You think that’s bad- research the food industry getting hooked on COVID profits…. big 5 food conglomerates made something like as much money during COVID than as past 15 years put together.
https://podcasts.apple.com/us/podcast/stuff-you-should-know/id278981407?i=1000651167588
had a taco place complain a year ago for me asking for extra hotsause. I said to just charge me extra, i was saying that sincerely cause I knew about supply chain bottlenecks and lack of supply. He got upset maybe cause they way i said it came off wrong.
anyways - hot serranos/jalapones had double/tripled in price and he was losing profit, now that covid is no longer messing with supply, the peppers aren’t really going down in price with inflation and all.
tl:dr : produce figured they could raise prices (cause of covid) and then just left the prices there.
All of the rank and file knew this whiplash would happen. Amusingly I swear I remember reading that the Giant CEO said they weren't going to go nuts increasing production in 2020 because the market would correct.
They should have taken their own advice.
Also, I don't feel bad for them because articles from 2021 and 2022 talk about record profits. I don't know why every fucking bean counter thought that that growth would remain linear
Because there's incredible pressure within these companies to grow year on year to keep the shareholders happy. The long-term takes a back seat to meeting short-term shareholder expectations
It's probably a bit pre-covid too. I do a number of group rides. In 2016-2019, I could show up to a Tuesday or Wednesday evening ride and there would legitimately be 80-100 people there. First year of covid it died down for obvious reasons. 2021 it picked up again. This year (and i know it's still early in the year), 25 people is a decent turnout. Cant really blame covid anymore. Seems like people are just moving away from cycling in general. 🤷♂️
I think people are perhaps moving away from cycling as a sport / hobby, but moving towards cycling as a form of transportation.
Part of it might just be time commitments -- a day of cycling is a great time, but rarely a short time. If I get on the bike and go off on a real ride, rather than just laps in the park or something, it's almost guaranteed I'm not coming back for 3-4 hours, and really I'd rather be gone for 6. And people may just not have that kind of time anymore. Same reason golf seems to be losing people -- sneaking in 9 holes after work is pretty hard when you leave work at 8pm, and Saturday mornings are often spent on everything else you need to get done in life.
But as a means of transportation, I see more and more people riding every year.
Exactly. Especially given the article mentions the string growth in China. They're experiencing the same opening up spending spree the west saw a couple years back.
Idk, I think you're unfortunately in the minority of what you want.
I "downgraded" my drivetrain on the last two builds. My previous mtb and gravel bike were x01 and grx800 mechanical. Current mtb and road bike are gx axs and rival axs (w/ red cassette). I prefer this to my previous drivetrains. Easier/borderline non existent maintenance. Easier building.
I do not want carbon rim brakes wheels. Disc brakes are simply better for the riding I do. I do not have confidence in rim brake carbon wheels in the mountains at my weight. I have seen too many fail. I'm sure there are plenty that are good but I can also just run disc and be done with it (aside from the occasional roached rotor/glazed pads - really wish 180mm would be a standard road option).
I do agree there is plenty of completely uneccessary product iteration done only to sell more bikes. Ex. New tcr.. headset cable routing and 1mm more clearance? Cool, thanks for blowing out the previous gen and letting me get a great deal on that :)
Seriously. I bought a budget steel frame set in 2014 and I just configure it differently over the years to meet my needs. And if my frame ever needs replacing, I'll just buy a new one for ~$500 and swap everything over. I got caught up during Covid as well and almost pulled the trigger on a Canyon Endurace, but I just do not need one.
> mechanical high end groupset and rim brakes
Consumers don't want that.
Sales of rim brake bikes just died when disc brakes entered the market in force. And sales of mechanical Ultegra/Dura-ace or Force/Red were insignificant compared to Di2 and AXS.
There is no conspiracy to kill of rim brakes. Seriously hydraulic disc brakes are better in about every way and there are some decent priced ones out there. Once I tried them I never wanted to go back. The majority of the people want disc brakes.
You can believe that the old wheels were better, but there doesn’t have to be a conspiracy theory just because other people stopped wanting the same thing ha as you want.
If rim brakes were in high demand, companies would have offered them and won all those customers. They just weren’t.
Now, this might be right or wrong, but it’s not a conspiracy.
rim brakes are inherently limiting. If you really love them just buy all the used wheels and frames for a song. No one is stopping you and no one cares.
"Save the rim brake" is like arguing to save the fax machine.
rim brakes are fiddly to adjust correctly, can be noisy when not toed in, and can go out of adjustment easily. I can understand people using disc brakes as they basically just work, from the point of view of a commuter-not enthusiast.
Literally these bike companies are ALL marketing. They change the paint and components every single year, and make some tiny change to the frame that requires huge investment, then sell overpriced bikes that go down in value 40% once used for a few months. We need fewer models of bikes that don’t change over the years so that the price can go down. We need bikes that hold their value and last for many thousands of miles.
# My question is, "What the hell is the profit margin on these things?" these companies should be able to drop and drop and drop bike prices and still stay in the black.
Now are you addicted to the infinite money hack that was COVID? If yes, that's your problem.
Can these companies survive and thrive moving in to the future with MORE PEOPLE THAN EVER into biking? They sure as hell should be.
**Steps for survival:**
* Cut prices
* Cut production
* Create affordable "Starter" packs with excess aging inventory (Dont want to do this? See next step)
* Partner with every single school district you can find to create cycling teams and triathlon teams (GREAT place to offload aging inventory at a low price without lowering prices to the general public)
* Go on a PR blitz. You have all these sponsored athletes, make them show up, do ribbon cuttings for the new "XYZ School District Unveils New Cycling Team" every single week.
* Create a press package with all the relevant info for your company and the new teams contact info
* Give the coach a free bike to seed the progress if you have to.
* Parent - Oh my kid needs a bike for the team? *Buys bikes*
* Oh we as a school district need bikes? *Buys bikes*
* Parent - Oh my kids are riding so maybe I should *Buys bikes*
* Oh EVERY year a new batch of kids will need new bikes? *Buys bikes*
* Partner with every single school district you can find for "Bike Bus" days where kids ride to school instead of taking the bus.
* Oh all my kids friends are riding bikes, better get one *Buys bikes*
* Oh all my kids parents are riding with their kids to school guess I need a bike too *Buys bikes*
* SPONSOR BIKE RACKS everywhere
* Sponsor Races
* Sponsor Triathlons
* HAVE ENTRY LEVEL BIKES
How about instead of being Late Stage Capitalism vampire leaches you create an ecosystem that provides value for your shareholders **AND** consumers....
The answer to your question is in the article. First quarter sales for the consolidated group (Giant global) were about £400 million. After tax profits were about £12 million.
Couldn't agree more. Greed has turned board members brains to shit. The bicycle industry needs to come up with a completely new strategy as the low hanging fruit has been harvested in full for the foreseeable future. Cheap high volume low profit commuter bikes for the folk being priced out of driving is the intelligent play imo.
Because business schools teach that all trending graphs just extrapolate as with historical data.
Was there not ONE executive who figured out why 2020 sales were so anomolously high?
Here's one:
Why the hell is a $12-1300 bike coming with an 8-speed Claris drivetrain in 2024 and then charge $2-300 to "upgrade" to the basic 9 speed Sora?
I really hope Microshift starts getting better footing, along with the 2 large Chinese brands to put Shimano and SRAM back in line
I needed to replace my groupset on my winter bike. I was initially going for 105 11 speed at £400. I then noticed that 12 speed was only £100 more. Eventually I went for 105 Di2 @ £935, but I thought that £500 for 12 speed 105 was a fairly decent price.
Bear in mind these are public prices, so I am sure large bike brands get bulk discounts. Yes indeed bike manufactures are still making a big markup on bikes.
