How Japan’s Terra Motors wants to plug developing nations into e-bikes

This article is republished with permission from The Bridge, which covers Japan’s startup scene in English and Japanese.

One of Terra Motors’ cheaper e-bike models on sale in Nepal.

Japan-based electric motorbike startup Terra Motors has been a pretty busy company over the past year, with branches opened in Vietnam, the Philippines, and India. In addition to those, the company is partnering with dealers all around the world, just last week announcing a big partnership to sell its e-bikes in Nepal. Admittedly Nepal isn’t the biggest of markets. But when I visited Terra’s office earlier this week, overseas sales director Koshi Kuwahara told me why it is an ideal market for an electric vehicle company. He explained:

There are several aspects to deciding whether or not to enter a market, whether or not to set up the company or a factory. Yes, there is a big market in China. Yes, there is a big market in Indonesia. But we have to consider the competition, how eager partners are, and we also have to consider the government. In the country’s where we have our own branches, local governments are very eager about electric vehicles. In Nepal, the reason they are so interested in EVs, is because Nepal has the highest petrol price in Asia.

From a Western point of view, the decision to go electric is often made with consideration to the environment. But Kuwahara showed me a list of countries, along with corresponding fuel prices and GDP per capita, noting that in places where gas prices are relatively high and GDP relatively low, it really has nothing to do with saving the earth.

It’s all about saving money.

A huge gap in import duties for conventional versus electric bikes means that Terra Motors can sell for about $100 cheaper than their gas-guzzling competition. For example, Terra’s A4000i e-scooter sells for a mere Php 8,030 (US$180) in the Philippines. And the startup is very optimistic about prospects in Nepal, where gas and diesel prices have spiked in recent years [1]. The press conference for their opening in Kathmandu attracted about 150 people from most major media, a reflection of that optimism and enthusiasm.

Kathmandu is a small city spanning about 15 kilometers edge to edge, says Kuwahara, so a Terra Motors e-bike, which can get about 45 kilometers from a full charge, is more than adequate for getting around. And the city’s notorious air pollution, which is among the worst of all the world’s cities, means that they will be very much welcome by the local government.

The startup is aiming to sell about 1,000 bikes in the next year, and has already sold 500 from this new dealership. While most of the market conditions are great for Nepal, it is still a pretty tiny market with about 200,000 motorcycles sold per year. But at this early stage for Terra Motors, it’s a perfect place to expand without overextending.

Currently the company’s headcount sits at 27, but they are hiring staff for local offices.

The Japan advantage

Perhaps the most interesting aspect about Terra Motors, in my view, is how greatly it benefits just from being a Japanese company. Kuwahara explains that they are not the first company to push electric bikes in the markets where they operate, but coming from Japan carries credibility that serves the brand well. Many competitors quickly developed a bad reputation due to poor battery performance or some other quality issue. He adds:

Beyond Asia