September 7, 2023 - (Braunschweig, Amsterdam, Munich) Volkswagen Financial Services (“VW FS”) and Pon Holdings (“Pon”) are intensifying their partnership in company bike leasing. Within this framework, VW FS will acquire a 49 percent stake in the Pon bike leasing subsidiary Bike Mobility Services (BMS). The Memorandum of Understanding (MoU) on this strategic alliance was signed at the IAA Mobility motor show in Munich today. The aim is to jointly expand in the growing bicycle and e-bike leasing business in Europe and the USA.
“Our partnership with Pon is another important step in our development into a broad-based mobility services provider, thereby supporting the strategic goals of the Volkswagen Group,” said Dr. Christian Dahlheim, Chairman of the Board of Management of Volkswagen Financial Services AG, at the IAA. “There is great potential in bike leasing as an additional profit pool, which perfectly complements our current mobility portfolio. We are thus systematically expanding our service offering for commercial customers and supporting our long-term growth in the European fleet business. We are determined to fully exploit the strengths of Europe’s leading automotive captive company and the world’s leading bike company.”
Janus Smalbraak, CEO of Pon Holdings, added: “Together with VW FS, which already has a global footprint and global financial structure in place, I am convinced we hold a unique position to accelerate the international expansion of bicycle leasing together. The company bike fulfills a clear need of employees, employers and governments, which is why we have been able to grow the business so fast in the last five years. The e-bike plays a vital role in future commuting and the lease option provides employees with much broader accessibility made possible by their employers. The outlook for both Europe and USA is very promising. It is exciting to join Volkswagen in its further steps in the bike market and work together on mobility offerings.”
BMS is Europe’s leading bike leasing company and operates in six countries (Germany, the Netherlands, Austria, Belgium, Sweden, and recently the USA). It is currently providing company bikes to over 600,000 employees working in 65,000 companies from large corporations to SMBs. 90 percent of its lease bikes are electric, delivered and serviced through a network of 8,000 bike dealers. The BMS brands are BusinessBike, Lease a Bike and B2Bike. In Germany, VW FS and BMS have already been working together successfully for over three years. BMS is part of Pon.Bike, the world’s leading bike company.
Company bike leasing as a growth market
Germany is a frontrunner in company bike leasing, where it is firmly established as a successful model for promoting employee motivation. It makes bikes, and especially e-bikes, broadly accessible for the whole employee base. Many enterprises of all sizes, from freelancers to large corporations, as well as public authorities and the public sector, now provide their employees with a company bicycle. The company bike, as an alternative means of commuting, helps to reduce congestion and emissions while improving health. Following the significant investments of national governments and municipalities in cycling infrastructure and mobility solutions, bike leasing is evolving strongly in many European markets such as the Netherlands, Belgium, Scandinavia, the UK, and France. The European market potential for company bike leasing is estimated to reach EUR 10 billion in 2028.
“The growth potential in the USA is also significant, with cities and state governments investing heavily in bike infrastructure,” Janus Smalbraak noted. “BMS just opened its first US office in San Francisco and has already signed large corporations for company bike leasing. Our existing presence and retail relationships in the USA can help enhance our partnership and our offer to US employees, companies, and retailers.”
Cycling has experienced worldwide growth for many years. According to the the German Bicycle Industry Association (ZIV), sales of the bicycle industry in Germany were at a record level of around EUR 7.26 billion in 2022. The main drivers of this positive development are e-bikes, which are becoming increasingly popular and accounted for 48 percent of total sales in 2022. In 2023, the association expects more e-bikes to be sold than conventional bicycles without an electric motor for the first time. This growth trend with e-bikes taking the lead is similar for the whole of Europe. This is also applicable to the USA, where the market ramp-up of e-bikes is only beginning.
“There are clear parallels to the automotive industry in the development of the bicycle industry. The higher the investment for a bicycle, the more relevant financial services are in order to boost and stabilize sales for manufacturers. Through the cooperation with Pon, VW FS intends to become Europe’s largest captive in the bicycle industry,” Dahlheim explained.
Volkswagen and Pon: A long tradition
The cooperation between Pon and the Volkswagen Group has a long tradition. For example, the Volkswagen Bus (Bulli in German) was created more than 75 years ago on the basis of a sketch by Ben Pon, Sr. The largest importer for the Volkswagen Group brands in the Netherlands is Pon. Just recently, Porsche and Pon announced the establishment of two joint ventures for the development of e-bikes and solutions in the field of micro mobility. In addition, the Volkswagen Group and Pon Holdings are together developing Europcar in the direction of a global mobility platform.
The investment of Volkswagen Financial Services AG in Bike Mobility Services is subject to approval by the regulatory authorities and by the Supervisory Boards of Volkswagen AG and Volkswagen Financial Services AG.
