We recently took a look at various firms offering e-bike subscription and the concept of buying ‘e-bikes as a service’ - i.e. paying a regular subscription fee for a bundle of services that not only include use of the e-bike but other things like on-demand repair or replacement in the event of a fault or insurance. Here we take a look at the pros and cons of subscribing to an e-bike compared to buying one outright.
- Pros of e-bike subscription
- Cons of e-bike subscription
- Pros of buying an e-bike
- Cons of buying an e-bike
- Which option represents better value
- The future
Replacements, insurance and other peace of mind services
Subscription services vary in terms of what they offer, but the kinds of things you might expect to benefit from include a replacement bike in the event of just about any kind of damage from Swapfiets and attractive sounding insurance from Dash, covering theft and damage. Just what these extras are needs careful comparison from provider to provider. To give just one example, locks and helmet may or may not be included in the price.
Lower up-front cost
Most subscription services operate on the basis of a fixed weekly or monthly fee. Of the four main subscription operators currently in the UK, this varies from a very attractive £30 a month or so Dash (though note this is an employer-employee tax incentive scheme and the £30 represents the employee contribution only), to around £160 for Zoomo’s delivery worker optimised e-bikes. However this is not a direct comparison, as Zoomo’s offer can be cancelled at short notice and the bikes are meant for ‘business use’ - i.e. day in and day out food delivery in all weathers, whereas other companies may specifically exclude business use.
You should pretty much always have access to a working e-bike
It’s usually the case that if the bike breaks down you get a replacement, though specified times within within which one will be supplied may vary from company to company. This should mean you won't have to wait many weeks for a spare part - a scenario that could arise if you purchase an e-bike and need it repairing. Furthermore, in the worst case scenario, with much older e-bikes, no spare may be available to get it repaired at all. It may also be the case that all of your local bike shops refuse to repair an e-bike not bought there.
Flexibility and 'try before you buy'
For a whole host of reasons, you may only need or want an e-bike for a limited time. You may want to try out the e-bike experience (or want to try out a particular design) before taking the plunge and buying. You may be on a short-term work contract. You may want to use an e-bike only over the summer months, or you may want to change between different types of e-bike or even to a different provider. Subscription allows all of this. Again, offers on rental periods vary – Dash offer contracts of 1, 3, 6, 12 or 18 months, whilst Zoomo rentals are weekly – so shop around to see if there is a period to suit you.
Generally speaking, the longer the rental period, the cheaper the cost. Be aware there may be extras charged on top of the rental fee itself, Dash charge a £14.99 delivery charge and Zoomo a starter fee of £50 to register with them, plus a refundable deposit of £100.
This is really an area for an accountant's advice, but there are several means of deducting the cost of an e-bike, whether renting or buying. For example, using an e-bike for self-employed work purposes might mean a subscription makes more sense, especially for workers on short-term contracts as they won’t necessarily be writing the cost off over several years – it should class as a tax-deductible expense. By contrast, the Dash service is aimed directly at participating employers and employees (see below).
Undoubtedly a major drawback for subscription services is the fact that only a very small range of e-bikes is on offer in the UK currently, compared to hundreds if not thousands of different e-bike models available for sale.
For the firms involved - especially those offering repair and/or replacement services like Swapfiets and Zoomo - it’s really only practical to offer their services in big cities. In Swapfiets’ case, London, and for Zoomom London and Manchester. This is clearly another big limiting factor.
Market in its infancy
With time the e-bike subscription market may well grow to offer a greater range of services. (For example, the option to change between e-bikes, e-scooters, e-mopeds and other light electric vehicles, should legal change allow such vehicles on public roads.) It may also expand geographically and with any significant expansion a price drop may well come about too.
You have to give the bike back….
Ultimately, the subscription period will end and you will have to give the e-bike back. It’s not that bad though, given there is likely to be a similar model available for purchase.
Often good second-hand resale value
E-bikes are generally a good investment, especially if you are able to invest in a better quality model. For example, both Shimano and Bosch guarantee their batteries by the number of charge cycles – 500 for Bosch and 1,000 for Shimano. In practice this is a conservative estimate and such high quality batteries are likely to last for several years if looked after properly, contributing to a healthy resale value.
Conversely, budget e-bikes are more likely to depreciate in value over time and so are relatively less competitive when measured against e-bike subscription.
