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Bicycle shop in Germany: goods are not sold off

Photo: Frank Rumpenhorst / picture alliance / dpa

During the corona pandemic, large parts of the economy suffered from lockdowns and distance rules - but the bicycle industry benefited. Given the high demand and supply chain problems, manufacturers were unable to produce enough bikes. Customers had to prepare for delivery times lasting months, and many parts were also rare.

The run on bicycles and e-bikes later led to a steep increase in production. Manufacturers now often have full inventories and the industry has slipped into crisis: staff cuts and in some cases even bankruptcies, such as the traditional German company Prophete, were the consequences. The Dutch electric bike manufacturer VanMoof is also bankrupt.

Recently the bad news has increased: industry giant Merida from Taiwan reported a decline in sales of 26.4 percent for 2023 compared to the very successful balance of the previous year. The Swiss manufacturer Scott needs a financial injection of 161 million dollars from the South Korean parent company Youngone. Jobs are also apparently increasingly at risk: at the end of last year, accessories manufacturer Uvex announced that it would be closing its Obernzell location in Bavaria (190 jobs). Even companies like Giant from Taiwan, one of the largest manufacturers in the world, had payment problems.

The German bicycle industry is expecting another difficult year. »We still have full warehouses now. They come from production in 2022. It was much larger than what the market could buy," said Burkhard Stork, managing director of the Bicycle Industry Association, as reported by the Editorial Network Germany (RND). In the first five months of 2023, the association registered a 20 percent decline in sales of normal bikes. The decline in e-bikes was not quite as severe (twelve percent). However, the association still expected a decline of ten percent in this segment for the year as a whole.

Among retailers, traditional family businesses with two or three branches in particular would suffer from the high inventory levels, explained Stork, adding: "The capital base there is now very short." Parts manufacturers would be even further behind. Dealers ordered a lot and manufacturers ramped up production.

This results in advantages for consumers: customers can hope for discounts when buying a bicycle. Production in 2022 was much larger than what the market was able to purchase, said Stork. “Some of these stocks are now being sold at discounts.”

But the goods will not be sold off. The idea that you can get bikes for half the price is unrealistic. "But excellent bikes that were built in 2022 and 2023 are currently cheaper than they would be under normal circumstances."

According to many dealers, sales are above the level of 2019, but below the Corona year 2020, said Stork. »We are sure that the market is fundamentally healthy and far from saturated - especially for e-bikes. If there is another sunny spring, the warehouses will quickly be empty and prices can then rise again very quickly.

joe/dpa/rtr