Bike prices still riding high due to supply chain backups
Bike prices still riding high due to supply chain backups
This spring, if you are on the hunt for a new bike or a part for an old one, expect to pay more. Demand is sky high, and with shipping slowdowns, bikes and parts could cost 15% to 25% more — if there’s even inventory to sell, that is.
Two years — that’s how long bike shops are waiting for inventory from Asia, said industry marketing consultant Rick Vosper. The shortage began before the pandemic, when President Donald Trump put import taxes on bikes and parts from China.
“So out of fear of tariffs, the industry held back on a lot of orders,” Vosper said.
A tight market, then a pandemic driving people to exercise outdoors, made bikes disappear from shops last April.
The pandemic shortage hit Canadian merchants as well.
“We would close and it was just like, boom, boom, boom at the door. You’re trying to close the door and lock it, and people’s arms are reaching in like, ‘No I need a bike!’ ” said Ira Kargel, co-owner of the Gears Bike Shops in the Toronto area.
Kargel’s sales doubled in 2020. She said it made her feel like she was selling a hot new iPhone, with customers lined up outside the door.
“Like for being a bike retailer I can’t relate to that,” Kargel said. “I can kind of relate to that now. I kind of feel like I’m Apple.”
She said customers bought every single bike in stock: “I’m talking the prettiest, baby blue men’s extra large bike that didn’t sell. Well, people were paying top dollar. We were clearing out [bikes from] 2017 at regular price.”
Some cyclists are resorting to fixing up their old bikes, but shipping backups and COVID restrictions at ports mean Kargel can’t get parts. She said one parts maker said it can’t deliver anything to the whole of Canada until 2022.
“I’ve got about 36 people waiting for $21.99 cranks,” Kargel said. “But if I can’t get it, their bike doesn’t pedal. So these silly little repair parts are as important as a brand new bike.”
In the meantime, prices for pretty much everything — assembled bikes, components, replacement parts — are rising: Import tariffs remain in the U.S., global shipping costs are up and the dollar is weak, which makes imports pricier for American buyers.
New bikes are going for 15% more than last year, even at the Gears Bike Shops north of the border.
“I feel that it’s a bit of a rip-off, the new MSRPs, that they’re higher than I think they should be,” Kargel said. “But the consumer’s demanding them and buying them.”
But will red-hot demand continue post-COVID? Vosper said some in the business are bullish, but he’s not.
“We think that post-COVID Americans are going to revert to their pre-COVID behavior,” Vosper said. “And that means there’s a huge amount of inventory in the pipeline that we don’t have customers for.”
He said some suppliers in Asia have the same fear, so they’re not investing in new factories. And so the delays continue.
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