Modify and customise
With your own e-bike, you can add a pannier rack if it doesn’t already have one, change to tyres more suited to your purpose, adjust the height of the handlebars for a more comfortable riding position or put puncture resistant ‘slime’ in the inner tubes. In short, you can modify and customise as you want. (Just so long as you don’t attempt to change the performance of the electric assist which will void the warranty and perhaps even make the e-bike illegal to use on public roads.) Some subscription services may allow a handful of changes or additions to the bike, but even if they do, they're likely to be limited in scope.
Tax rebate schemes such as Cyclescheme are available on e-bikes, depending on your exact employment status and your employer’s willingness to take part. These allow you to spread the cost of buying an e-bike and also provide a significant saving.
Some brands offer service subscriptions
Another possible subscription service involves buying a bike outright but having the option of subscribing to an ‘on-demand’ maintenance and fault-fixing service. Hi-tech urban brands Cowboy and Van Moof have offerings that cover any work required as a result of regular use of the bike, including any part that needs replacing (paid for by them). Cowboy Care costs £20 a month, while Van Moof Peace of Mind is priced three-yearly with insurance options thrown in as well. Three-year maintenance is £278, three-year theft cover is £328 and three-year theft and maintenance combined is £550.
An obvious point, but good quality e-bikes are pricey things. Subscription schemes from the likes of Dash and Swapfiets do offer you the chance to ride, say, a Shimano mid-drive or a Brompton Electric (from £2,995 were you to buy outright) at a fraction of the cost of buying one.
You can’t return the bike if you've made a bad choice
For all the test riding and research you do before a purchase, there is always the possibility you wished you’d made a different decision. Maybe the battery just isn’t quite big enough for your needs or perhaps you've realised you'd have been better off with something offering a bit more off-road comfort. With a subscription bike it’s easy (and maybe also cheaper) to try something else… and if that doesn’t suit, you can try something else again.
Subscription may look more attractive if you use credit
If you are going to be using the monthly payments option for a purchase, bear in mind that’s going to cost. The extra money that credit costs you might potentially have allowed you to get a better spec e-bike on subscription.
Lets take a hypothetical example based on a mid-value e-bike actually for sale at the time of writing: a Bosch Performance Line CX mid-drive e-MTB hard tail – 1 year old – 2,000 miles – available on eBay for £2,000.
Let’s assume four more years of use of the e-bike before you decide to sell it on for £300, so £1,700 divided by 48 months is around £35 per month.
Whilst this compares pretty favourably with most of the subscription services detailed here the case is less clear once you have added on a few typical extras that subscription services are likely to offer. For example, let’s assume you average £120 a year for spares and labour on replacement parts etc and opt for, say, Cycleguard anti-theft insurance with roadside recovery included at £15 per month (a quote we obtained on the above e-bike). You are now looking at £60 per month, which is a price where some current subscription services will start to look competitive.
That's just one example, however, illustrating some of the things you may wish to weigh up. Look at a different bike and you may draw different conclusions. The depreciation on a brand new e-bike is likely to be greater than on a second-hand one of similar spec, for example. Similarly, buying a new but very cheap e-bike may look like good value against a subscription, but this may well prove a false economy if you end up with more repairs to pay for and if it has negligible resale value.
A few worked examples using prices on e-bikes you are looking at and factoring in extra services you are likely to want or need will give you a better idea which option might suit you better.
As the above section suggests, any perceived extra cost attached to the subscription option may be just that. Arguably, a much bigger barrier to the take-up of subscription services in the UK is simple lack of choice - both geographically and in terms of the models on offer. In essence, relatively small, specialist subscription companies are operating in very geographically limited areas.
Subscription e-bikes may well come to the fore in the future, leading to a greater geographical spread and a wider range of e-bikes. Organisations like the AA or the RAC, with their national reach and recovery fleets also seem ideally placed to extend services from cars to e-bikes. Indeed, there is a ready template in the form of Germany’s ADAC (Allgemeiner Deutscher Automobil-Club or the ‘General German Automobile Club) – Europe’s largest motoring organisation.
ADAC launched an e-bike subscription service in May 2020 and the rate at which they have expanded it suggests it has been a great hit amongst the organisation's 20m-plus members. They now offer e-bike subscription in five broad groups; e-MTB hardtail, e-MTB full suspension, trekking, city and kids, with monthly prices from €89 and all packages including repairs, insurance and a lock, with 6- and 12-month contracts available.