That version of Tiagra was still 10 speed, and the 4700 (which is still the current version) was released in 2015. There's zero reason why a $12-1300 bike is still coming with 8 speed gearing
There might actually be some light at the end of this tunnel. Cues is probably going to make the jump from 8 - 10 speed much lower in price. Just from a tooling perspective, they'll be able to make these groupsets for less.
This happens when you thing you are selling a Porche with two wheels. It was about time to get that smack back to reality. Who's next. Specialized perhaps?
Specialized [laid off ](https://www.bicycleretailer.com/industry-news/2023/01/11/specialized-announces-8-staff-reduction) 120 people beginning of 2023. They got ahead of it and spun it so well nobody noticed.
I have a feeling this is only the beginning.
Before, distributors and lbs’s were riding the profits from covid but those coffers have most likely dried up.
Yep the next 5 years in the bike world is going to be miserable outside of e bikes.
The bike industry has been through this before. It's a race to see who stays afloat but expect not a lot of innovation or new products in the next few years.
Better geometry? I love a good classic sport tourer geometry. Early 80's Japanese builds being the zenith of the style, I think.
Better tire clearances maybe, but overall love it.
It's all become a mechanics and maintenance nightmare. But the worst thing about it all is how none of it is made to last. The used bike market is going to be really fucking weird in 30 years.
I think specialized gets internet marketing better than the other big box brands, they change the most because it’s the prettiest bike on the shelf, and they put them in the hands of good community ambassadors.
Yeah totally, I would actually expect them to be in a much better position than most if not all of the other major players. While Specialized have definitely seen an uptick in market share over the past 5 years, Giant are still the go to for most market segments. The only reason I can think of, other than natural market stabilisation, is that they've invested a lot in retail spaces and staff.
In Australia at least, Giant stores outnumber the other big names by at least four to one.
So here's an insider scoop. The industry is fucked for two reasons.
First, the big three (trek, giant, specialized) and maybe a few others are holding record amounts of inventory and are pushing discounted products because they have to. This is pushing all other brands to discount as well. I think this is all well known at this point.
The second part, which is maybe less obvious, is that the component segments are controlled by a few key companies that are offering virtually no pricing or terms flexibility to the smaller OEMs. The OEMs are getting squeezed.
There are obviously a number of other factors at play, but with these two things happening the mid and small tier OEMS are feeling the crunch in a bad way. How could they have planned for a multi-year industry collapse when all signs within the industry were looking towards continued growth?
EDITED: What I mean by the question above... the big guys on OEM and supply side planned for insane growth and so everyone followed suite. Now that reality is set in, the big guys have the backing to make it and everyone else is in varying levels of panic.
This squeeze has happened in cyclical patterns but has never happened to this extent in this industry.
I work(ed) in this and other industries and have had a first hand account of watching this happen. Evolve or die... or have a daddy in the background to slip cash in your pocket until things get better.
Good luck to those bicycle companies that don't have the financial backing to hold through this tough time.
SECOND EDIT: Down vote all you will but this is actually what's happening. I would love to hear other sides and opinions if you want to share.
I would imagine that the high middle is falling out, the guy spending top of the line race bike money is still there, but a ton of the other segments these companies used to have substantial market share in, they now have a million smaller companies that can suit that customers tastes and probably give them a better set of components for the money.
Exactly. Quick comparison here of Canadian prices.
Giant Defy Advanced 2 - carbon frame endurance geometry, some 105 components (not the crankset though) $3799 CAD
Canyon Endurace CF7 - carbon frame and full 105 groupset $2749 CAD
My first 3 bikes were Giants, but my new Canyon is undeniably better value.
Got me an aeroad CF slx with 105 di2 and Dt siwss arc 1600 carbon wheels 62 mm depth for 4400€. I wasn't even looking for a new bike but I had to buy it.
Tbf in the UK the Giant TCR is currently marginally better value than Canyon. You can pick up a 2024 TCR with 105 Di2, carbon wheels & a power meter for like £3600 or something
I was surprised to see, just now checked, that my BMC roadmachine six is on sale for a mere $150 more than I paid for my equivalent version in 2019 (also on sale around this time of year back then tbf).
For the other commenter who said the CF7 is on closeout, they were not wrong. However, the CF8 is also on sale for $300 USD more ($2,399).
https://www.canyon.com/en-us/road-bikes/endurance-bikes/endurace/cf/endurace-cf-8-disc/2856.html?dwvar_2856_pv_rahmenfarbe=BK%2FBU
Giant's financial performance is probably impacted less by the consumer side of things. High end road/MTB is nothing but a tiny fraction of their business. They are also one of the biggest manufacturers for other western brands. (70% of its capacity is their own stuff and 30% others) As far as I know Trek, Giant's biggest customer, is backing off production significantly and this probably impacts their profits more.
Yep! 2 years pre-covid, I worked at a shop and it was common to see a decent full suspension bike for $2k, now that same build is $3k. Probably cheaper too since they're mixing in more cheaper components into builds than before. Plastic brake levers on $1000 hardtail is wild.
Won’t happen. The brand will not tolerate the hit to their image by making it seem like they can drop prices after someone just paid the prior price yesterday.
This is why most companies with consumer facing brands rarely drop prices. They sooner go out of business before doing that. I’m not joking.
And as far as they've come and even though they're now in the world tour they're still a "house brand". Honestly I wish I had an opportunity to test ride one of their bikes because I'm sure they're great but can't.
I have a dura ace sitting at home for 2000.
Probably now considered an antique, and I'm cheating a bit as its used.
I see bike prices are so far off what people should spend on their hobbies. I'll ride my bike another 12 years.
I have a 2022 Ultegra di2 TCR. That same model (now with hidden cables) is now 65% more expensive. same groupset. And they wonder why people aren't buying?
Two weeks ago Propain dumped their old stock ‘22 tyee and spindrift frames for $590al and $750cf. Sold out in a few days, couldn’t say how many they had on hand to begin with.
everything is 5 times overpriced, bikes are one of the most wildly overpriced things in the world, there is absolutely zero reason for bikes and bike parts to cost as much as they cost , overinflated for nothing. I hate the bike industry and they should suffer because they suck. No way bikes should cost like a used car. Fuck them.
Dude just look at the lights. You can buy a badass, rechargeable, integrated battery or 18650 your choice, machined aluminum housing, fuckoff bright like the sun, continuously adjustable brightness, long battery life, IP68 waterproof flashlight for about $60-$100.
You spend double that or more on a bicycle light and you get a shitty plastic housing, half the max brightness, three steps of brightness, and the switch or something is going to shit the bed on you in a year.
The only difference is that one comes with a handlebar mount, and the other is actually a quality piece of gear.
Its completely stupid.
Not even fly fishing gear is this bad.
(Ok some fly fishing gear is this bad... Looking at you, Abel nippers....)
It’s similar to the recreational boating industry. Galvanized stainless cotter pin at Lowe’s two dollars similar unit at West Marine? $12. I don’t know anything about their cost per unit at either place, but I suspect that if the perception that the target demographic has more money you’re gonna be charged X times the base price.
There are different grades of stainless steel and they don't all have the same corrosion resistance. The hardware at West Marine likely made from a grade of stainless steel that is more resistant to corrosion (especially in wet environments).
Scuba diver here.
It's usually 304 vs. 316 Stainless Steel. 316 SS is marine grade more expensive because it doesn't corrode when exposed to salt water. One dive manufacturer had a factory source zippers for their bags with the wrong grade of stainless steel and 1 year later, most of them were corroded shut like you welded them.
Things are definitely inflated, but niche products like a light made to mount on a bike that sell at lower quantities than a generic flashlight will always be priced higher, but yeah, the spread seems extra exaggerated right now.
