Bicycle Retailer

Bicycle Retailer Latest News and Information

22 May 2019

  • United City Bikes attracts deluge of pledges for folding e-bikes
    At 27.5 pounds, The One's three models have raised more than $770,000 through Indiegogo.

    ZURICH (BRAIN) — United City Bikes saw the need for a lightweight folding e-bike in the ever-growing electric urban universe, but the response to its solution, The One, even caught the company by surprise.

    After a year-and-half of research and development, the Swiss startup launched its three 16-inch wheel models, each weighing 27.5 pounds, on crowdfunding platform Indiegogo in April. According to United City Bikes, more than $100,000 was collected in less than an hour. As of Tuesday, 10 days from the end of the campaign, more than 800 backers have contributed nearly $770,000. United City Bikes’ goal was $50,000.

    “We knew there was a big interest in a real lightweight urban mobility folding bike,” said Ralf Miller, United City Bikes customer relationship manager for sales. “But, finally, it was still overwhelming to see the great success of the crowdfunding campaign. Our plan from the beginning was to reach $1 million in sales. We are right on track to achieve this goal.”

    Preorders are accepted through Indiegogo until May 31. The first 100 bikes were sold for $699; early-bird pricing is in effect now for the U1 ($799), U2 ($899) and U3 ($999), half the MSRP prices. The bikes will be delivered to backers this summer, the company said.

    “We want to make urban mobility affordable for everyone,” Miller said. “Our plan was to integrate only state-of-the-art technology and elements to one single and unique electric folding bike with no compromise. It comes with a unique design and it should be your indispensable companion in any living conditions.”

    Folding e-bikes easily can weigh more than 50 pounds. The One achieves its light weight chiefly from a magnesium alloy frame, a custom-built 250-watt motor that weighs 4.4 pounds and a single-sided fork. The bikes fold to a thickness of 10 inches. United City Bikes claims they can be folded in less than 10 seconds to a size of 31x25 inches.

    Price points are determined by battery capacity and disc brake systems. The U1 has a 5.4Ah lithium battery (24.8-mile range) and generic mechanical disc brakes; the U2 has a Samsung 7Ah lithium battery (32.3 miles) and Shimano mechanical disc brakes; the U3 has a Panasonic 8Ah lithium battery (37.2 miles) and Shimano hydraulic disc brakes.

    The battery on all models is integrated into the seatpost, which is removed for access. The battery can be charged on the bike or removed to charge anywhere without carrying the bike.

    Miller said United City Bikes will begin building an IBD network later this year, and is putting a sales team in place. Online sales will be handled through itswebsite. He said he expects sales of 5,000 units this year. Marketing will focus on social media.

    The bikes were designed in Switzerland and Germany, with parts coming from China, and assembly in Europe and Taiwan.

  • Industry showed some sale growth in April, latest BPSA figures reveal

    BOULDER, Colo. (BRAIN) — After a dismal first quarter, the U.S. industry turned a corner in April according to new wholesale bike sale figures released by the Bicycle Product Suppliers Association on Tuesday. Improved weather conditions in many regions probably contributed to the budding sales growth as the second quarter began.

    The BPSA's Sell-in Reports for April showed wholesale bike sales were up 16.9% in dollars and 2.7% in units. While not spectacular growth, it's an improvement on last month's report, which showed a decline in unit sales and only a 0.7% growth in dollars sales, contributing to a 20% decline in unit sales in the first three months of the year. 

    The report, compiled by The NPD Group for the BPSA, shows wholesale sales by participating association members to retailers, including IBDs and others. Because the report tracks wholesale sales, some of the timing is determined by preseason order deliveries and not directly tied to sales demand at retail. 

