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The fitness equipment supplier Peloton, considered the winner of the Corona crisis, is recalling both models of its treadmills after a series of accidents.
It is explosive that in mid-April the company initially rejected a warning from the US consumer protection agency CPSC about its treadmills.
The CEO John Foley called the allegations "imprecise and misleading" at the time.
On Wednesday, Foley apologized for his corporation's initial reaction.
One should have worked “more productively” with the agency from the start, said Foley.
Peloton shares fell more than ten percent at times in early US trading on Wednesday.
The company presented its quarterly figures on Thursday.
The $ 4,000 Tread + model hit the headlines back in March.
A six-year-old child died when pulled under the carpet on the treadmill.
According to the consumer protection authority, a total of 72 incidents were reported.
In 29 cases, children were injured.
They suffered abrasions, broken bones and open injuries, among other things.
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With the somewhat cheaper Tread model, the screen could break off and injure the user, warned Peloton and the CPSC.
The company is now threatened with a wave of lawsuits. A number of law firms are already gathering clients for mass proceedings. The first class actions have already been filed in US courts. In addition to affected customers, law firms are also calling on shareholders to participate in the proceedings in order to seek compensation for price losses allegedly caused by the security deficiencies.
Peloton had grown rapidly in the corona pandemic due to closed gyms and cracked the one billion dollar mark in sales in the Christmas quarter. The company even couldn't keep up with the deliveries and took 100 million dollars in hand in order to reduce the "unacceptable" waiting times with faster transport by plane and ship. In Germany, Peloton does not sell the treadmills, but restricts itself to its training bikes.