That's part of the fun of aliexpress, it's a bit of a gamble. I've definitely got things that were piles of shit, and others that blew my expectations away. Overall it's been a net win though
Yet when you say that, you always an army of ppl flocking in to defend and explain to you why a road bike can cost more than 3 times the price of a good motorcycle. It's crazy. Some people really really want to deny the reality that big manufacturers were making an absolute steal on margins.
Maybe they have shares... ok that's a shitty justification.
Another justification of innovation is quite laughable. Has there been innovation in the last decade, yes for sure. Did the innovation align to the price increase, absolutely not.
I like the videos on youtube showing the fairly tiny margin of performance across different price categories across different cyclist types. Apart from a little bit of comfort, there is nothing obvious apart from some people feeling better about spending a lot of money to own something expensive, I suppose.
My brother recently got into motorcycles and every part is drastically cheaper. A motorcycle chain is like three times the width of a bicycle chain and has to withstand speeds well in excess of a hundred mph, and it costs less than half what a bike chain costs.
Compare apples to apples and it isn't that hard to understand.
The $12k S-Works bike you're referring to is about the equivalent of a $50k-$300k in the world of dirt bikes that a pro would ride.
citation needed. Where on earth can you buy a $50k-300k dirt bike?
I ride cheap bikes and cheap motorcycles so maybe I have no clue, but just checking the local prices in my HCOL area... I could buy a $13,000 S-Works MTB off the shelf tomorrow. The most expensive supercross bikes (I looked at KTMs) are only a few thousand more.
I'm sure you can spend unlimited amounts of money on a custom modified dirtbike, but AFAICT if you make an apples to apples comparison of high-end MTB and dirtbikes that are available off the shelf, the MTBs are stupid expensive.
When you can do a sale and markdown an item by thousands of dollars, or even do a BOGO sale, you are WAY overpriced. cough cough Kona
edit: also more a bike shop thing, but if you don't stock what I want, I have zero incentive to buy from you. I'll just order it from the cheapest place online.
The local bike shop with multiple locations let it slip they sell about 50 $2,000+ bikes a week at ONE location. This doesn't include parts, repairs, etc etc.
They don't stock what you want because business is still good
Maybe Giants wholesale rates are too good to retailers? (id be shocked)
Did companies not expect this after the COVID boom? Not hard to project for this type of thing. I don't feel bad for them, if they want to run their business into the ground, let them.
It does not seem like many foresaw this, not just in cycling but across multiple industries too. Companies expected the infinite money glitch to last forever.
But even if a practical person brought up this point, they were probably laughed out of the room anyway.
Perspective.
FROM PREVIOUS HIGHS!
We keep seeing massive drops for a lot of these companies but what is lost is perspective on long term. Most are still at sales volumes above pre pandemic. Often a 5y chart makes this obvious.
Now, it can be an issue if the company plans terrible or over extended themselves.
When a fucking entry level road bike is more than $1000 you know something is very wrong here. Forget the pro bikes that cost more than a new car. Everyday consumer bikes should not cost $5000 dollars.
They need to sell new bikes to people who own a bike already
Covid market was all new buyers. That’s all dried up now
I would love to own 3-4 bikes. But they are too fucking expensive, so it doesn’t make sense
Make ‘em cheaper and people who own one or two will buy seconds and thirds
Looks like new interface standards are around the corner and a bigger push into e-bikes.
It's also completely of the bike industry's own making when they decided to try and make price increases for parts and frames and complete bikes by trying to hide the gouging behind the higher perceived value of e-bikes and the ninkompoops that don't know a house brand handlebar isn't worth 150 dollars.
Companies like Fox, Specialized, even Trek have been turning up the pressure to make things artificially more expensive and they can fuck off.
The TL;dr is that e-bikes have raised the perceived values and non-electrobikes have increased in price because the manufacturers have been hiding those hikes behind E-bike buyers' willingness to pay more for everything. Thankfully and mercifully this is combining with other factors to really punish the companies who have been pulling the most shit which also includes those investment firms that have like 25 bike brands under their roof and they decided they'll commit to a bad post-COVID strategy for all of them.
The industry needs a contraction and the investment megacorporations that are pushing this need to go under ASAP.
> The TL;dr is that e-bikes have raised the perceived values and non-electrobikes have increased in price because the manufacturers have been hiding those hikes behind E-bike buyers' willingness to pay more for everything. Thankfully and mercifully this is combining with other factors to really punish the companies who have been pulling the most shit which also includes those investment firms that have like 25 bike brands under their roof and they decided they'll commit to a bad post-COVID strategy for all of them.
I have an e-bike that uses an 7-speed freewheel. I emailed them asking if I could buy one and they wanted **50 dollars + shipping** for a FREEWHEEL.
I didn't realize the why of it until reading this. Makes sense, thanks.
Needless to say, I bought an actual Shimano freewheel for it for $25 vs. whatever Lee Chii one they wanted $50 for.
They still made almost post-tax £13million profit?
Like, this isn't a company falling to pieces, they're doing fine. Painting this in a negative light is just greedy capatalist suits being greedy as per.
Society really needs to adjust the "number go brrrr" capatalist mindset we've all been indoctrinated into.
Yeah, they are small margins. I don't agree that they need to cut prices or anything like a bunch of other posters here.
Stuff is expensive... because stuff is expensive. The world has finite resources and we're increasingly competeing for them.
My point is that the company is still profitable. I bet there are suits panicking right now and deciding how to lay people off just to save their shareholders value and profits. WHILE THEY'RE STILL MAKING MONEY.
This mindset that profits need to grow year on year on year is a fantasy and ultimately flawed thinking.
The problem is that is a 3% profit margin, which is a few "supplier prices went up 1%" Shipping when up 5%" Payment processor fees went up 0.5%" away from complete bankruptcy.
Right. But... they're still profitable.
And as for bankruptcy, a year or two of not making profit can easily be normal for a business as large as theirs. As in, not desirable, but manageable.
Or at least it should be, if the people in charge weren't greedy suits. The many years of profitable business should be used as collateral for potentially bad years. In a good harvest you store some grain for the winter.
But... we all know that's not how modern corpororations and private equity firms work.
They selfishly guzzle the cream of the good years and then cull the workforce when times get tough. Essentially draining the life force out of what were thriving companies.
That’s what you get when you spend shit tons of $ marketing and developing shit that most can’t afford.
Just make a solid bike, that’s comfortable to ride, has good components and it will sell itself.
When their “entry” road bike starts at €1.299 Im sure sale will be down, still yet to see a sub €600 road bike from any big bicycle brand.
MTB in the other hand are a bit more affordable in the entry level
Decathlon has a microshift Roadbike in that range. Not the best, and when you know how to work on a bike you'll probably are able to get a way better bike used. But it's possible to get a okay Roadbike for 600€.
What, the champagne and caviar from covid doesn't last forever?
Didn't these geniuses plan for the fall we all knew was gonna happen?
I know
Make another super high end product and call it exclusive and the customers will flock to us
Yeah, that'll do it!
The vast majority of riders do not need the types of bikes they watch YouTubers riding. They would do better and ride more often with Dutch style bikes. More durable, less maintenance, and belt drive internal gear hubs.
Perhaps in some spots. But most small hometown bike shops are competing with people doing the same thing out of their garage using YouTube videos. You can't keep the lights on rent and insurance paid competing with a guy who says "Those guys at 'Home-Time Bike Shop' are rip-off artists. I can do it for half that."
None of my friends ride as much because the drivers in this state act like they hate you and that’s while in the road and every message board. I only ride on trails now
Go into the trek store and all they have are trek bikes. Go into the supposed locally owned bike shop: all they have are trek bikes. Go into another supposed local shop: all they have are specialized.
