With an eye on the rising demand for handicapped electric scooters worldwide, the Industrial Development Bureau (IDB) of Taiwan's Ministry of Economic Affairs (MOEA) hopes to spur the island's development into a global center for electric scooter R&D, logistics, and production.

To that end the IDB will offer incentives for development, including subsidies for R&D spending, tax holidays and exemptions, and investment-tax credits. The agency hopes that this will help Taiwan become a major producer of such scooters, and of key parts for related electronic and control systems.

The IDB recently set a production goal of about 900,000 handicapped electric scooters with a value of NT$30 billion (US$900 million at NT$33.3:US$1) in 2008, up from approximately 400,000 units worth NT$17 billion (US$510 million) now. By 2008, according to the IDB, handicapped models will account for around 60% of the island's overall electric-vehicle production, putting Taiwan on a par with South Korea as a top supplier of these products.

Ed Benjamin, president of the CycleElectric International Consulting Group, noted that American production of electric-scooter products focuses on the recreational and handicapped market, and that such vehicles are not expected to replace gasoline-powered cars as a primary means of transportation anytime soon.

Benjamin nevertheless expects increasing demand for electric scooters and bikes over the next four or five years, at least in the United States market, thanks to rising gasoline prices and the growing aged population.

IDB officials say that Taiwan has a well-established infrastructure for the development of electric-scooter products, with a number of companies (powered two-wheeler manufacturers as well as specialized electric-scooter makers) entering the line and achieving good results over the past few years. These include Kwang Yang Motor Co., Pihsiang Machinery Manufacturing Co., Merits Health Products Co., Chien Ti Enterprise Co., and Comfort Orthopedic Co.

Among the island's makers of handicapped scooters, Pihsiang predicts record shipments of more than 100,000 units this year. Kwang Yang, Taiwan's No. 1 producer of powered two-wheelers, is working on American and French medical certification for its handicapped models; the company expects to export about 135,000 electric scooters this year, and predicts that the figure will grow several times in the coming few years.

IDB officials report that Taiwan as a whole produced about 300,000 handicapped electric scooters worth NT$15 billion (US$450 million) last year, around 80% of which were for export.

Moving Away to Cut Costs

Some manufacturers in the line are planning to cut their costs by moving production to mainland China, the IDB sources say. They hope, however, that the domestic companies maintain control of key technologies for motors, controllers, batteries, chargers, and other items.

Hsu Yu-chen, chairman of the Taiwan Electric Scooter Industry Development Association (TESIDA), notes two advantages that Taiwan enjoys in developing his industry: a flourishing electronics industry, which can offer high-quality, reasonably priced electronic controllers, and a well-established central-satellite plant system and parts-supply chain that has arisen in tandem with the brisk development of the powered two-wheeler industry, which supports not only parts supply but also product innovation.

The core factor in the successful development of the electric-scooter industry relies is the key battery technologies, comments Pan Jin-pin, director of the Materials Research Laboratories (MRL) of the Industrial Technology Research Institute (ITRI). Years of strenuous work have resulted in the local development of lithium-ion batteries, he says, and this could well be Taiwan's "secret weapon" in promoting exports of its electric scooters.

Michael Hsu, a specialist with the first division of the IDB, remarks that Taiwan's failure in its attempt to develop electric scooters as transportation vehicles several years ago was caused by an ill-conceived attempt to replace gasoline-powered scooters with electric ones. In most areas of performance, he notes, electric scooters are still much inferior to their gasoline-powered counterparts, including cost, power output, and range.

However, Hsu stresses, that disappointment had the positive effect of prompting local electric scooter makers to shift their focus to handicapped and recreational models. The change has achieved a certain measure of success.

Timing is also an important factor in the development of handicapped electric scooters in Taiwan, Hsu adds. The aging of the global population is creating a huge market for such products; and Taiwan, with its competitiveness in terms of quality and price, is well positioned to fill much of the rising demand.