12% price increases coming for many bikes - if you can even find one

Looks like quite a price jump coming for many brands. And that’s if you can even find new bikes right now. Most of our local bike shops are sold out and being told March 2021 for earliest new stock. Thankful my new hardtail just arrived :slight_smile:

3 Likes

The argument doesn’t stack up to scrutiny for price increases. Manufacturers are simply taking advantage of the market.

Why would you release a bike (SL7) in the late summer only to increase the selling price a few months later?

Having sold all your stock would suggest the market can withstand increased selling prices rather than the suggested complexities of supply chains. Another classic mis direction is from the Big S suggestion that the local bike shops determine the selling price.

I can’t see the second hand residual values faring too well and the short term profiteering will come back and bite the big brands as the current demand isn’t sustainable.

That said there should be a lot of nearly new bikes floating around for sale on eBay or Facebook at a fraction of the new price.

13 Likes

If this is happening then I am done with specialized. Ive tried contacting them and the first attempt timed out after 5 months and they sent me a 10% off coupon on there online store. Then after trying again they got back to me but passed the buck. I mean if they are so short staffed that they cant reply to an inquiry for 5 months than they have definitely cut costs and are running quite lean. You cant phone them for support… In my mind this is just covid profiteering.

Ive got a diverge, roubaix and a stumpjumper. Ive been very dedicated to the brand but over the years they have proven to be less than supportive to the community in my opinion.

This combined with the cafe roubaix specialized lawsuit from a few years back and I have had enough. The Canadian distributor is also hell to deal with according to any of the bike shops I have talked to. They much prefer dealing with Trek and Giant. or almost any other company for that matter!

2 Likes

ah cool the sl7 wasn’t expensive enough

6 Likes

Seen the increases on Canyon’s website. While it’s not fun, don’t see why people are mad. Isn’t this basically the way for-profit companies work, increasing cost when there is high demand and scarcity in supply?

2 Likes

There is a fine line between making a profit (cool) and profiteering (not cool).

But companies all over the world are using Covid as an excuse for all sorts of business practices that are transparently aimed at reducing costs/increasing margins.

A great example is high street banks here in the UK. For whatever reason, UK customers have never accepted paying for a current account (though that’s common practice elsewhere). Having tried and failed to make that business model work here, the banks have gradually but systematically reduced branch numbers and opening hours. Now with Covid, multiple branches are being closed, and others having their opening hours reduced to 1000-1500 ‘for your safety’.

That is transparently nonsense (as they will now concentrate a similar number of customers in fewer branches and a shorter space of time).

It also seems forgotten that manufacturers have sold an unprecedented number of bikes this year. Where did the money go? :thinking:

3 Likes

Child bikes are not immune to this.
Im looking to get my oldest daughter a liv ALIGHT 24 (Giant).
The only difference between MY19, MY20 and MY21 is the color (Teal, White, Purple), but the MY21 is $60 more expensive, for no known reason.
I was able to find the boys version of the bike in stock. It was a MY20. The dealer was asking $60 more than retail for it.
If i dont get it, i will probably need to wait, and risk not having the xmas gift.

Bike companies are taking an incredibly short sighted approach to things right now, extrapolating short term supply shortages and demand increases due to COVID lockdowns, into what they believe is a long term market that can bear increased prices.

Did no one tell these guys that the world economy is going through a massive contraction and that 2021-2023 is expected to have some of the highest global unemployment since the 1920’s?
Summer 2020 was weird AF. We all got locked down and a bunch of free time (to ride bikes and make sourdough) due to COVID. Even if people were furloughed we have had a decade of near record economic growth in most markets so people were feeling willing to spend, and buy bikes so they had something to do.
Fast forward to spring 2021, things are not going to be rosy. Unemployment is very real, shuttering businesses is occurring, are people really going to be dishing out for brand new bikes again? Especially high end ones?

7 Likes

Agreed. The Cafe Roubaix bullying fiasco marked the end for me too.

1 Like

I don’t see the problem. There is high demand, prices go up. If you don’t like it, you do t but it. That’s how capitalism works. When demand goes down, prices will come down. If I owned a company, I would do the same thing. In fact everyone is doing it. Interest rates are low, people are buying houses, so everyone is increasing their asking prices. It’s fair game.

7 Likes

As a short term - yes. But when comes to houses it is a little bit different as there is no aspect of loyalty. Brands can easily loose returning customers with this policy. And there is also aspect of simple greed and size. If your local LBS or favourite restaurant rises prices it is easier to accept this as you have the feeling of helping someone that is in a hard situation, bike manufacturers are not. They behave like pharmaceutical companies (and there is not many fans of them;)). Of course we are looking at this from the perspective of expensive bikes and these companies live from cheap bikes sales, as hi-end bikes are only small percentage of their revenues.

2 Likes

I’m pretty sure they have done their market analysis.

I actually don’t do business much with the LBS because I always feel they are robbing me. They charge too much for parts and labor and they take forever. I buy on the web and do my own work. If I can’t do something then I accept their prices in exchange for their expertise. I feel the same way with all businesses. I don’t mix charity with business.

6 Likes

Well, that’s how economic theory works, true. But there’s a bit more to running a successful business than that. No consumer, current or prospective, wants to feel ripped off. Whether they actually are being ripped off is almost irrelevant: the perception of a brand/shop/seller is important. People spends lots of time building reputations, and lots of money creating an image. To me, damaging that, in order to exploit short term market conditions, is fairly short-sighted.

8 Likes

If people are willing to pay, they will charge accordingly. Also, I’m sure they aren’t selling as many bikes as before and need to make up for lost profits somehow. Personally not going to get triggered or bent out of shape over it, capitalism is not a hard concept to grasp after all

  • Based on what info?

  • My take is the exact opposite, that they are selling nearly everything they can provide, especially in the $500-$2000 range, but that has pushed up the price range as the lower level models remain scarce.

4 Likes

I should have phrased it as delivering. And depending on how they report revenue a sale and a delivery is not the same thing. So yes, they may be out of stock and back ordered but it doesn’t mean those funds are going to hit their books right away.

Combine that with the production delays, and I’m sure the amount of bikes they will have delivered by end of the year is going to fall short of projections.

Most shops sold their entire stock of 2020 bikes, except the really high end ones, by July. This has been a record sales year. I keep going back to the same idea: where did the money go?

3 Likes

Practical example: when I sold furniture we always had a big sales boom around holiday time. Most of those orders took 8-10 weeks to be produced and we did not get credit for them on the store’s P&L until delivery which would fall into the following year, so even though we had extra staff working during this time, the net profit went down because there weren’t enough delivered sales at this time to cover the expenses

It’s fairly standard practice not to book revenue as revenue until delivery of product occurs, Enron showed us why (booked services they were hired for before they were completed and inflated their numbers, many of those contracts were subsequently cancelled).

I’m genuinely curious as to where this sentiment comes from?

Where did the money go? Into the pockets of the employees and owners of the companies that had record setting sales? I’m still wondering where the problem lies here.

1 Like