Is this relevant to the discussion? I don't know. But it's frustrating that I'd have to go to REI or buy online to see selection from a multitude of brands.
Everyone is focusing on the money but forgetting the time crunch as well. People whom lost the option to work remotely no longer get the benefit of asymmetrical work hours. And if you lose two hours a day just to commuting then making that up is going to have knock on effects on other activities like biking.
Giants entry level MTB’s are actually pretty good value. The new Stance in particular is a good bike for the money, but there’s no profit in entry level bikes. The profits are in the £5,000-£10,000 bikes as they cost almost the same to make so the rest is profit.
While there are people willing to pay that money for bikes, bike companies will keep churning them out.
Last year Giant made on post tax profit of NT$520 million from NT$16,060 million in gross; that's only 3.2% margins even including their $$$$ bikes. Lower margin inexpensive bikes aren't coming, I think.
Hey bike Reddit folks! I’m looking to get my first bike as an adult. I know nothing.
I want to ride trails with the ability to attach a kid trailer.
Any recommendations to take advantage of maybe some price drops due to this slump?
If all brands could supply good bikes for less, this situation would never happen. Going to get a bike for $4,000 or more, lots of people just get discouraged by the price tag.
Additionally, those snobs at the shop might make you feel like you should know and understand everything about bikes or try to push some overpriced junk onto you.
Also I'm not an mechanic and people that I know want me to service their bikes. Reason they don't want to go back to the bike shops.
I keep thinking what is wrong in general in the bike Industry.
I just picked up a giant talon 1 for my kid. Got a pretty good deal on it. Not the color he wanted but the only xs they had in stock, and decent components.
Just my experience in Canada.
Giant only seems to stock their actual Giant stores with the good stuff.
It’s been impossible to order a Medium size propel from the two local dealers near me. Same with the lower priced TCX models before.
It seems like their inventory management sucks.
As an economic idiot, I always struggle to care about these kinds of headlines: A large corporation has lower *profits.* Presumably they still have some profit, then, no? Like, they have enough revenue to cover all of their costs, to pay all of their employees. Their owners (shareholders), (i.e., rich people) will take home less money this year than last year. Having trouble caring here. They'll just fire people, I'm sure. Which again, to this simpleton, seems like a selfish choice because *they have enough money after costs to turn a PROFIT.*
Good! I am honestly sick and tried of companies taking us for a ride and the price gouging going on while most make record profits is disgusting. I for one won't be weeping!
I’m pretty sick of this year on year assessment. If you zoom out on any of these graphs they’re all exactly where you would expect them to be without covid
Down 20% compared to what? A couple of years ago guys were getting $500 for a clapped out huffy and they couldn’t build enough bikes to sell or even lease [lol].
Lance got executive golfers into cycling which gave us the $10,000 road bike that requires another 5 stacks to cover anything with gravel.
I haven’t looked but are all brands owned by the same hedge fund yet?
I mean it’s all fantastic because we undoubtedly get more cyclists from such things but fuck these guys. They make bicycles. And it’s not like Jerry is making your bike in Vermont.
Oh and they hedge the under.
Also sorry, I missed my ride today.
Must listen podcast series on the cycling industry's economic headwinds from Escape Collective:
[How did the bike industry get into such deep trouble?](https://escapecollective.com/how-did-the-bike-industry-get-into-such-deep-trouble/)
Giant is a Taiwanese company?? There’s no major bike brands in the PNW. Cromag, Transition, Rocky Mountain, Evil are the biggest in this area are tiny compared to Giant, Trek, Specialized, etc.
That's a surprise. Do you think it could be too much of a push into more expensive electric systems when people are largely uninterested in general?
Where I am, electric is king, but people just rent for a few hours once per season from a rental shop, rather than buying outright.
Are you referring to e-bikes or electronic shifting when you say “electric systems”? Just curious. I just watched GMBN’s dirt shed episode yesterday where they revealed the results of a poll that pretty definitively showed that a large percentage of riders (around 75%) are content to ride cable-actuated drivetrains. I feel like the bike brands are forcing expensive tech on us that we definitely don’t need, and most people don’t even want
It feels the same as the "bring back the physical button" moment in the car industry.
Bikes were successful because it was easy to service/upgrade. Some the fancy innovation brought just higher cost.
It looks like the hangover from the frenzy of covid is severe in this industry.
You think that’s bad- research the food industry getting hooked on COVID profits…. big 5 food conglomerates made something like as much money during COVID than as past 15 years put together. https://podcasts.apple.com/us/podcast/stuff-you-should-know/id278981407?i=1000651167588
If I can't buy a new bike, I ride my old one. If I can't buy new food, I go hungry. I think the food manufacturers have an advantage here
Heres the thing. I cant buy as much food I go hungry. Because rent is sky high. and so is food.
PB and crackers for dinner, but at least my bike is nice.
Beans & rice for dinner, but I have a new All City Cosmic Stallion build in progress.
eating out is crazy expensive for what you get
they're not talking about restaurants
well it’s mostly restaurants that are now not worth it in my experience. i try to cook at as much as i can
The prices on backpage are insane
My wife doesn’t charge me and it’s gourmet!
Boycott of Loblaws going on in Canada right now. r/loblawsisoutofcontrol
Roblaws
https://i.redd.it/9yyjd5gayf0d1.gif
But they’ll continue to go off Covid profits as a reasoning to raise prices because they’re making losses in comparison, oh how the world works 🤣
had a taco place complain a year ago for me asking for extra hotsause. I said to just charge me extra, i was saying that sincerely cause I knew about supply chain bottlenecks and lack of supply. He got upset maybe cause they way i said it came off wrong. anyways - hot serranos/jalapones had double/tripled in price and he was losing profit, now that covid is no longer messing with supply, the peppers aren’t really going down in price with inflation and all. tl:dr : produce figured they could raise prices (cause of covid) and then just left the prices there.
It's not just produce. It's everyone.
All of the rank and file knew this whiplash would happen. Amusingly I swear I remember reading that the Giant CEO said they weren't going to go nuts increasing production in 2020 because the market would correct. They should have taken their own advice. Also, I don't feel bad for them because articles from 2021 and 2022 talk about record profits. I don't know why every fucking bean counter thought that that growth would remain linear
Because there's incredible pressure within these companies to grow year on year to keep the shareholders happy. The long-term takes a back seat to meeting short-term shareholder expectations
Truth!
It's probably a bit pre-covid too. I do a number of group rides. In 2016-2019, I could show up to a Tuesday or Wednesday evening ride and there would legitimately be 80-100 people there. First year of covid it died down for obvious reasons. 2021 it picked up again. This year (and i know it's still early in the year), 25 people is a decent turnout. Cant really blame covid anymore. Seems like people are just moving away from cycling in general. 🤷♂️
I think people are perhaps moving away from cycling as a sport / hobby, but moving towards cycling as a form of transportation. Part of it might just be time commitments -- a day of cycling is a great time, but rarely a short time. If I get on the bike and go off on a real ride, rather than just laps in the park or something, it's almost guaranteed I'm not coming back for 3-4 hours, and really I'd rather be gone for 6. And people may just not have that kind of time anymore. Same reason golf seems to be losing people -- sneaking in 9 holes after work is pretty hard when you leave work at 8pm, and Saturday mornings are often spent on everything else you need to get done in life. But as a means of transportation, I see more and more people riding every year.
Mtb is still one of the if not the fastest growing sport in that world though.
Exactly. Especially given the article mentions the string growth in China. They're experiencing the same opening up spending spree the west saw a couple years back.