    In April, the trends for categories continued most recent trends:

    • Mountain bikes, the single largest bike category, were relatively stable: up 1.1% in units, down 3.3% in dollars. Within the mountain bike category, the shift from 27.5-inch full-suspension to 29-inch continued, but 29er full-suspension bikes, while still the most popular subcategory, showed some softness — sales were down 11% in dollars and 7% in units in April. That subcategory's monthly results may have been a bit of a correction, however, as year-to-date sales were up over 30% in units and dollars. 
    • Road bikes, the second largest bike category, were up significantly in the month — 30% in dollars, 7% in units. Most of the growth was for cyclocross and "other" road bikes, which includes gravel bikes. Sales of performance men's road bikes were flat, while sales of triathlon bikes and sport road bikes for men and women were down.
    • E-bike sales were up 90% in dollars and 58% in units for the month. BPSA members reported e-bike sales of $19.1 million in the month, accounting for 14.4% of all sales in the month. Year to date, e-bikes account for 15.6% of wholesale sales.
    • BMX sales were down 4% in dollars and 22% in units.
    • Comfort bikes were up 5% in dollars and down 10% in units.
    • Cross/hybrid bike sales were up 11% in dollars, down 2% in units.
    • Youth bikes were up 16% in dollars, and up 9% in units.

    On the inventory side of the report, overall supplier bike inventory at the end of April was 661,293 bikes, down 11% from the inventory level on the same date last year. The bikes in inventory were higher dollar, however: the dollar value of the inventory was up 8%, to $295.1 million.

    The bike subcategory with the highest inventory growth was the 29-inch full suspension, where the inventory was up 127% in dollars. E-bike inventory was up 23% in dollar value.

  • Giant Manufacturing Q1 sales up 5%

    TAICHUNG, Taiwan (BRAIN) — Giant Manufacturing registered first quarter sales of NT$14.69 billion ($467 million), up 5.2% compared to 2018's first quarter.

    The company said strong demand for e-bikes and a rebound in sales in China, as well as favorable exchange rates, helped improve margin to 21%. Earnings per share were NT$1.82.

    The company said Giant Europe outperformed its other regions with double-digit growth that was mainly driven by e-bikes with sales growth exceeding 60% over last year. U.S. market performance grew slightly. Giant China sales began a rebound in the fourth quarter last year and saw low single-digit growth in the first quarter this year. The company said China's "bike-sharing fever" is fading away. 

    Looking into 2019, Giant said the overall global economy and market situations pose many uncertainties due to the trade war between U.S. and China.

    "In managing the current market uncertainties, Giant has developed strategies to enhance production automation and utilize its manufacturing facilities in both Asia as well as Europe to stabilize supply, improve lead time and (add) product value to aid its growth momentum," the company said.

  • Business returns to normal for Sidi distributor after plane hits warehouse

    RIVERSIDE, Calif. (BRAIN) — The U.S. distributor for cycling shoe company Sidi resumed operations Monday after an F-16 fighter jet crashed into a section of its warehouse four days earlier.

    Ciclista America said after the afternoon crash, in which 12 people suffered minor injuries and the pilot ejected and later was taken to a hospital, it would suspend shipping on May 16-17.

    "But we are up and well now," said Ciclista America's president Bill Berroth on Monday. "More scary than anything else."

    Berroth said no inventory was destroyed in the crash, and the staff was evacuated as a precaution. The warehouse is more than 250,000 square feet, and the jet hit another unit on the other side of the structure, Berroth said.

    The pilot was on a training exercise from the March Air Reserve Base when the accident occurred, according to KTTV-TV. Base officials told the station the plane might have experienced hydraulic failure.

  • Specialized Bicycle announces US leadership changes

    MORGAN HILL, Calif. (BRAIN) — Specialized Bicycle Components announced several U.S. leadership team moves in a communication to retailers Thursday.

    • Jeff McGuane, general manager for the past 3 1/2 years, will leave Specialized on May 24 to accept the CEO position with Fox Racing. McGuane helped execute global and USA sales strategy while leading the U.S. team.
    • Sam Benedict, general manager of U.S. mountain biking, will lead Marketing and Demand Creation. A 12-year Specialized employee, Benedict will have an increased focus on rider conversion from field and digital tactics. He will head all lead generation, promotions, communications, events, athletes and ambassadors within the U.S. marketing team.
    • Brandon Hemmig, inside sales manager, will lead Customer Experience. Hemmig has been with Specialized for 10 years. He will continue to work with the Rider Care and Inside Market Development team.
    • Colin Daw, regional director of market development, will lead Category and Business Development. Daw has had two stints at Specialized, totaling a little more than four years. Daw will head category teams across Turbo, Road, Mountain Bike, Active and Equipment along with Business Development and Sales Operations. 
    • Demany Smith, senior strategic accounts manager, will lead Market Development. He has been with the company a little over a year. He will supervise the regional directors of the Market Development team. 
    • Charles Bisaillon, global sales operations manager, will become Market Leader. Bisaillon has helped in the development and implementation of Specialized's integrated marketplace execution. He will be the interim leader of the U.S. team.
  • Eurobike 2020 set for early September

    FRIEDRICHSHAFEN, Germany (BRAIN) — After experimenting with July dates in 2018, organizers of the Eurobike show have set the dates for their 2020 show for Sept. 2-5, roughly the same time slot as this year's Sept. 4-7 show. 

