Illustration of an e-bike and a car
Very few airports offer secure lock-ups where e-bikes can be charged, so people resort to cars instead. (Image: Getty Images)

MoneyMarch 21, 2022

Aghast at the price of gas? Now’s the time to think seriously about an e-bike

Illustration of an e-bike and a car
Very few airports offer secure lock-ups where e-bikes can be charged, so people resort to cars instead. (Image: Getty Images)

Petrol’s recent eye-wateringly high prices may have you wondering whether the costs of using a car outweigh its benefits. For many e-bike owners, ditching the gas-guzzler is one of the best decisions they’ve ever made.

“I adore the way it makes me feel, surging up hills like a fit eight-year-old is pure joy.”

Jane Strange, a student at Unitec, recently transitioned from commuting via car to riding an e-bike. She’s one of many who have made the switch, as ever-increasing petrol prices and environmental concerns push people away from fossil-fuel vehicles.

“We are seeing a strong surge in interest right now as gas prices rise,” says Michael Tritt, owner of e-bike retailer Electrify, “and the prospect of further rises is causing people to reassess their transport options.”

But for those who have been using their car for a long time, the prospect of replacing it with a bike can be daunting.

What reasons might there be to switch?

There are a few big motivators for using an e-bike over a car.

First is that big fat “E.” An e-bike, like any other electric vehicle, is significantly more sustainable than any gas-powered car. “If you’re motivated by environmental concerns, e-bikes are one of the cleanest forms of transportation available,” says Tritt.

“Bicycles are very efficient machines anyway, so adding an electric motor to that makes a really efficient and clean mode of transport compared to just about anything else.”

But if you’re just trying to be green, why not use an ordinary bike?

The answer lies in the benefits of that electric motor. “You can go further, faster, and without as much physical effort,” says Tritt. Vitally, this means e-bike users tend to be on their bikes far more often. “You may have a bike in your garage gathering dust, but if you’ve got an e-bike that’s not going to happen.

“You’ll be out on that thing three, four, five times a week.”

Electrify’s Michael Tritt takes daughter Ella for a spin on his e-bike (Photo: Supplied)

That ease of use makes e-bikes a more realistic option for those who don’t want to ride into the office covered in sweat. Beyond that, an e-bike is faster than a normal bike and, depending on your commute, could actually be faster than driving.

“If you’re trying to get into the central city at peak times, an e-bike is going to be a great option,” says Tritt. That is, of course, “unless you have to cross the harbour bridge, don’t get me started on that.”

The Auckland Council’s harbour cycling project was cancelled last year, just three months after its initial announcement – and has remained a sore point for cyclists.

But the most convincing motivator for trying an e-bike is cost. By saving on petrol, parking, and servicing, riding an e-bike can do wonders for your bank statement.

“I tracked my car expenses prior to buying my e-bike, yes I’m one of those people,” says Kyle MacDonald, a psychotherapist who switched from driving two years ago. “Within a year my bike had paid for itself.”

But what about that up-front cost?

For some, the search for an e-bike ends as soon as they see the price tag.

“The up-front cost is a challenge for a number of people,” says Tritt. “It’s a barrier to people who are in their 20s or don’t have as much disposable income.”

Amy Stewart, a writer who switched to an e-bike last year, agrees. “I’ll admit that I spent more on the e-bike than I ever did on any of the early-90s Toyota imports I’ve owned. The cost is prohibitive for most people.”

“I think there’s more the government and employers can do to help facilitate people into e-bikes,” suggests Tritt. “It’s the up-front cost that’s the issue, not the ongoing cost. If I ride a hundred kilometres on my e-bike each week, it only costs about $0.20 worth of electricity.”

Tritt advises against spending any less than $2000 for a bike. Will they get cheaper? “Not really,” he says.

But it’s not all bad news, as the quality of bikes keeps improving. “That entry level price point of two to three thousand hasn’t really shifted, but the level of componentry is better than what it was. I think that trend will continue.”

That cost puts a lot of pressure on security, with theft being a prominent fear among owners.

A good lock is vital. “That’s your best insurance policy against theft,” Tritt advises. “There are actual insurance policies as well, of course, if people want to go that route.”

E-bike convert Jane Strange on her pride and joy (Photo: Supplied)

Right, you’ve decided to buy an e-bike. Where do you begin?