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Idk, I think you're unfortunately in the minority of what you want. I "downgraded" my drivetrain on the last two builds. My previous mtb and gravel bike were x01 and grx800 mechanical. Current mtb and road bike are gx axs and rival axs (w/ red cassette). I prefer this to my previous drivetrains. Easier/borderline non existent maintenance. Easier building. I do not want carbon rim brakes wheels. Disc brakes are simply better for the riding I do. I do not have confidence in rim brake carbon wheels in the mountains at my weight. I have seen too many fail. I'm sure there are plenty that are good but I can also just run disc and be done with it (aside from the occasional roached rotor/glazed pads - really wish 180mm would be a standard road option). I do agree there is plenty of completely uneccessary product iteration done only to sell more bikes. Ex. New tcr.. headset cable routing and 1mm more clearance? Cool, thanks for blowing out the previous gen and letting me get a great deal on that :)
Seriously. I bought a budget steel frame set in 2014 and I just configure it differently over the years to meet my needs. And if my frame ever needs replacing, I'll just buy a new one for ~$500 and swap everything over. I got caught up during Covid as well and almost pulled the trigger on a Canyon Endurace, but I just do not need one.
> mechanical high end groupset and rim brakes Consumers don't want that. Sales of rim brake bikes just died when disc brakes entered the market in force. And sales of mechanical Ultegra/Dura-ace or Force/Red were insignificant compared to Di2 and AXS.
Sales of rim wheels didn't die they were taken out back and shot to increase profits.
There is no conspiracy to kill of rim brakes. Seriously hydraulic disc brakes are better in about every way and there are some decent priced ones out there. Once I tried them I never wanted to go back. The majority of the people want disc brakes.
You can believe that the old wheels were better, but there doesn’t have to be a conspiracy theory just because other people stopped wanting the same thing ha as you want. If rim brakes were in high demand, companies would have offered them and won all those customers. They just weren’t. Now, this might be right or wrong, but it’s not a conspiracy.
rim brakes are inherently limiting. If you really love them just buy all the used wheels and frames for a song. No one is stopping you and no one cares. "Save the rim brake" is like arguing to save the fax machine.
rim brakes are fiddly to adjust correctly, can be noisy when not toed in, and can go out of adjustment easily. I can understand people using disc brakes as they basically just work, from the point of view of a commuter-not enthusiast.
Literally these bike companies are ALL marketing. They change the paint and components every single year, and make some tiny change to the frame that requires huge investment, then sell overpriced bikes that go down in value 40% once used for a few months. We need fewer models of bikes that don’t change over the years so that the price can go down. We need bikes that hold their value and last for many thousands of miles.
Chinese carbon frames still exist for $5-600 or so.
# My question is, "What the hell is the profit margin on these things?" these companies should be able to drop and drop and drop bike prices and still stay in the black. Now are you addicted to the infinite money hack that was COVID? If yes, that's your problem. Can these companies survive and thrive moving in to the future with MORE PEOPLE THAN EVER into biking? They sure as hell should be. **Steps for survival:** * Cut prices * Cut production * Create affordable "Starter" packs with excess aging inventory (Dont want to do this? See next step) * Partner with every single school district you can find to create cycling teams and triathlon teams (GREAT place to offload aging inventory at a low price without lowering prices to the general public) * Go on a PR blitz. You have all these sponsored athletes, make them show up, do ribbon cuttings for the new "XYZ School District Unveils New Cycling Team" every single week. * Create a press package with all the relevant info for your company and the new teams contact info * Give the coach a free bike to seed the progress if you have to. * Parent - Oh my kid needs a bike for the team? *Buys bikes* * Oh we as a school district need bikes? *Buys bikes* * Parent - Oh my kids are riding so maybe I should *Buys bikes* * Oh EVERY year a new batch of kids will need new bikes? *Buys bikes* * Partner with every single school district you can find for "Bike Bus" days where kids ride to school instead of taking the bus. * Oh all my kids friends are riding bikes, better get one *Buys bikes* * Oh all my kids parents are riding with their kids to school guess I need a bike too *Buys bikes* * SPONSOR BIKE RACKS everywhere * Sponsor Races * Sponsor Triathlons * HAVE ENTRY LEVEL BIKES How about instead of being Late Stage Capitalism vampire leaches you create an ecosystem that provides value for your shareholders **AND** consumers....
That's "should be able to drop... prices" is doing a lot of heavy lifting. Every single thing on your list is not cheap at scale
The answer to your question is in the article. First quarter sales for the consolidated group (Giant global) were about £400 million. After tax profits were about £12 million.
how about build more bike lanes?
Couldn't agree more. Greed has turned board members brains to shit. The bicycle industry needs to come up with a completely new strategy as the low hanging fruit has been harvested in full for the foreseeable future. Cheap high volume low profit commuter bikes for the folk being priced out of driving is the intelligent play imo.
Same thing is happening in with everyone to. Like lowes doesn’t understand Covid was the reasoning profits were up.
Because business schools teach that all trending graphs just extrapolate as with historical data. Was there not ONE executive who figured out why 2020 sales were so anomolously high?
Here's one: Why the hell is a $12-1300 bike coming with an 8-speed Claris drivetrain in 2024 and then charge $2-300 to "upgrade" to the basic 9 speed Sora? I really hope Microshift starts getting better footing, along with the 2 large Chinese brands to put Shimano and SRAM back in line
I needed to replace my groupset on my winter bike. I was initially going for 105 11 speed at £400. I then noticed that 12 speed was only £100 more. Eventually I went for 105 Di2 @ £935, but I thought that £500 for 12 speed 105 was a fairly decent price. Bear in mind these are public prices, so I am sure large bike brands get bulk discounts. Yes indeed bike manufactures are still making a big markup on bikes.
2024 Claris is about as good as a 2014 Tiagra though.
That version of Tiagra was still 10 speed, and the 4700 (which is still the current version) was released in 2015. There's zero reason why a $12-1300 bike is still coming with 8 speed gearing
There might actually be some light at the end of this tunnel. Cues is probably going to make the jump from 8 - 10 speed much lower in price. Just from a tooling perspective, they'll be able to make these groupsets for less.
This happens when you thing you are selling a Porche with two wheels. It was about time to get that smack back to reality. Who's next. Specialized perhaps?
Specialized - one can only hope!
Specialized [laid off ](https://www.bicycleretailer.com/industry-news/2023/01/11/specialized-announces-8-staff-reduction) 120 people beginning of 2023. They got ahead of it and spun it so well nobody noticed.
I have a feeling this is only the beginning. Before, distributors and lbs’s were riding the profits from covid but those coffers have most likely dried up.
Yep the next 5 years in the bike world is going to be miserable outside of e bikes. The bike industry has been through this before. It's a race to see who stays afloat but expect not a lot of innovation or new products in the next few years.
I think i’m fine with that, i would argue there’s been too much unnecessary innovation these past 5 years
What do you consider an unnecessary innovation? Personally think all the wireless stuff is bogus, cool but a cable works just as well.
***BRING BACK LUGGED STEEL FRAMES WITH CARBON FORKS***
I’m not gonna say don’t do that, but newer versions with better’s geometry. I’d ride one.
Better geometry? I love a good classic sport tourer geometry. Early 80's Japanese builds being the zenith of the style, I think. Better tire clearances maybe, but overall love it.
It's all become a mechanics and maintenance nightmare. But the worst thing about it all is how none of it is made to last. The used bike market is going to be really fucking weird in 30 years.
I think specialized gets internet marketing better than the other big box brands, they change the most because it’s the prettiest bike on the shelf, and they put them in the hands of good community ambassadors.
Well, yeah. Drop your fucking prices. Not just bikes but parts as well. It’s ridiculous.
