Gogoro, the company behind Taiwan’s thriving two-wheeler battery swapping ecosystem, is poised to succeed where others have tried and could not — and now it has the cash to do so.
On Monday, the company closed its merger with special purpose acquisition company Poema Global and is now listing on the Nasdaq under the ticker GGR. Gogoro expects to receive about $335 million in cash proceeds from the deal.
Gogoro’s public debut and success in raising money suggest there’s a market for battery swapping stations, but only if the conditions are right. Around a decade ago, Israeli startup Better Place tried and failed spectacularly to popularize battery swapping for electric cars. But it was both too early in the collective electric vehicle journey for such a business to succeed and too much of an investment to build all of the infrastructure required to easily swap out batteries of large four-wheeled vehicles en masse.
Backed by more favorable market conditions and much better timing, Gogoro has been able to unlock the recipe needed for scaling its battery swapping 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 such as Gogoro’s, too many habits surrounding Americans’ preference for four-wheeled vehicles would have to change to make it successful, and Gogoro knows that.
Instead, the company is focusing on the 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 as it branches outward to larger markets like China, India, and Indonesia.
Why battery swapping matters
Since its founding in 2011, Gogoro’s “Swap & Go” battery swapping solution — where riders of electric mopeds, scooters, and motorcycles with Gogoro batteries can easily swap out a dead battery for a fully charged one — has become ubiquitous in Taiwan. Coupled with Gogoro’s Smartscooter, which the company first dropped in 2015 to help its business model along, the battery swapping system has enabled electric two-wheeler adoption.
In Taipei, a quarter of all new scooters sold last December were electric, and nationally, 97% of e-scooters sold in 2021 were either Gogoro scooters or powered by Gogoro’s batteries and charging infrastructure, according to data shared by Taiwan’s government.
Just last week, Taiwan said all new passenger cars and scooters will have to be zero-emissions by 2040 – the government is putting around $5.8 billion (TWD168.3 billion) toward this aim, including using subsidies and other incentives to see the share of new electric scooters hit 35% by 2030 and 70% by 2035.
“That’s a huge endorsement for what we’re doing,” Horace Luke, CEO and founder of Gogoro, told TechCrunch. “The company’s gotta be bulked up to take advantage of that transition and support our partners. We have Yamaha, Suzuki Taiwan, Aeon, PGO, and a bunch of guys are looking for us to build up the infrastructure as they transition to electric.”