In cities across India, a silent shift is redefining how hyperlocal shipments move. The next time you receive a grocery order, medicine drop, or package from a local seller, it’s likely arriving on a low-speed electric 2W operated by a gig worker. 

As platforms compete on delivery speed, convenience, and unit economics, this vehicle-as-a-service ecosystem — one that doesn’t rely on ownership or traditional logistics infrastructure — has become a core enabler. In this article, we explore the key demand-side trends, the evolving gig workforce, and how electric two-wheeler rentals are becoming a core enabler for India’s delivery-first economy.

Hyperlocal deliveries are booming

On-demand hyperlocal shipments have been growing at  ~39% year-on-year over the past three years. By FY25, the market is expected to clock around 3–4 billion shipments, with volumes projected to touch~10 billion by FY30. This growth is being led by the rise of quick commerce,  and is further supported by food delivery and other hyperlocal models.  

This surge in hyperlocal shipments is creating the ideal operating environment for short-distance vehicle models, designed for deliveries within a few kilometres, where speed, cost-efficiency, and trip frequency are critical. As platforms focus on tighter service radii and quicker fulfilment, the need for light and low-speed delivery vehicles is becoming a must-have. Additionally, with e-commerce shipments estimated at 4.8–5.5 billion in FY25 and projected to grow at 23-24% CAGR, reaching 15–17 billion shipments by FY2030, there is an even greater opportunity in the last-mile delivery space. This shift in demand is driving different fleet models that suit local logistics, making them a key part of urban delivery infrastructure. 

The platform-based gig workforce is the engine of the last-mile

The success of hyperlocal platforms does not depend entirely on technology, it depends on its people. The gig workforce is essential for last-mile fulfilment, offering platforms the flexibility and scale needed to meet surging consumer expectations. Over the past three years, the number of delivery-based gig workers in India has grown by ~21% annually. Projections suggest this workforce will continue to expand at ~18-23% CAGR over the next five years, driven by the continued expansion of delivery zones and growing consumer demand.

While the platform is a livelihood for the millions of gig workers, however, one of the most pressing challenges they face is vehicle access. Two-wheeler ownership still remains financially out of reach for many, especially those without a formal credit history. With limited monthly income and no access to loans or EMI schemes, most of them are forced to rely on outdated vehicles or borrow from friends and family. One of the biggest concerns for gig workers is making sure each delivery is cost-effective. For most riders, the key metric isn’t just the volume of orders completed, but rather earnings per kilometer. When asked about their top expectations from the gig economy, ~40% of gig workers cited higher earnings per kilometer as their primary need, alongside the expectation of incentives based on performance.

Although companies are making efforts to improve compensation structures, rising fuel prices, frequent repairs, and vehicle downtime continue to erode margins for delivery workers. To improve their earnings, gig workers need vehicles that are not only affordable but are built for high-frequency, low-cost operation.

The rise of electric 2W Mobility-as-a-Service (E2W-MaaS) 

To solve the twin problems of access and efficiency, a new rental-based vehicle ecosystem has begun where gig workers don’t need to own a vehicle to deliver. They can rent an electric two-wheeler on an hourly, daily, or monthly basis.  This Electric 2W Mobility-as-a-Service (E2W-MaaS) model is becoming a vital part of India’s last-mile delivery systems 

The segment is broadly divided into two categories:  

• Electric Two-Wheelers (E2Ws)- registered vehicles with motor power exceeding 250W and speeds above 25 km/h 

• Low Speed E2Ws – these are vehicles with power output capped at 250W and a speed limit of 25 km/h; these are exempted from registration under current norms.  

Among these, low-speed E2Ws are emerging as a key enabler of last-mile delivery, especially in the gig economy. Despite often being overlooked in official data, their low cost, plug-and-play usability, and exemption from registration, insurance, and license requirements have made them a popular choice for commercial use in the gig economy. Over the past two years, the number of such low-speed E2Ws has grown at a ~21% CAGR, with an estimated ~1.6 lakh units currently in active use. Many of these vehicles, though technically meant for personal use, a large portion of these vehicles are deployed for commercial delivery use cases—serving food, grocery, courier, and e-pharma segments across dense urban zones. 

This growth is closely tied to the rise of E2W rental models. Fleet operations in this low-speed segment typically follow two models: 

• Direct Rental Model: Here, players rent bikes to gig workers directly, allowing them to choose preferred platforms and work hours  

• Platform Partnership Model: In this, players partner with platforms or logistics companies to provide both bikes and riders as they require, for which the platform pays either a per-order fee or a rental fee to the player 

Alongside these organized models, there is a large presence of informal setups, typically neighborhood-based fleet holders who rent out bikes on a daily or weekly basis. While the players may differ, the underlying value proposition remains consistent: access to affordable, service-ready EVs without ownership hassle. 

India’s E2W-Mobility as a Service model is remarkably distinct in its use case. While China focuses on daily commuting, India’s focus is on the hyperlocal delivery-driven E2W MaaS model. That’s because the economics here are fundamentally different and much more challenging for workers. Gig workers in India face a higher cost of ownership for E2W compared to their counterparts in China.  

This stark difference underscores a critical point: the key barrier for gig workers in India is vehicle affordability. Even though platforms are working on improving incentives, the reality is that without affordable vehicles and cost-effective solutions, gig workers in India struggle to maximize their earnings per kilometer. This income gap, along with high vehicle costs, limits their potential within the gig economy, making affordable electric vehicle options essential in India’s delivery landscape. 

Growth trajectory and expansion of the E2W MaaS Ecosystem

The rise in hyperlocal delivery demand is driving the growth of the E2W MaaS segment, with gig workers eager to optimize their earnings.  The current penetration of such a model is at a nascent stage, with limited vehicles on the road. As these businesses increase the vehicle count and new gig workers enter the platform delivery business, and existing platform gig workers aim to optimise their earnings, such models will scale, leading to revenue growth. With more regulatory support for electric vehicle use and low-emission transport, this sector is growing rapidly. Several businesses are already achieving strong revenue growth and EBITDA-positive status without burdening gig workers. Additionally, ride-hailing, e-commerce logistics, and other short-distance urban mobility applications provide further avenues of growth for E2W MaaS. 

At Redseer, we help platforms, investors, and startups understand the E2W-MaaS opportunities better. For investors and founders, now is the time to focus on industries that serve as key enablers of the hyperlocal delivery ecosystem. With the rapid surge in quick commerce and the growing demand for faster, greener, and more efficient delivery solutions, sectors like E2W MaaS are emerging as critical infrastructure. If you’re looking to analyse or invest in the micro-mobility space as a play on the quick commerce theme, reach out to us for the relevant insights.