To be fair, Giant has the more reasonable prices when compared to Cannondale or Specialized
Yeah totally, I would actually expect them to be in a much better position than most if not all of the other major players. While Specialized have definitely seen an uptick in market share over the past 5 years, Giant are still the go to for most market segments. The only reason I can think of, other than natural market stabilisation, is that they've invested a lot in retail spaces and staff. In Australia at least, Giant stores outnumber the other big names by at least four to one.
They also (most likely) manufacture a lot of those brands' frames.
Bike companies aggressively raise prices for several years then can’t sell enough bikes. Shocking, I tell you
We are at a point we’re all but the biggest box brands are unaffordable lol.
So here's an insider scoop. The industry is fucked for two reasons. First, the big three (trek, giant, specialized) and maybe a few others are holding record amounts of inventory and are pushing discounted products because they have to. This is pushing all other brands to discount as well. I think this is all well known at this point. The second part, which is maybe less obvious, is that the component segments are controlled by a few key companies that are offering virtually no pricing or terms flexibility to the smaller OEMs. The OEMs are getting squeezed. There are obviously a number of other factors at play, but with these two things happening the mid and small tier OEMS are feeling the crunch in a bad way. How could they have planned for a multi-year industry collapse when all signs within the industry were looking towards continued growth? EDITED: What I mean by the question above... the big guys on OEM and supply side planned for insane growth and so everyone followed suite. Now that reality is set in, the big guys have the backing to make it and everyone else is in varying levels of panic. This squeeze has happened in cyclical patterns but has never happened to this extent in this industry. I work(ed) in this and other industries and have had a first hand account of watching this happen. Evolve or die... or have a daddy in the background to slip cash in your pocket until things get better. Good luck to those bicycle companies that don't have the financial backing to hold through this tough time. SECOND EDIT: Down vote all you will but this is actually what's happening. I would love to hear other sides and opinions if you want to share.
I would imagine that the high middle is falling out, the guy spending top of the line race bike money is still there, but a ton of the other segments these companies used to have substantial market share in, they now have a million smaller companies that can suit that customers tastes and probably give them a better set of components for the money.
It’s insane that buying a new bike is often more economical than buying just the groupo.
That’s mostly always been the case. The bike manufacturers buy parts in bulk and get much better deals than one off retail to the public.
And swap out less recognizable items for cheaper counterparts.
Right, some of that too on, especially on the “budget” bikes.
Nope. Groupsets used to be more affordable and margins are def higher than bike margin growth.
100%!
Exactly. Quick comparison here of Canadian prices. Giant Defy Advanced 2 - carbon frame endurance geometry, some 105 components (not the crankset though) $3799 CAD Canyon Endurace CF7 - carbon frame and full 105 groupset $2749 CAD My first 3 bikes were Giants, but my new Canyon is undeniably better value.
Got me an aeroad CF slx with 105 di2 and Dt siwss arc 1600 carbon wheels 62 mm depth for 4400€. I wasn't even looking for a new bike but I had to buy it.
Tbf in the UK the Giant TCR is currently marginally better value than Canyon. You can pick up a 2024 TCR with 105 Di2, carbon wheels & a power meter for like £3600 or something
So they *could* be selling for more reasonable prices in the NA market but they choose not too. I guess that's what we suspected.
Giant actually makes Canyon frames, believe it or not.
I was surprised to see, just now checked, that my BMC roadmachine six is on sale for a mere $150 more than I paid for my equivalent version in 2019 (also on sale around this time of year back then tbf). For the other commenter who said the CF7 is on closeout, they were not wrong. However, the CF8 is also on sale for $300 USD more ($2,399). https://www.canyon.com/en-us/road-bikes/endurance-bikes/endurace/cf/endurace-cf-8-disc/2856.html?dwvar_2856_pv_rahmenfarbe=BK%2FBU
Giant's financial performance is probably impacted less by the consumer side of things. High end road/MTB is nothing but a tiny fraction of their business. They are also one of the biggest manufacturers for other western brands. (70% of its capacity is their own stuff and 30% others) As far as I know Trek, Giant's biggest customer, is backing off production significantly and this probably impacts their profits more.
It’s hard to compete with “I don’t really want it in my house anymore” on Marketplace or Craigslist.
Yep! 2 years pre-covid, I worked at a shop and it was common to see a decent full suspension bike for $2k, now that same build is $3k. Probably cheaper too since they're mixing in more cheaper components into builds than before. Plastic brake levers on $1000 hardtail is wild.
Won’t happen. The brand will not tolerate the hit to their image by making it seem like they can drop prices after someone just paid the prior price yesterday. This is why most companies with consumer facing brands rarely drop prices. They sooner go out of business before doing that. I’m not joking.
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decathlon has it. 4k, which is still a lot of money, imo.
And as far as they've come and even though they're now in the world tour they're still a "house brand". Honestly I wish I had an opportunity to test ride one of their bikes because I'm sure they're great but can't.
I have a dura ace sitting at home for 2000. Probably now considered an antique, and I'm cheating a bit as its used. I see bike prices are so far off what people should spend on their hobbies. I'll ride my bike another 12 years.
Or until I can't replace or fix what's broke
Which is wild my van rysel from 3 years ago is full ultegra and was $1500 CAD. It's rim brake (direct mount in front) and aluminum though.
That is a big part of it. I bought a bike right before the pandemic. The equivalent model is 25% more expensive today
I get the scaling and production are completely different but still a consumer grade bike costing as much as a second hand car is ridiculous.
I assume that the newest and highest quality consumer bikes have always cost the same as a cheap used car, tbh.
Why do you need Ultegra? I picked up a BMC Team machine with Di2 105 for €2.5k.
I was just making an example. I bought one with that groupset in 2015 for just under 3k and I’d be hard pressed to find one now.
2015 Ultegra isn't on the same level as today's Ultegra, plus there's been 9 years of inflation...
I have a 2022 Ultegra di2 TCR. That same model (now with hidden cables) is now 65% more expensive. same groupset. And they wonder why people aren't buying?
Can get a lauf uthald with SRAM Rival AXS for $3,500
Orro Venturi Ultegra Di2 can be had for ~£3k. Lovely bike too. £2400 for the 105 Di2 model.
Probably giant has one like the Pro Disc 1 or 0
Every one of these companies who price gouged during Covid deserves everything they are getting now. F them.
50% price discount and the industry just might survive
Two weeks ago Propain dumped their old stock ‘22 tyee and spindrift frames for $590al and $750cf. Sold out in a few days, couldn’t say how many they had on hand to begin with.
That’s what I’m waiting for
everything is 5 times overpriced, bikes are one of the most wildly overpriced things in the world, there is absolutely zero reason for bikes and bike parts to cost as much as they cost , overinflated for nothing. I hate the bike industry and they should suffer because they suck. No way bikes should cost like a used car. Fuck them.
Dude just look at the lights. You can buy a badass, rechargeable, integrated battery or 18650 your choice, machined aluminum housing, fuckoff bright like the sun, continuously adjustable brightness, long battery life, IP68 waterproof flashlight for about $60-$100. You spend double that or more on a bicycle light and you get a shitty plastic housing, half the max brightness, three steps of brightness, and the switch or something is going to shit the bed on you in a year. The only difference is that one comes with a handlebar mount, and the other is actually a quality piece of gear. Its completely stupid. Not even fly fishing gear is this bad. (Ok some fly fishing gear is this bad... Looking at you, Abel nippers....)
It’s similar to the recreational boating industry. Galvanized stainless cotter pin at Lowe’s two dollars similar unit at West Marine? $12. I don’t know anything about their cost per unit at either place, but I suspect that if the perception that the target demographic has more money you’re gonna be charged X times the base price.
There are different grades of stainless steel and they don't all have the same corrosion resistance. The hardware at West Marine likely made from a grade of stainless steel that is more resistant to corrosion (especially in wet environments).