    Eurobike 2020 will be open exclusively to trade visitors for the first three days (Sept. 2-4) and open to the public for Festival Day on day four (Sept. 5). The 2019 show follows the same format of three trade-only days followed by a public day.

    "We're delighted to have already fixed the dates for 2020. It's in the interest of all partners to set the date well in advance for better long-term planning and to ensure that the Eurobike is the seasonal high point that all participants want it to be. The depth of the offer at Lake Constance is unique worldwide. The show reflects new trends and developments in the classic bike and e-bike sectors. In addition, there are product innovations and new players from the micromobility industry, which show that these alternative mobility solutions are not only more sustainable, but also often more effective," said Messe Friedrichshafen's CEO, Klaus Wellmann, and Eurobike head Stefan Reisinger in a joint statement.

    Dates for the 2020 Eurobike Media Days and Urban Mobility Media Days also remain roughly the same as 2019.

    Eurobike events for 2019-2020:

    • July 2-4, 2019: Eurobike Media Days at Kronplatz, South Tyrol
    • July 10-11, 2019: Urban Mobility Media Days by Eurobike in Frankfurt
    • Sept. 4-7, 2019: Eurobike in Friedrichshafen
    • Oct. 3-5, 2019: ASEANBIKE in Bangkok, Thailand
    • April 18-19, 2020: VELOBerlin in Berlin
    • June/July 2020: Eurobike Media Days and Urban Mobility Media Days
    • Sept. 2-5, 2020: Eurobike in Friedrichshafen

    More information: eurobike-show.com.

  • What we imported from China last year

    WASHINGTON (BRAIN) — Last year, the U.S. imported well over $1 billion worth of bike products, not counting some items that can't be specifically accounted for in U.S. Commerce import figures. Many of these items are now subject to a new 25% tariff in addition to prior tariffs, or will become subject to new tariffs if the Trump administration's latest "List 4" tariff proposal is enacted.

    BRAIN counts $1.1 billion in imports of complete bikes, frames and forks, wheels and wheel parts, hubs, saddles, pedals, and others parts including shifters, derailleurs, and aluminum stems.

    Import stats for many bike products are unavailable because they are lumped in with other items under a single Harmonized Tariff Schedule import code. Bike helmets, for example, are included under two HTS codes that also include other "athletic, recreational and sporting headgear."

    The U.S. imported $112 million of products meeting that description last year, from China. But there's no way of telling how many were bike helmets. E-bikes are also not included; they are counted under the same code as electric motorcycles and other electric cycles. Most tools, baskets and bags, shoes and cycling apparel are also not included in our $1.1 billion figure for the same reason. 

    If you count bikes instead of dollars, 95% of imports came from China last year. 

    The total value of all global imports of the products we counted was $2.2 billion last year, meaning that Chinese imports accounted for exactly half of bike-related imports last year in those categories. If you count bikes instead of dollars, 95% of bike imports came from China last year. 

    Here's the value of Chinese imports by category last year:

    • Kids bikes: $190,415,075
    • 20-inch bikes: $138,545,856
    • 24-inch bikes: $82,315,990
    • Road bikes: $171,955,935
    • MTN/Comfort bikes: $374,454,805
    • Other bikes: $18,228,206
    • Frames, forks, and tubesets: $53,734,619
    • Wheels, rims and spokes: $13,068,805
    • Hubs: $4,899,131
    • Brakes: $3,210,825
    • Saddles: $6,431,953
    • Pedals and crank-gear: $3,294,141
    • Parts and accessories not otherwise specified: $41,050,351

    Total: $1,101,605,692

  • Tariff timeline: How we got here

    BOULDER, Colo. (BRAIN) — Tariff news is piling up on the industry, making heads swirl from Washington to Long Beach to Boulder.

