Kiwi electric bike maker strikes US alliance, targets $50m revenue

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Bay of Plenty company Ubco – creator of the world’s first electric farm bike – has struck a deal it hopes will help it crack the North American market.

Ubco chief executive Timothy Allan says he’s been working closely with two US technology entrepreneurs, Bob and Ethan Ralston, to determine the best approach to achieving direct US investment and creating a successful US market launch. This has resulted in the formation of a distribution company UBCO US LLC, based in Eugene, Oregon.

Father and son entrepreneurs Bob and Ethan Ralston founded, developed and successfully exited IoT (internet-of-things) company Feeney Wireless to Novotel Wireless in 2015 in what was reported as a $US50 million deal (half in cash, half in earn-outs).

Along with Spring Capital, the Ralstons have invested $US1million in Ubco, taking total funding to $NZ3.95 million.

Ubco unveiled a demonstration electric motorbike at Fieldays in 2014, and released its first commercial model, the 2x2 (pictured) in early 2016.

Mr Allan says his company has so far sold about 150 bikes across New Zealand and Australia, where Daviesway has signed on as its distributor.

The range is 88km to (under full power) 107km on flat land but Ubco usually tells farmers to expect a range of 60km to 80km.

The 2x2 is a luggable 58kg, and its 12-volt electric battery can be used to recharge electric farm tools (and there are also two USB ports, so you can plug in your iPhone, too). It won’t set any speed records (top-speed is 45kph) but it does have equivalent torque to mid-size petrol equivalent (see full tech-specs here). GPS is built in.

So far, he’s one year into a five-year plan to get to 10,000 bike sales a year or about $50 million revenue after retailers have taken their slice (the 2x2 retails for $6999).

Manufacturing is done with help from Chinese electric bike maker Yadea, which could easily scale production; it already makes more than three million light vehicles a year (Mr Allan says he doesn’t fear for his company’s intellectual property; he says there are “robust contracts,”  which are translated into both English and Mandarin, and that Ubco controls vital second-tier components including the batteries).

Ubco plans to release its first type-rated bike (that is, one that can be registered to ride on public roads) as early as next month. The new model will also be more powerful; in tests it's managed a load of up to 285kg including the rider, which Mr Allan says will position it for use for commercial applications such as use by postal services.

It will also have a more powerful battery, the better to recharge more power-thirsty farm gear. It’s also likely that the new battery will also be sold separately, creating Ubco’s second major line of business.

A side-by-side or UTV bike is in the works but not a quad bike. Mr Allan says safety issues have precluded the development of an ATV.

A solution in search of a problem?
My main memory of my brief motorcycle ownership was that my bike cost nothing to run and never required any major maintenance.

Why go electric?

Mr Allan says “silence.” The 2x2 makes no noise (see video). It literally won’t scare the horses. And no drive chain or gears – and few moving parts overall – means there’s not much to break down.

At $6999 (or $US5999 for American buyers), the 2x2 is competitively priced for mid-size farm bike.

The Ubco boss says there’s an addressable market of about 550,000 for unregistered bikes (those used on farms or for recreation or otherwise not on public roads). He also sees conservation and tourism as industries where it could appeal.

There are other players in the electric bike market, from established motorcycle players like Ducati to electric specialists like Zero.

But Mr Allan says his company has the lead in farm bikes, and none of the major or minor players will be able to match its model coming in 2018.

He says the Ubco 2x2 will first appear in the US in a dealership that sells BMW and Ducati bikes. When people look at a $US25,000 Ducati, then a $US5999 2x2, the Kiwi option will look pretty appealing.

The Victoria University industrial design grad says potential trade buyers have already been sniffing around.

But he says for now Ubco would rather remain independent to give it full control over its platform.

If the time does come to sell up, he says it might not be to the likes of Honda or another motorcycle maker. He says a battery company or even an Internet-of-Things player could prove to be the successful buyer.