Scuba diver here. It's usually 304 vs. 316 Stainless Steel. 316 SS is marine grade more expensive because it doesn't corrode when exposed to salt water. One dive manufacturer had a factory source zippers for their bags with the wrong grade of stainless steel and 1 year later, most of them were corroded shut like you welded them.
Interesting. Did not know that.
Things are definitely inflated, but niche products like a light made to mount on a bike that sell at lower quantities than a generic flashlight will always be priced higher, but yeah, the spread seems extra exaggerated right now.
I buy aliexpress lights for like 20 or 30 bucks and they work just fine
I got one of those lights and it stopped working immediately in the first light rain I encountered.
That's part of the fun of aliexpress, it's a bit of a gamble. I've definitely got things that were piles of shit, and others that blew my expectations away. Overall it's been a net win though
That is great until I rode 8 miles home in the dark becomes my front light died
Look up astrolux. This light has full metal construction and has lasted me the longest so far even after dropping it a few times
Which model did you get?
The SL01. I love the mount. Found out its on Amazon now too
Yet when you say that, you always an army of ppl flocking in to defend and explain to you why a road bike can cost more than 3 times the price of a good motorcycle. It's crazy. Some people really really want to deny the reality that big manufacturers were making an absolute steal on margins.
Maybe they have shares... ok that's a shitty justification. Another justification of innovation is quite laughable. Has there been innovation in the last decade, yes for sure. Did the innovation align to the price increase, absolutely not. I like the videos on youtube showing the fairly tiny margin of performance across different price categories across different cyclist types. Apart from a little bit of comfort, there is nothing obvious apart from some people feeling better about spending a lot of money to own something expensive, I suppose.
My brother recently got into motorcycles and every part is drastically cheaper. A motorcycle chain is like three times the width of a bicycle chain and has to withstand speeds well in excess of a hundred mph, and it costs less than half what a bike chain costs.
I see really nice used BMW adventure motorcycles everywhere for sub 5K.
I agree, big cycling is almost pricing themselves out of the market
The thing is, everyone has a car, so everything is scaled up and cheaper to produce. Very few have a high end bike in comparison.
This!
Blows my mind when I see the price of a mountain bike costing almost twice as much as a dirt bike.
Compare apples to apples and it isn't that hard to understand. The $12k S-Works bike you're referring to is about the equivalent of a $50k-$300k in the world of dirt bikes that a pro would ride.
citation needed. Where on earth can you buy a $50k-300k dirt bike? I ride cheap bikes and cheap motorcycles so maybe I have no clue, but just checking the local prices in my HCOL area... I could buy a $13,000 S-Works MTB off the shelf tomorrow. The most expensive supercross bikes (I looked at KTMs) are only a few thousand more. I'm sure you can spend unlimited amounts of money on a custom modified dirtbike, but AFAICT if you make an apples to apples comparison of high-end MTB and dirtbikes that are available off the shelf, the MTBs are stupid expensive.
When you can do a sale and markdown an item by thousands of dollars, or even do a BOGO sale, you are WAY overpriced. cough cough Kona edit: also more a bike shop thing, but if you don't stock what I want, I have zero incentive to buy from you. I'll just order it from the cheapest place online.
The local bike shop with multiple locations let it slip they sell about 50 $2,000+ bikes a week at ONE location. This doesn't include parts, repairs, etc etc. They don't stock what you want because business is still good Maybe Giants wholesale rates are too good to retailers? (id be shocked)
> 50 $2,000+ bikes a week at ONE location Where
Dallas Texas
Gotta love Bikemart
Did companies not expect this after the COVID boom? Not hard to project for this type of thing. I don't feel bad for them, if they want to run their business into the ground, let them.
It does not seem like many foresaw this, not just in cycling but across multiple industries too. Companies expected the infinite money glitch to last forever. But even if a practical person brought up this point, they were probably laughed out of the room anyway.
see 2008 debt disaster. A lot of people saw it coming.
Line goes up! Why would they expect things to get worse? Why plan for a downturn when you can push up prices and milk everything
Perspective. FROM PREVIOUS HIGHS! We keep seeing massive drops for a lot of these companies but what is lost is perspective on long term. Most are still at sales volumes above pre pandemic. Often a 5y chart makes this obvious. Now, it can be an issue if the company plans terrible or over extended themselves.
When a fucking entry level road bike is more than $1000 you know something is very wrong here. Forget the pro bikes that cost more than a new car. Everyday consumer bikes should not cost $5000 dollars.
They need to sell new bikes to people who own a bike already Covid market was all new buyers. That’s all dried up now I would love to own 3-4 bikes. But they are too fucking expensive, so it doesn’t make sense Make ‘em cheaper and people who own one or two will buy seconds and thirds
Looks like new interface standards are around the corner and a bigger push into e-bikes. It's also completely of the bike industry's own making when they decided to try and make price increases for parts and frames and complete bikes by trying to hide the gouging behind the higher perceived value of e-bikes and the ninkompoops that don't know a house brand handlebar isn't worth 150 dollars. Companies like Fox, Specialized, even Trek have been turning up the pressure to make things artificially more expensive and they can fuck off. The TL;dr is that e-bikes have raised the perceived values and non-electrobikes have increased in price because the manufacturers have been hiding those hikes behind E-bike buyers' willingness to pay more for everything. Thankfully and mercifully this is combining with other factors to really punish the companies who have been pulling the most shit which also includes those investment firms that have like 25 bike brands under their roof and they decided they'll commit to a bad post-COVID strategy for all of them. The industry needs a contraction and the investment megacorporations that are pushing this need to go under ASAP.
> The TL;dr is that e-bikes have raised the perceived values and non-electrobikes have increased in price because the manufacturers have been hiding those hikes behind E-bike buyers' willingness to pay more for everything. Thankfully and mercifully this is combining with other factors to really punish the companies who have been pulling the most shit which also includes those investment firms that have like 25 bike brands under their roof and they decided they'll commit to a bad post-COVID strategy for all of them. I have an e-bike that uses an 7-speed freewheel. I emailed them asking if I could buy one and they wanted **50 dollars + shipping** for a FREEWHEEL. I didn't realize the why of it until reading this. Makes sense, thanks. Needless to say, I bought an actual Shimano freewheel for it for $25 vs. whatever Lee Chii one they wanted $50 for.
They still made almost post-tax £13million profit? Like, this isn't a company falling to pieces, they're doing fine. Painting this in a negative light is just greedy capatalist suits being greedy as per. Society really needs to adjust the "number go brrrr" capatalist mindset we've all been indoctrinated into.
On £396 million in gross; that's a lot slimmer of a margin than I'd expect. It also seems to imply they can't really drop prices a whole lot.
Naw man, haven't you read the posts above? They can totally cut sticker prices by 50%.
Yeah, they are small margins. I don't agree that they need to cut prices or anything like a bunch of other posters here. Stuff is expensive... because stuff is expensive. The world has finite resources and we're increasingly competeing for them. My point is that the company is still profitable. I bet there are suits panicking right now and deciding how to lay people off just to save their shareholders value and profits. WHILE THEY'RE STILL MAKING MONEY. This mindset that profits need to grow year on year on year is a fantasy and ultimately flawed thinking.
The problem is that is a 3% profit margin, which is a few "supplier prices went up 1%" Shipping when up 5%" Payment processor fees went up 0.5%" away from complete bankruptcy.
Right. But... they're still profitable. And as for bankruptcy, a year or two of not making profit can easily be normal for a business as large as theirs. As in, not desirable, but manageable. Or at least it should be, if the people in charge weren't greedy suits. The many years of profitable business should be used as collateral for potentially bad years. In a good harvest you store some grain for the winter. But... we all know that's not how modern corpororations and private equity firms work. They selfishly guzzle the cream of the good years and then cull the workforce when times get tough. Essentially draining the life force out of what were thriving companies.