    To help you, and us, keep track, we have prepared a timeline, below. We suspect we'll have to keep updating the timeline as things develop. We are also working on a FAQ-style article on tariff issues. If you have a question, shoot it over to BRAIN’s Steve Frothingham at Sfrothingham@bicycleretailer.com or leave a comment.

    Editor's note: We've corrected our reference to the import duty on bikes during the Kennedy administration. The correct figure is 30%, not 50% as we had said. Thanks to James Longhurst, Ph.D., an associate professor in the history department at the University of Wisconsin La Crosse for nicely pointing out our mistake. 

    Pre-existing tariffs

    During the Kennedy administration the import duty on bikes was 30%. But in recent years most complete bikes have been subject to an 11% tariff; the rate for most road bikes is half that. Before the new Section 301 tariff imposed last year (see below), e-bikes had no tariff.

    All the new and proposed tariffs in the news in the last year are in addition to the pre-existing tariffs.

    Parts and accessories are generally subject to tariffs between 0% and 10%. The tariff on pedals, for example, is 8%, while that on pumps is 3.7%. 

    All the new and proposed tariffs in the news in the last year are in addition to the pre-existing tariffs. So for example the new 25% tariff on Chinese bikes, made official this month, is on top of the 11% tariff most bikes already are subject to, for a total of 36%.

    Many missed the news last September, but there was a tariff reduction that month. President Donald Trump signed the Miscellaneous Tariff Bill Act of 2018, which reduced some of these underlying tariffs (in imports from all countries, not just China) without affecting the new Section 301 or Section 232 tariffs. For example, the bill lowered the rate on disc brakes from 10% to 7.5%, and the rate for unicycles went from 3.7% to 0%. It also slightly reduced the tariffs on some cycling shoes. There's more on the MTB on the PeopleForBikes website.

    New and proposed tariffs, in chronological order:


    The U.S. tariff on steel and aluminum

    Applies to: U.S. imports of raw steel and aluminum from most countries
    Rate: 25% on steel, 10% aluminum
    Date proposed: March 8, 2018
    Date applied: March 23, 2018
    Type of tariff: Section 232, related to national security. (There's more on Section 232 tariffs on the Department of Commerce site)

    Annual import value of products, 2018: $40 billion
    Notable exclusions: Steel from Argentina, Australia, Brazil, and South Korea (Argentina, Brazil and South Korea are limited by import quotas); aluminum from Argentina and Australia (Argentina limited by quota). Under NAFTA, Canadian and Mexican materials were exempt until May 31, 2018.
    Impact on our industry: Many U.S. manufacturers tell BRAIN that material costs — even for U.S. made steel and aluminum - have increased significantly. This put them at a disadvantage relative to foreign manufacturers, because only the materials, not completed products, are subject to this tariff. Some U.S. manufacturers favored an increase in tariffs on completed products because it helped reduce that disparity. 
    Status: Mexico and Canada continue to negotiate new trade agreements in hopes of eliminating the tariffs; with a Canada/US deal announced on May 17. The EU and the U.S. also continue to negotiate on this and other trade issues.
    Retaliation: Canada, Mexico, and the European Union each enacted retaliatory measures.

    Section 301, List 1 (GPS and bearings)

    Applies to: U.S. imports of a wide array of Chinese products, including GPS bike computers and ball bearings
    Rate: 25%
    Previous tariffs: GPS: 0%; Bearings: 4-10% depending on type.
    Date proposed: April 6, 2018
    Date enacted: July 6, 2018
    Type of tariff: Section 301 (More on Section 301 on the USTR website)
    Annual import value of all List 1 products, 2018: List 1 represented $34 billion in imports, out of an original proposal of $50 billion. List 2 (below) made up the $16 billion difference.

    Impact on our industry: Caused some GPS makers to move production out of China, usually to Taiwan. Raised costs of U.S.-made components that include Chinese-made bearings, and replacement bearings. Caused some bearing suppliers to move production or assembly out of China.
    Retaliation: China announced its own list of U.S. goods subject to new tariffs.
    Status: Still in place.

