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China tech

Chinese e-bike startup zips into space created by new regulations

Star Drive sees latecomer status as advantage in huge potential market

Star Drive, which develops e-bikes equipped with smart batteries and other cutting-edge features, aims to establish an entire ecosystem -- from sales to charging and servicing. (Photo courtesy of Star Drive)

BEIJING -- Star Drive, a Chinese electric bicycle startup founded in 2016, is poised to grab market share from leading brands under new safety technology standards imposed by Beijing this year.

The company recently unveiled a new product -- called the Jike. King -- which took two years and several million dollars to develop. The bike is scheduled to go on sale at the end of June in a Chinese market where 250 million electric bicycles are already owned.

Old models that do not meet the new standards, which took effect in April, will be driven out within several years -- creating an opportunity for Star Drive. Charging stations for the new e-bike have already been set up in the provinces of Jiangsu and Zhejiang, the city of Shanghai and part of Anhui Province. Self-service battery replacement stations are also undergoing trials ahead of a formal launch in July.

Under China's traffic regulations, anyone aged 16 or older can ride an electric bike. Data from the National Bureau of Statistics shows there were 980 million people between the ages of 16 and 65 in China at the end of last year, meaning there is a huge potential customer base for e-bikes.

Under the new national standards, e-bikes must have pedals, travel at a maximum speed of 25 kph or less and sound alarms when they reach 15 kph. They must weigh no more than 55 kg, including the battery, and the rated output of the motor must be no more than 400 watts. Battery voltage is restricted to up to 48 volts.

E-bikes are also required to meet tamper resistance, flame retardancy and other standards.

China's leading e-bike brands such as Yadea and Aima were all established around 2000. But late market entrants like Star Drive now have a chance to grab market share by developing products that conform to the new rules.

Star Drive develops e-bikes equipped with smart batteries and application platforms using big data. The company is aiming to establish a service ecosystem covering everything from rentals and purchases to charging and battery replacements.

Star Drive founder and CEO Yu Lin, the original shareholder of the Aima brand, has more than 10 years of experience in the industry. He brings a track record of helping to make Sunra and Aima the top brands in terms of sales volume.

Referring to the new national standards, Yu said, "Standards for things such as speed, weight and size have become clear."

"As functions that can be mounted are limited, a lithium-ion battery will inevitably become standard equipment and elements such as appearance, feeling of use, 'smartization' and the introduction of IoT (internet of things) will become differentiating points of individual products," Yu said.

Regarding demand for battery replacement services, Yu noted that e-bikes are used 700 million times per day in China. Assuming each one is charged every three days, battery replacement service demand per day would exceed 200 million times, he estimated.

To prevent fires, the Ministry of Emergency Management strictly bans charging batteries indoors, be it privately or for profit. Yu thinks that rules like this will also become a tailwind for Star Drive's business.

The Jike. King was designed by a team of staff involved in automobile development. The new e-bike's development process was fully digital, with product analysis conducted using computer-aided engineering, or CAE, simulation software.

The new bike is equipped with a smart centralized control device developed by Star Drive.

Yu suggested that as 5G mobile technology spreads and IoT is applied to just about everything, e-bikes will become smart tools that play increasingly central roles in their users' lives.

36Kr, a Chinese tech news portal founded in Beijing in 2010, has more than 150 million readers worldwide. Nikkei announced a partnership with 36Kr on May 22, 2019.

For the Japanese version of this story, click here.

For the Chinese version, click here.

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