Eliminating PST on E-bikes
The return of the PST also brought the return of a tax exemption BC cyclists had long enjoyed. New bikes and parts are once again tax free in this province. Sadly, the tax-free status isn't extended to the growing e-bike segment. And with e-bikes occupying the upper end of the price range, it's possible the tax could impact sales. A full-featured ebike such as the Sport XS750 by Canadian maker Ohm Cycles costs over $4000. That works out to roughly $300 in PST added to the cost. It is time to lobby the government to include e-bikes under the PST exempt status.
E-Bikes providing retailers with 26% of their revenue
Although the e-bike industry is still in it's infant state in Canada, in the Netherlands the e-bike sales has been surging for over a year. I just met with a good friend of mine last friday who is with the bike theft division of the Dutch police. She said her workload has increased tremendously and is now also working with e-bike manufacturers on theft prevention, particular with chip technology. The Netherlands has also reported that e-bikes has increased the range for commuters travel by 4 to 5 times the distance from an average of 15k to 60km a trip.
It's safe to say that e-Bikes are a genuine trend in the Netherlands. In the past few years electric bicycles have become so popular that even car brands are using them nowadays as incentives to sell their 4-wheelers. In the Netherlands e-Bikes now count for 26% of all the money dealers make from selling new bicycles.
"With e-Bikes a market opened up that is not to be looked upon in terms of volume as with regular bikes; it's about revenue and profit." This quote is from a spokesperson from GfK Retail Tracking – the company whose retail panel is able to pinpoint exactly how many e-Bikes were sold in Holland last year through various distribution channels.
That number stood at 124,250. The majority, about 80%, were sold through dealers at an average sales price of € 1,945 ($2700 CAD). No other distribution channel in The Netherlands is able to sell e-Bikes at such prices. Dutch department stores like V&D or Hema sell electric bikes for prices just below € 1,000 ($1400 CAD) DIY stores, meanwhile, can only sell them for about half that amount (€ 528 = &735 CAD).
Of the total of 124,250 e-Bikes sold last year in Holland, 97,800 were sold through dealers, where they accounted for 17% of total turnover. But despite freezing temperatures during the first two months of 2009, during which the sale of regular bicycles dropped with 21% compared with the same period in 2008, sale of e-Bikes climbed further.
The harsh winter couldn't stop the growing demand: in the first two months of 2009 e-Bikes accounted for 26% of turnover at dealers. "Looking at all this it is remarkable that about 20% of all dealers in Holland are still not selling electric bicycles. They miss out on about € 135,000 in turnover which is on average what a dealer is per year now making with e-Bikes," "Price is not an issue for consumers shopping for an e-Bike," continues GfK Retail Tracking in Tweewieler. "Looking at the prices for e-Bikes at Sparta, Batavus, Gazelle, Giant and Koga, dealers tend to include cheap private labels in their range. However, they should consider the fact that consumers don't shop for low prices at dealers. Instead they look for advice, service and quality."