    Section 301, List 2 (Chinese e-bikes and motors)

    Applies to: An array of Chinese products, including e-bikes and e-bike motors.
    Tariff rate: 25%
    Previous tariff on e-bikes: 0%
    Type of tariff: Section 301
    Annual import value of all List 2 products, 2018: $16 billion
    Date proposed: June 20, 2018
    Date applied: Aug. 23, 2018

    Impact on our industry: Several manufacturers, including Trek and Pedego, testified against the proposal in Washington. The tariff had more effect on lower-priced e-bikes sold online and other channels. Sales statistics show the e-bike remained the fastest growing segment in the industry, despite the tariffs.
    Retaliation: China announced a second round of U.S. goods subject to retaliatory tariffs.
    Status: Still in place. Bike trade groups and brands requested exemptions, but the USTR denied those requests in January.

    Section 301, List 3 (Chinese bikes, parts and accessories)

    Applies to: Wide array of Chinese products, including most complete bikes and bike parts and accessories, plus other items the bike industry uses and sells, like tools and water bottles. 
    Notable exceptions: Helmets and lights were exempted for safety reasons. Cycling apparel and shoes also are not included. A variety of bike parts and accessories that are not elsewhere specified or included in the HTS import codes (NESOI, in importer jargon) fall under the 8714.99.8000 code. That code was NOT included in this round, but items under that code are subject to a pre-existing 10% duty. This includes about 40 types of products, including pump clips, bike radios and horns, kickstands, wide-angle reflectors, seatposts, toe clips, spoke reflectors and more. HTS 8714.99.8000 is included in List 4 (see below).
    Tariff rate: 10% starting September 2018, was set to increase to 25% on Jan. 1, 2019, but the increase was delayed. Now set to increase to 25% on imports that arrive after June 1.
    Previous tariffs: The 10% and 25% tariffs are in addition to existing tariffs on bike products, discussed above.
    Type of tariff: Section 301
    Annual import value of all products on List 3, 2018: $200 billion.
    Date proposed: July 17, 2018
    Date applied: 10% took effect Sept. 24, 2018. It increased to 25% on May 10, 2019, applying to imports that arrive after June 1.

    Despite the notable exceptions, this is a big, wide ranging list of bike stuff.

    Impact on our industry: Despite the notable exceptions mentioned above, this is a big, wide ranging list of bike stuff. Evidence: In 2018 the bike industry imported at least $1.1 billion in products on this list from China, representing half the industry’s imports. Since September, the 10% tariff has led to wholesale price increases of around 5% on these products, retailers said. Suppliers tell us efforts to re-source products and the uncertainty has been costly. The increase to 25% is expected to cause significant wholesale and retail price increases.
    Retaliation: China is running out of U.S. imports to hit with new tariffs in response. After the U.S.’s 10% increase in September, China announced new tariffs of 5-10% on $60 billion in U.S. exports to the country, including agriculture products and natural gas. After the announced increase to 25% in May, China said it would increase tariffs on $60 billion in other U.S. imports on June 1.
    Status: Negotiations continue.

    List 4 — (Almost everything else from China)

    Applies to: U.S. imports of Chinese goods, including most or all of the bike products not included in List 2 or List 3.
    Tariff rate: up to 25%
    Type of tariff: Section 301
    Annual import value of all products on List 4, 2018: $300 billion.
    Date proposed: May 13, 2019
    Date to be enacted: Any time after June 24 in any amount up to 25%, on top of the regular rate of duty.

    Impact on our industry: Adds in most or all bike-related items that were not in List 3, including lights, helmets, unspecified parts and accessories, apparel and footwear. The industry is planning to submit requests to exclude bicycle products from this round of tariffs.
    Status: June 17, 2019, is the deadline for companies to submit comments to the USTR requesting to be excluded. A public hearing will be held June 17; requests to appear at the hearing are due June 10.
     

    The EU list

    Applies to: U.S. imports of products from the European Union, including some bike products.
    Tariff rate: Up to 100%
    Type of tariff: Section 301
    Annual import value of all products, 2018: $11.5 billion
    Date proposed: April 8, 2019
    Public hearing: May 15-16, 2019

    Impact on our industry: Applies to imports of EU parts, including sprockets and hubs.
    Retaliation: The EU has proposed retaliation that would include some sprockets and hubs from the U.S.
    Status: Matt Moore, representing the BPSA, was scheduled to speak at a public hearing about this proposal on Thursday, May 16. Comments are being accepted until May 28 at regulations.gov/docket?D=USTR-2019-0003.