It can be overwhelming to walk into a store and be confronted with dozens of brands and models, but there are some key points to look out for.

“The first question to ask yourself is ‘how will I use it?’ Once you decide that, the bike will follow,” Tritt advises.

If you’re anything but a sports rider, Tritt suggests going with a step-through frame – a more upright frame without a crossbar. “The majority of e-bikes sold in New Zealand are step-through frames,” he says. “Because they’re easier to get on and off, and are more comfortable.”

Your next consideration is the motor system. For commuters, Tritt finds that the cheaper and less refined hub-drive is preferable, while leisure riders may enjoy the smoother and more expensive mid-drive.

It’s also important to make sure the bike, and its battery, are from a reputable brand with a verifiable history. A good battery should be rated for 500-800 charge cycles, meaning it will last through multiple years of regular use before starting to degrade.

“Most good manufacturers will have a supply of replacement batteries that you can buy, or if it’s within warranty you can replace them for free.”

But not all manufacturers have the same level of support.

“There’s a bit of a gold-rush mentality with e-bikes, and lots of people are jumping into the market. I’ve seen situations where places haven’t been able to follow through on the after-sale support.”

Once you’ve considered all those factors, you’ll have narrowed it down to just a few good options.

So, is an e-bike right for you?

If there’s one constant between owners, it’s that they love their e-bikes. “It’s not an exaggeration to say it’s been life changing,” says Kyle MacDonald. “Even in the middle of winter, I look forward to my rides home.”

“It makes the most mundane of trips feel fun,” says Jane Strange.

“Even if it’s dark out and raining, just being outside for longer each day has made me feel so much better,” says Amy Stewart.

Even amid frustrations over Auckland’s lacking cycling infrastructure, optimism reigns supreme. “Infrastructure has a massive impact on how enjoyable biking is,” says Stewart. “[But] when all the cycle path projects are completed, the commute will be bliss.”

But more convincing than words, says Michael Tritt, is trying one for yourself.

“My number one recommendation for anyone considering an e-bike: don’t rely on the blurb, don’t rely on the numbers.

“There’s nothing like getting on the bike to understand it.”

 

Keep going!
Tahana Tippett-Tapsell (Tainui, Ngāti Paoa, Te Arawa and Ngāti Raukawa). (Photo: Supplied; additional design: Archi Banal).
Tahana Tippett-Tapsell (Tainui, Ngāti Paoa, Te Arawa and Ngāti Raukawa). (Photo: Supplied; additional design: Archi Banal).

MoneyMarch 17, 2022

The money man sharing ‘mokopuna decisions’ with Sharesies

Tahana Tippett-Tapsell (Tainui, Ngāti Paoa, Te Arawa and Ngāti Raukawa). (Photo: Supplied; additional design: Archi Banal).
Tahana Tippett-Tapsell (Tainui, Ngāti Paoa, Te Arawa and Ngāti Raukawa). (Photo: Supplied; additional design: Archi Banal).

The homegrown investment platform is welcoming to the board table its inaugural ‘future director’, Tahana Tippett-Tapsell, who says he’s itching to help Māori and Pasifika create wealth for generations to come.

Growing up in east Auckland, surrounded by whānau that “didn’t have much, at all”, Tahana Tippett-Tapsell never knew there were investing opportunities beyond KiwiSaver. But as an investment manager for the Māori investment team at New Zealand Trade and Enterprise, hailing from Tainui, Ngāti Paoa, Te Arawa and Ngāti Raukawa, the 27-year-old thinks homegrown investment platform Sharesies is leading the way on making sharemarkets more accessible to everyday New Zealanders. It’s a mission that sits close to him as he gears up for his first board meeting next week as its inaugural “future director”.

“Sharesies has been one of the fastest-growing New Zealand companies,” he says. “I’m very proud to be a part of that and help it take its next steps into the future.” 

The year-long opportunity, offered by professional directors’ body the Institute of Directors (IOD), was something he couldn’t pass up. Tippett-Tapsell will attend and participate in all board meetings (without the voting rights of a fully-fledged member) and learn from an experienced mentor, while Sharesies’ board will benefit from being exposed to a perspective they might otherwise have lacked.

