Electric two-wheeler rental firms charge up for gig delivery boom

The opportunity lies in the country’s more than 3 million delivery gig workers, who power last-mile services across quick commerce, food delivery and parcel logistics, as well as newer offerings such as on-demand domestic help.

Yet electric two-wheelers remain a small part of this market: Only about 120,000 delivery workers, according to industry estimates, currently use rented electric bikes, with another 80,000 owning their vehicles. Together, that represents just 3-4 per cent of the total workforce. A substantial proportion of the low-speed models, which have a maximum speed of 25 km/h, are imported from China.

The market could expand rapidly. Redseer estimates that the number of delivery gig workers will reach 5.5 million to 7 million by 2030, while industry estimates put the figure as high as 10 million. Anubhav Sharma, Baaz cofounder and chief executive officer (CEO), expects 3 million to 4 million gig workers to be using electric two-wheelers by then.

The economics are a powerful part of the pitch. For delivery workers, renting an electric vehicle can cost considerably less than running a petrol-powered scooter, while avoiding the burden of buying and maintaining a vehicle.

“It’s actually a no-brainer. Gig workers make more money by renting an electric two-wheeler than by paying for petrol for an internal combustion engine vehicle,” says Amit Gupta, cofounder and CEO of Yulu Bikes, one of whose major investors is Bajaj Auto.

Yulu has raised $93 million from venture capital investors to support the plan to expand its fleet 10-fold by the end of 2030. The company has so far focused on low-speed electric bikes, which do not require a driving licence or registration. It is now entering the higher-powered segment, which requires a licence, to cater to bike taxis and e-commerce workers carrying heavier loads.

Amit Gupta says Yulu plans to increase its presence from 12 cities to 75 by 2030. It also intends to expand its charging infrastructure, built through a joint venture, from about 400 stations to more than 1,000 over the next few years. Bajaj Auto, which manufactures Yulu’s vehicles, is preparing to double its production capacity to meet the additional demand.

For gig workers, the savings can be substantial. Akash Gupta, cofounder and CEO of Zypp Electric, which has raised $76.5 million across several funding rounds, says delivery workers typically earn ₹1,000-1,500 a day and pay ₹200-250 for a day’s rental.

Running a petrol-powered scooter, by contrast, can cost more than ₹450 a day in fuel alone, based on an average daily distance of 80-100 km. That is before accounting for vehicle loan instalments and maintenance.

Zypp’s proposition goes beyond the rental price. “We have an ecosystem in place to ensure that the rider gets high uptime on the bike, which is key to his earnings,” says Akash Gupta.

The company operates battery-swapping stations across cities, allowing riders to avoid charging their vehicles at home. It also runs service hubs staffed by trained mechanics who can resolve vehicle problems within an hour. Maintenance costs are borne by Zypp, rather than the rider.

The company is now stepping up its expansion. Zypp, Akash Gupta says, plans to add 100,000 electric two-wheelers over the next 24 months, taking its fleet to 132,000. It has also introduced a franchise model to reach smaller cities. Under the arrangement, local entrepreneurs use Zypp’s technology platform and electric vehicles to run operations in their markets.

“We expect the franchise model to add another 20,000 electric bikes across these cities over the next 24 months, including places such as Dhankot and Rohtak,” he says.

Baaz is taking a different route from its rivals: It assembles its own electric two-wheelers in Haryana. Operating currently in the Delhi-NCR region, the company plans to increase its fleet from 6,000 bikes to 200,000 over the next three to four years, while entering additional cities.

“We will require around ₹2,000 crore to achieve our target, which we plan to raise through a combination of debt and equity,” says Sharma.

The case for manufacturing in-house, he argues, lies in the demands of commercial use. “Building a commercial electric two-wheeler is not the same as building a consumer electric scooter. We had to design the product to withstand heavy use. It needs to run 100 km a day, compared with 15-25 km for a consumer scooter.”

That difference shapes the vehicle’s design — Baaz uses metal rather than plastic for the body, while its storage compartment is concealed to prevent packages from being stolen. The company has also designed the vehicle to improve its internal rate of return on each unit compared with competing models, he adds.