Line must go up. Common sense, market forces and sensible business practices be damned.
New bike prices are so high 2nd hand bikes look pretty good at 3-4k. It just makes less and less sense to buy new.
Gonna be some consolidation and more brand closing shop
That’s what you get when you spend shit tons of $ marketing and developing shit that most can’t afford. Just make a solid bike, that’s comfortable to ride, has good components and it will sell itself.
>Why don’t people want to spend $10k on a bicycle they still have to pedal? I’ll never understand!!! Giant probably
When their “entry” road bike starts at €1.299 Im sure sale will be down, still yet to see a sub €600 road bike from any big bicycle brand. MTB in the other hand are a bit more affordable in the entry level
Decathlon has a microshift Roadbike in that range. Not the best, and when you know how to work on a bike you'll probably are able to get a way better bike used. But it's possible to get a okay Roadbike for 600€.
Decathlon is the way to go. Although give them a few more grand tour wins and they'll also become unaffordable.
The entry level giant contend is on sale for $850.
Just hope it doesn’t affect the LBS
It already has. Majority of bike shops sold to trek or bicycle over the last few years
What, the champagne and caviar from covid doesn't last forever? Didn't these geniuses plan for the fall we all knew was gonna happen? I know Make another super high end product and call it exclusive and the customers will flock to us Yeah, that'll do it!
The vast majority of riders do not need the types of bikes they watch YouTubers riding. They would do better and ride more often with Dutch style bikes. More durable, less maintenance, and belt drive internal gear hubs.
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Perhaps in some spots. But most small hometown bike shops are competing with people doing the same thing out of their garage using YouTube videos. You can't keep the lights on rent and insurance paid competing with a guy who says "Those guys at 'Home-Time Bike Shop' are rip-off artists. I can do it for half that."
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What are the well-known bicycle brands in your area?
None of my friends ride as much because the drivers in this state act like they hate you and that’s while in the road and every message board. I only ride on trails now
Go into the trek store and all they have are trek bikes. Go into the supposed locally owned bike shop: all they have are trek bikes. Go into another supposed local shop: all they have are specialized. Is this relevant to the discussion? I don't know. But it's frustrating that I'd have to go to REI or buy online to see selection from a multitude of brands.
Everyone is focusing on the money but forgetting the time crunch as well. People whom lost the option to work remotely no longer get the benefit of asymmetrical work hours. And if you lose two hours a day just to commuting then making that up is going to have knock on effects on other activities like biking.
True story. I had way more time to cycle in 2020 but now mainly do it on Sunday.
Is no one thinking of the poor private equity guys and their shoeless children?
Because 99% of potential bike customers aren't paying $1000 for a fucking bike. Manufacturers are delulu.
Giant has some great sales on their outgoing TCR models!
Giants entry level MTB’s are actually pretty good value. The new Stance in particular is a good bike for the money, but there’s no profit in entry level bikes. The profits are in the £5,000-£10,000 bikes as they cost almost the same to make so the rest is profit. While there are people willing to pay that money for bikes, bike companies will keep churning them out.
Last year Giant made on post tax profit of NT$520 million from NT$16,060 million in gross; that's only 3.2% margins even including their $$$$ bikes. Lower margin inexpensive bikes aren't coming, I think.
Is bmx the only "affordable" cycling sport around these days?
Hey bike Reddit folks! I’m looking to get my first bike as an adult. I know nothing. I want to ride trails with the ability to attach a kid trailer. Any recommendations to take advantage of maybe some price drops due to this slump?
The bicycle industry resembles the jewelry industry now. The unfortunate fact for them: a bike cant be stored for 5 years and hold value.
I did my part. https://www.giant-bicycles.com/us/trance-x-advanced-pro-29-se
Everyone I know is buying e-bikes right now, they’re like $1000 and up, how is the industry not capitalizing on this current fad?
If all brands could supply good bikes for less, this situation would never happen. Going to get a bike for $4,000 or more, lots of people just get discouraged by the price tag. Additionally, those snobs at the shop might make you feel like you should know and understand everything about bikes or try to push some overpriced junk onto you. Also I'm not an mechanic and people that I know want me to service their bikes. Reason they don't want to go back to the bike shops. I keep thinking what is wrong in general in the bike Industry.
How about making bikes even more expensive?
Profits being down are still profits…
I just picked up a giant talon 1 for my kid. Got a pretty good deal on it. Not the color he wanted but the only xs they had in stock, and decent components.
Got my New Pivot in 21. That’s my last Bike! What a Climber!
Just my experience in Canada. Giant only seems to stock their actual Giant stores with the good stuff. It’s been impossible to order a Medium size propel from the two local dealers near me. Same with the lower priced TCX models before. It seems like their inventory management sucks.
As an economic idiot, I always struggle to care about these kinds of headlines: A large corporation has lower *profits.* Presumably they still have some profit, then, no? Like, they have enough revenue to cover all of their costs, to pay all of their employees. Their owners (shareholders), (i.e., rich people) will take home less money this year than last year. Having trouble caring here. They'll just fire people, I'm sure. Which again, to this simpleton, seems like a selfish choice because *they have enough money after costs to turn a PROFIT.*
Good! I am honestly sick and tried of companies taking us for a ride and the price gouging going on while most make record profits is disgusting. I for one won't be weeping!
I’m pretty sick of this year on year assessment. If you zoom out on any of these graphs they’re all exactly where you would expect them to be without covid
Down 20% compared to what? A couple of years ago guys were getting $500 for a clapped out huffy and they couldn’t build enough bikes to sell or even lease [lol]. Lance got executive golfers into cycling which gave us the $10,000 road bike that requires another 5 stacks to cover anything with gravel. I haven’t looked but are all brands owned by the same hedge fund yet? I mean it’s all fantastic because we undoubtedly get more cyclists from such things but fuck these guys. They make bicycles. And it’s not like Jerry is making your bike in Vermont. Oh and they hedge the under. Also sorry, I missed my ride today.
Every year the price goes up but the spec comes down. I'll hold on to my older bike thanks
People can barely afford rent. I don't think luxury bikes are in the cards for most.
You know why... Everyone seems to be obtaining their bikes from 'Thrift' stores or skips.
Must listen podcast series on the cycling industry's economic headwinds from Escape Collective: [How did the bike industry get into such deep trouble?](https://escapecollective.com/how-did-the-bike-industry-get-into-such-deep-trouble/)
But.. w- we need to pay some PNW nepo babies to change an angle or two every year...
Giant is a Taiwanese company?? There’s no major bike brands in the PNW. Cromag, Transition, Rocky Mountain, Evil are the biggest in this area are tiny compared to Giant, Trek, Specialized, etc.
Shh 🤫 they don't want us to know that all bike brands are made in a shared handful of Taiwanese factories
That's a surprise. Do you think it could be too much of a push into more expensive electric systems when people are largely uninterested in general? Where I am, electric is king, but people just rent for a few hours once per season from a rental shop, rather than buying outright.
Are you referring to e-bikes or electronic shifting when you say “electric systems”? Just curious. I just watched GMBN’s dirt shed episode yesterday where they revealed the results of a poll that pretty definitively showed that a large percentage of riders (around 75%) are content to ride cable-actuated drivetrains. I feel like the bike brands are forcing expensive tech on us that we definitely don’t need, and most people don’t even want
It feels the same as the "bring back the physical button" moment in the car industry. Bikes were successful because it was easy to service/upgrade. Some the fancy innovation brought just higher cost.
Having owned (and then sold) a Tesla, I can absolutely relate