  • Bike industry, others, testify against proposed tariffs on European imports

    WASHINGTON (BRAIN) — While the U.S. trade war with China is getting the most attention, the U.S. is also engaged with a dispute with the European Union, and the bike industry is involved in both. On Thursday, the Bicycle Product Suppliers Association was scheduled to testify in Washington regarding proposed new tariffs on some bike products from the EU.

    Matt Moore, counsel for Quality Bicycle Products and a board member of the BPSA, was scheduled to speak Thursday morning as part of a panel group at the U.S. International Trade Commission headquarters. Moore was part of a panel that also included representatives from the motorcycle industry. 

    In a letter to the U.S. Trade Representative requesting an invitation for Moore to speak at the hearing, attorney Alexander Koff said QBP and the BPSA were opposed to proposed increased duties on alloy hubs, 3-speed hubs, single speed hubs and freewheel sprockets. Those items currently have no tariff if they come from the EU. Koff said adding tariffs would do little to curb the EU subsidies of Airbus that triggered the proposed tariffs. He also wrote that the tariffs "would cause disproportionate economic harm to U.S. interests, including small- or medium-sized businesses and consumers."

    Several other members of the industry have submitted comments to the USTR in opposition to the proposed tariffs. Christopher Kreidl, the general manager of Euro Tool Works, LLC, an importer of Unior bike tools, commented that the proposed tariffs would affect hand tools that he imports from the EU. 

    "We operate in a very price conscious area and my primary competitors source their tools from Taiwan and China, primarily," Kreidl wrote. "Our tools, being made in Europe, have a higher cost of production and as such we're already at a disadvantage when it comes to price. We attract our customers through our quality, but sadly that only goes so far when justifying a higher price.

    "Euro Tool Works is not big enough of a company to absorb the cost of increased tariffs and we'd be left with no option other than to pass those on to our customers, ultimately costing us a significant amount of business," he said.

    Kreidl continued, "The tariffs in question are a response to unfair practices. As a business operator with a deck stacked against them, I completely understand the desire for a level playing field, and I understand that the figures involved in this case are orders of magnitude larger than my business ever will be. With that said, it seems like such a broad swath of increased tariffs are akin to throwing the baby out with the bathwater."

    An anonymous commenter also opposed the tariff, saying they "would be detrimental to many small businesses that sell and repair motorcycles and bicycles and that sell accessories for these modesof transportation. These additional tariffs would also hurt the thousands of people that use the modes of transportation. The tariffs or any action should be with regard to the large aviation industry only and no other. These additional tariffs may very well cause many small businesses to close."

    The comment period is open until May 28. Information on leaving comments is at regulations.gov/docket?D=USTR-2019-0003.

  • Outdoor industry group tells Trump it's 'taking huge hit' from tariffs

    BOULDER, Colo. (BRAIN) — The Outdoor Industry Association has sent a letter to President Donald Trump and trade officials, urging them to finish trade negotiations with China and lift recently imposed and proposed tariffs on Chinese imports. 

    The OIA warned "the ongoing trade war and higher tariffs will devastate one of the nation's strongest industries, which is a major contributor to the growing $887 billion outdoor recreation economy and makes up over 2 percent of U.S. GDP."

    PeopleForBikes is a member of the OIA. The bike group issued a statement last week saying it was monitoring the tariff developments. It said it would make more comments following a hearing regarding proposed tariffs on imports from the EU this week. 

    The OIA letter said the 10% tariff on some outdoor products that took effect last September has stifled growth in the industry and further tariffs would be more damaging. 

    "We look forward to a successful conclusion of the negotiations with China and the immediate removal of the punitive tariffs that affect America's Main Street businesses. We stand ready to work with you on passage of the United States-Mexico-Canada Agreement (USMCA) and additional bilateral agreements that will provide significant benefits to outdoor companies and consumers," the OIA concluded. 

    The letter was signed by Amy Roberts, OIA's executive director. It cc'd Larry Kudlow, the director of the National Economic Council; Robert Lighthizer, the United States Trade Representative; Steven Mnuchin, the Secretary of the Treasury; and Wilbur Ross, the Secretary of Commerce.