Gogoro, the company behind Taiwan’s thriving two-wheeled battery-swap ecosystem, is poised to succeed where others have tried and failed – and now it has the money to do it.
On Monday, the company completed its merger with special purpose acquisition firm Poema Global and is now listed on Nasdaq under the ticker symbol GGR. Gogoro expects to receive approximately $335 million in cash proceeds of the agreement.
Gogoro’s public debut and fundraising success suggests there is a market for battery swapping stations, but only if the conditions are right. About ten years ago, the Israeli startup Better Place tried and failed spectacularly popularize battery exchange for electric cars. But it was both too early in the collective EV journey for such an endeavor to succeed and too much investment to build all the infrastructure needed to easily replace batteries in large four-wheeled vehicles en masse.
Supported by more favorable market conditions and much better timing, Gogoro was able to unlock the recipe needed to scale its battery trading system. But that doesn’t mean Gogoro’s business model will work everywhere – while cities like New York or San Francisco suffer from congestion and would likely benefit from a platform like Gogoro’s, too many habits surrounding people’s preference. Americans for four-wheeled vehicles would have to change to be successful, and Gogoro knows it.
Instead, the company is focusing on markets where it can win, namely dense Asian cities where two-wheeled vehicles are already popular. Gogoro will use the fresh funds from its IPO to continue to expand in Taiwan by diversifying into larger markets like China, India and Indonesia.
Why battery swapping is important
Since its inception in 2011, Gogoro’s “Swap & Go” battery swap solution – where riders of electric mopeds, scooters and motorcycles equipped with Gogoro batteries can easily replace a dead battery with a fully charged one – has become ubiquitous. in Taiwan. Coupled with Gogoro Smartscooter, which the company first discontinued in 2015 to advance its business model, the battery exchange system has enabled the adoption of electric two-wheelers.
In Taipei, a quarter of all new scooters sold last December were electric, and nationally, 97% of electric scooters sold in 2021 were either Gogoro scooters or powered by the batteries and charging infrastructure of Gogoro, according to data shared by the Taiwanese government.
Just last week, Taiwan has declared that all new passenger cars and scooters will have to be zero emissions by 2040 – the government is spending about $5.8 billion (TWD 168.3 billion) towards this goal, including using grants and other incentives to see the share of new electric scooters reach 35% by 2030 and 70 % by 2035.
“It’s a huge endorsement for what we’re doing,” Gogoro CEO and Founder Horace Luke told TechCrunch. “The business needs to be strengthened to take advantage of this transition and support our partners. We have Yamaha, Suzuki Taiwan, Aeon, PGO and a group of guys are looking for us to develop the infrastructure as they transition to electric.