NYC

The Cannondale Quick Neo SL 1 is a sporty class-1 commuter and road bike hybrid. At first glance, the Quick Neo SL 1 doesn’t even look like an ebike. That is largely due to its downtube integrated 250Wh battery pack and stealth 40Nm hub motor all packaged in light and small aluminum alloy frame components. Although the motor and battery pack may seem modest, the Quick Neo SL 1 weighs a shockingly light 34lbs so the powertrain is more than capable of providing reasonable pedal assist, even with a child on the rear rack. This listing is only a year old and is in like-new condition (Flywheel estimates <200 miles of usage). The most notable aspect about this listing is that it was bought at REI, an outdoor recreation equipment retailer. All ebikes bought at REI come with “Coast to Coast Support,” meaning that they can be serviced at any of the 170+ REI stores nationwide. REI has quietly become a giant in the owned micromobility space. It’s one of the largest distributors of many well reputed ebike brands (i.e. Cannondale, Electra, Benno, Haibike, Diamondback), has a massive maintenance network (every retail store has a bike shop), and even sells its own line of ebikes branded Co-Op Cycles. Listing can be found here.

3. Rad Power RadCity | $800 | Seattle

The Rad Power RadCity is an affordable class-2 urban commuter. Despite being one of the cheapest name-brand ebikes available in the market, the RadCity is amongst the best commuters under $2K and one of the most popular ebikes, particularly with first time buyers. In fact, the RadCity is actually the most commonly sold ebike model on Craigslist across major US markets. The RadCity’s powertrain features a direct drive 90Nm motor and 672Wh battery. The direct drive motor is a notable feature of the RadCity because it is much more reliable than the standard geared hub motors Rad Power normally uses and is capable of regenerative braking. This listing is actually for a stolen ebike that was recovered by the original owner, and it’s an interesting case-study of the tactics bike thieves may use to disguise the fact that the bike they are selling is a stolen one. From the seller, “the thief spray painted the bike, original color is white. The thief cut the battery tray off leaving partial bolts in the frame. The battery had to be moved slightly higher and has been replaced with an aftermarket battery pack.” Listing can be found here.

4. Giant Explore E+ 2 GTS | $2,900 | NYC

The Giant Explore E+ 2 GTS is a class-1 hybrid cross country trekking ebike. At an MSRP of $3,450, the Explore E+ 2 GTS is one of the most affordable ebikes from a dealer-network brand. It is almost in the same price range as premium D2C ebikes yet comes with access to one of the largest bicycle maintenance networks in the world. The powertrain features a 70Nm mid-drive motor custom-made for Giant by Yamaha and a 500Wh removable Giant battery pack neatly integrated into the downtube. There’s also an excellent front fork suspension, making the Explore E+ 2 GTS a great option for urban commuting. The Explore E+ 2 GTS is the most commonly sold dealer-network ebike model on Craigslist across major US markets. This listing is a demo bike at an NYC bike shop, has only 2.8 miles of usage, and can be registered to the buyer for a full 2 year warranty serviced by Giant. Listing can be found here.

5. Cowboy C4 | $1,400 | NYC

The Cowboy C4 is a class-1 commuter that sits alongside the VanMoof X3/S3 as a leader in the growing genre of software-enabled ebikes. Due to Cowboy’s vertically integrated vehicle platform approach (à la VanMoof), the C4 has a number of advanced software features (theft protection, GPS tracking, crash detection, and an integrated cockpit that riders can dock their smartphones on) that give the ownership experience of a C4 a much more well-rounded, Tesla-esque feel. The powertrain features a 45Nm hub-motor and a 360Wh battery pack. This listing is a display model with negligible usage (<20 miles) and is still under warranty. Used Cowboy C4s typically sell for almost as much as their MSRP if not more, so this listing of a brand new C4 selling for ~$1.1K less than its Flywheel Vehicle Value is a steal. Listing can be found here.

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Observation of the Week

The healthy margins of selling used ebikes

The National Bicycle Dealers Association recently released its 2022 Cost of Doing Business Survey, an analysis of the financials of bike retailers across the US in 2021. In this report, there were two key graphs I wanted to highlight:

Despite the fact that used bikes have the highest gross margin for a bike retailer, revenue from used bikes today is almost negligible for most retailers. The fact that used bikes have such great margins isn’t too surprising, and is in track with the automotive industry where used cars have higher margins than new cars. I think that used bikes contributing a low portion of revenues is due to the fact that volumes of ebikes in the used market is still fairly low. Ebikes are more expensive and more likely to be resold than pedal bikes, but we’re still in the early stages of high volumes of new ebike sales and thereby in the early stages of those new ebikes transitioning into the secondary market. However, as sales of new ebikes continue to grow, the secondary market for ebikes will expand and used bike sales for retailers should begin to make up a larger portion of revenue.

When looking at the secondary ebike market today, the vast majority of ebikes are being resold well before they’re even close to their end of useful life. On Craigslist in 2021 across major US markets, vehicles are being listed with an average usage of 361.68 miles, nowhere near the mileage that these vehicles are typically rated for. Many existing used ebike retailers I’ve spoken to also say that people tend to severely underestimate the usage required to noticeably degrade battery or motor performance, so the refurbishment costs are actually fairly low because you usually don’t have to replace the battery or motor. For retailers that can systematically and intelligently identify these lightly-used vehicles, there’s an interesting opportunity to buy them, refurbish them for cheap (mainly just replacing wear and tear components like brake pads or tires), and resell them at very healthy margins.

Thanks to Worth Smith for referring me to the NBDA report.

That’s it for this week. Thanks again for joining, see you next week!

- Puneeth Meruva

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