As Specialised At the beginning of November 2020, the bike community erupted in an outcry when the brand announced that its 2021 bikes would be 7.5% more expensive on average. For example, the Enduro Elite now costs a whole 400 euros more, the Chisel Comp has become 300 euros more expensive and some top models such as the S-Works Epic have even become 600 euros more expensive.
But now it's clear that this was just the beginning, as we explained in our article on Delivery bottlenecks and delays for 2021 had feared. Many manufacturers followed suit, and almost all of them increased prices quietly and secretly. Cannondale for example, has been charging a whopping 800 euros more for the Scalpel Carbon LTD since the end of January, while the price of the Scalpel SE 2 has risen from 3799 to 4399 euros.
Tyre manufacturers too Maxxis increased its prices by up to five per cent at the beginning of the year. Other bike brands such as PropainOrbea and Rose announced in press releases that their prices for mountain bikes will increase in the 2021 model year. Here is an example of the official news from Orbea:
In recent months, Orbea has been hit by rising logistics costs from our suppliers, which in some cases amount to eight times the previous price. In combination with already rising purchase prices, empty warehouses and interruptions in the supply chain, this development puts us in an unsustainable situation. So far, Orbea has tried everything to absorb these price increases. However, we have now reached the point where this is no longer possible. We have therefore been forced to adjust our retail prices in response to this new situation.
Thorsten Heckrath-Rose, Managing Director of the direct mail order company Rose Bikesregretted having to take the step of increasing prices in a press release. "Of course, we would have preferred to keep the old prices. Unfortunately, we could not delay any longer." He announced price increases of 8-12%, but gave his customers a two-week grace period until 25 March 2021, during which bikes can be ordered at the old price.
Increased costs for suppliers and logistics
Most bike manufacturers cite freight and delivery costs, which have multiplied since last spring due to high demand, as the biggest price driver. Manufacturers are passing these costs on to customers.
With these increased freight prices for products from the Far East, it is not just the bicycle industry that is struggling. The World Container Index has more than doubled since May 2020. However, freight costs usually only account for three to five per cent of the cost of a bicycle. Sea freight is usually very cheap. We are talking about around 15 US dollars per bike, and around 100 US dollars for air freight.
In addition, the bike manufacturers are Price increases on the part of suppliers confronted. This is because the manufacturers of frames and components have to invest in production processes due to the high demand. In addition, they currently have the upper hand in price negotiations due to the high demand.
Suppliers, on the other hand, also have to work in individual areas with higher prices for the purchase of raw materials (such as rubber for tyres). In addition, many manufacturers in Corona measures invested and are upgrading in order to meet the sharp rise in demand for bikes.
It must also be noted, however, that the bicycle market has changed significantly over the past year. From a buyer's market to a seller's market has developed. This is because the bike boom that kicked off in spring 2020 has meant that the demand for bikes has significantly outstripped supply.
While in the past, dealers and manufacturers had to look to sell their bikes towards the end of the season - sometimes with significant discounts - the tide has turned since the coronavirus pandemic. The High demand for bicycles ensures that bike shops and manufacturers could sell more bikes than they can currently produce.
And it is precisely this so-called excess demand and the faltering supply that puts manufacturers in the comfortable position of being able to sell their products well despite higher prices.
The whole thing could also Longer-term consequences for the bicycle market have. According to industry insiders, it could be years before this sharp rise in demand can be met across the board, production capacities are ramped up and the supply situation normalises. Smaller manufacturers in particular will have problems obtaining add-on parts in the medium term.
Bicycles could then remain a scarce commodity, and with them the rising prices and long waiting times. The friendly encouragement to buy from Anatol Soostmann, Director Product & Brand at Rose, almost seems like a threat: "If you want to cycle next summer, buy now! Because the boom is here to stay and delivery times will continue to be longer than customers are used to in the bike industry."
Which brands and bikes will be more expensive?
To get a better overview of which bikes will be more expensive in 2021, we have published a circular 42 Bike manufacturers asked: Are you planning price increases in 2021? Just under half of the companies answered. Of these, just under half will raise their prices by at least up to 100 euros, and in some cases by well over 100 euros. Here is an overview of the manufacturers who have already increased their prices or responded to our enquiry:
However, the fear that all manufacturers could increase prices to a similar extent has not yet been confirmed. The fact of the matter is that most bike manufacturers are only increasing their prices slightly by less than 100 euros.
Nevertheless, it remains to be seen whether this will continue. Some manufacturers have been reluctant to make any concrete statements. According to scene insiders, it is probably only a matter of time before all the major manufacturers follow suit and adjust their prices. By the 2022 model year at the latest.
However, the price increases do not necessarily have to affect the entire model range. Many prices remain unchanged, especially in the budget segment. High-priced models are particularly affected.