And his viewpoint is critical – investing is often not a priority for New Zealanders dealing with ballooning living costs including the price of food, which rose almost 7% in the year to February 2022. Meanwhile Māori and Pasifika households struggle the most to meet their everyday needs, hardly surprising when their median disposable incomes are the lowest among the country’s ethnic groups at $38,000 and $37,500 respectively for the year to June 2021. By comparison, median Pākehā disposable income is $46,000, and $44,400 for Asian households.

Even when Māori and Pasifika households do acquire wealth, it’s dwarfed by that of Pākehā. While the median net worth of Pākehā and Māori households both rose $14,000 over the last three years, for Pākehā households that bump took their median net worth to $151,000. For Māori households, it’s now $42,000 – a gap of over $100,000. The wealth gap is even more dramatic for Pasifika households, with a median net worth of just $16,000.

Tippett-Tapsell has first-hand knowledge of those inequities, alongside a perspective rooted in te ao Māori and a background in finance. He attended Te Rumaki Reo o Ngā Puna o Waiōrea, a te reo immersion kura on the same grounds as Western Springs College in Auckland, and for the last seven years has worked as a commercial banker for ASB Bank and more recently at NZTE helping Māori businesses and investors. That made him exactly the kind of person Sharesies was looking for, says co-chief executive Brooke Roberts.

Sharesies co-CEO Brooke Roberts. (Photo: Supplied)

In a bid to help close the wealth gap, Sharesies is starting to draw on the cultural and financial expertise of tangata whenua. In January, it announced Ngāi Tahu Holdings, the investment arm of the South Island iwi, had invested $3 million with a view to creating intergenerational prosperity for whānau members. Sharesies has added to its portfolio Tahito Te Tai o Rehua, considered one of the world’s first indigenous investment funds. The fund uses mātauranga Māori to screen and select NZX and ASX-listed companies against rigorous ethical and sustainable criteria.

Removing barriers to entry and unnecessary financial jargon is crucial to opening access to sharemarkets, says Roberts, as is ensuring communities aren’t excluded from participating in a sector that is still largely made up of men who are Pākehā. “We want to create a space where investing no longer is associated with being wealthy,” she says.

Raising awareness is part of the solution, says Tippett-Tapsell. When he speaks about financial literacy with low-income and isolated Māori and Pasifika communities he tells them there are opportunities out there that don’t require massive amounts of upfront investment. “Even if it’s $5 or $10, at least you’re making a start,” he says. “But hey, there might be people out there who absolutely can’t spare $5 – and I respect that.”

Investing is not enough though, and improving the financial literacy of whānau is key to helping them ride the roller-coaster of wealth creation, he says. Māori generate wealth not for wealth’s sake, but to care for their whānau and to spend time on things that really matter, like mokopuna. In fact, “mokopuna decisions” is how the future director explains intergenerational wealth – for Māori, the financial decisions they make today must benefit not only their grandchildren but their grandchildren’s mokopuna.

Dr Jim Mather (Ngāti Awa, Ngāi Tūhoe). (Photo: Supplied)

It’s this understanding that makes Māori well-suited to governance roles, says Dr Jim Mather (Ngāti Awa, Ngāi Tūhoe), a professional director who chairs the boards of RNZ and Lakes District Health Board. 

Good governance is critical to a company succeeding, failing or staying stagnant. From startups to high-growth businesses, management teams are often busy working in the business, so rely on a group of advisers – most often a board of directors – for help working on the business. Directors are the ones tasked with thinking about the “big picture” questions, like what is the company’s vision, what are its long-term aspirations and what may jeopardise or improve its chances of success. Besides ensuring the business complies with its legal obligations and can pay its debts, directors hold leadership teams to account on performance, because boards are accountable to shareholders for improving or harming the value of their stakes.

Mather says Māori directors bring an innate understanding of the relational nature of their task. After all, effective, competent governance depends on whanaungatanga, kotahitanga and manaakitanga – Māori concepts commonly found on the marae and in Māori communities. Boards are no different, he says: collaboration requires diverse views, vigorous debate among individuals with decisions made collectively, and mutual respect between members.

Governance is often perceived as a job that executives start doing once they’ve finished leading organisations or in the twilight of their careers. But Mather, a former chief executive of Te Wānanga o Aotearoa and Māori Television, thinks otherwise – it’s a viable career for anyone, including Māori. Tippett-Tapsell has caught the governance bug early – he has his sights set on more directorships in the future – but for now, he’s got enough on his plate.