Cargo bike economics

Tim from El Paso, Texas asks:

One thing that is becoming more apparent to me, is that I need to do more to prepare for peak oil and big bucks for gasoline. To be honest, though, I’m a little intimidated when you say you’ve spent almost $5K on your bike.

I wonder if you’ve done a spreadsheet of any type with gas at various prices to determine what the payback time is for a bike. That is my next exercise, to look at the $$ we spend on gas now for a pick-up and a mini-van and determine what the trade-offs for a bike, hybrid, electric, or other would be.

I don’t think Tim’s concerns are unusual.  The cost and the technology are still barriers for a lot of people.  I’ve done a lot of web searches that show interest in cargo bikes peaked about a year ago, when $3 gas was still somewhat shocking.  Now that the price has backed off a bit and we’ve become accustomed to that price, the interest in cargo bikes seems to have waned as well.  Most of the blogs I’ve found have a flurry of comments in 2008, somewhat less in 2009, and almost nothing in the first half of 2010.

If you approach this from a standpoint of pure economics, it’s not easy to compete with infrastructure and culture that is so optimized for cars (in the U.S., at least).  This is partly because gasoline is incredibly cheap for the amount of energy it delivers.  A gallon of gas weighs about the same as my bike’s battery, but it delivers 100 times more power.  Of course, gas wouldn’t be such a good deal if we factored in the costs to our environment (air pollution, carbon emissions, and oil spills) as well as national security.

But let’s play with the numbers we have.  I’m currently riding about 1000 miles per year on this bike.  As I’ve said before, those are tough miles for a bike or a car — mostly short trips up and down steep hills.  At this pace, I have to charge my battery about 3 times per week.  It holds 355 Wh of electricity.  At about 9 cents per kilowatt-hour, that’s roughly 3 cents per charge — less than a dime per week.

To do the same errands in our mini-van would take about 60 gallons of gas for the year.  That’s only $200 worth of gas at today’s prices, so I’m not going to recoup the $5000 cost of the bike and motor any time soon from savings at the pump.

However, I’ve saved money other places.  The bike has allowed us to avoid buying a second car.  Obviously, the savings are significant compared to the price of a used car, taxes, insurance, maintenance, and repairs.

But the main beneficiary is my conscience.  Showing my kids that there is a better way to transport ourselves without burning their natural resources at an unsustainable rate — that feels good.  I also see my neighbors more often, and I’ve had more opportunities to talk to people without the tinted windshield between us.  Most surprising, the bike saves time when traffic gets snarled around our neighborhood during school pick-up and drop-off hours.

The popularity of alternatives like this bike will increase as battery technology improves.  It makes so much sense to move just what you need, rather than pushing a ton of extra metal around when it isn’t necessary much of the time.  As it becomes easier, cheaper, and more reliable, this kind of personal transportation will become more common. 

In the meantime, I’m peeking into the future and enjoying the ride.

P.S. If you’re getting ready to take the next step in your own cargo bike adventure, you should check out this web site:  The author does a great job of describing all the options with lists of pros and cons and photos.  You’ll find some less expensive alternatives to my bike.  I’m just glad I don’t have to write all that myself!