Inflation steadily grows worse (were does premium bikes fit in?)

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wheelsONfire
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Location: NorthEU

by wheelsONfire

There seems to be steady updates to inflation and it moves into worse.
Just looked now and they say we won't see prices for food, roof over head yada yada come down to "normal values" again.
How will this affect the sales of premium bikes?
Most here are nerds, so if those with big pockets take their own ego out (not to be rude), how will the market globally handle this?
Tried to fish around more locally and to me it seems like there's (to put it mildly) a really poor understanding for big money going to a bike.
Most i guess have some sort of relation and that might also have an input in a potential buy!?

Are manufacturers relying on hybris - cyclist buy at any cost?
Or how does it really work?
Did Shimano and Sram release 105 Di2 and Sram Rival AXS foreseeing this?
To me it seems many who have a smallish income would need to buy bikes at some sort of installment.
But will they?

Personally i think this is a big thing these days when bikes start to cost like a motorcycle or like a really fine second hand car.

What do you guys think?
Bikes:

Ax Lightness Vial EVO Race (2019.01.03)
Open *UP* (2016.04.14)
Paduano Racing Fidia (kind of shelved)


Ex bike; Vial EVO D, Vial EVO Ultra, Scott Foil, Paduano ti bike.

Andrew69
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Location: ɹǝpunuʍop

by Andrew69

Common sense would say that ever increasing high end bike prices arent sustainable, but at the moment, the market is not following common sense!

I read somewhere that inflation in the US is at 40 year highs...but corporate profits are at 50 year highs!
So much of the inflation is being casued by increasing corporate margins, and as long as people keep on paying, the companies will keep on profiting.

I know that Specialized MTB dealers here in Australia are already heavily discounting their high end stock. I havent heard if the road side is similar so cant comment on that.

But as you say, when you can buy a very nice motorbike for the same money as a top end bike, there is something fishy going on for sure

by Weenie


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spartacus
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Joined: Mon Apr 04, 2011 6:53 pm

by spartacus

The fed is trying to engineer a recession so that wages don't go up because they think that will bake in the inflation. In reality this will only hurt the poorest people mostly. I think wages have gone up generally. A few years ago 18/hR for a fast food job was a pipe dream. I think the price increases are partially due to supply chain/pandemic things and partially due to monetary inflation. I don't have a crystal ball but I don't see prices in general coming down. If it seems like too much IMHO the winning move is to switch jobs. Loyalty doesn't pay anymore and it seems like you can net a quite large gain by moving jobs in this market; so that's gonna be the ticket to affording a nice bike versus trying to wait things out.

LanceLegstrong
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by LanceLegstrong

Andrew69 wrote:
Fri Oct 14, 2022 11:23 pm
inflation in the US is at 40 year highs...but corporate profits are at 50 year highs!
So much of the inflation is being casued by increasing corporate margins
Corporate greed. Fixed it for you. This is the problem. They keep calling it inflation but if every industry is posting record profits, it's not inflation, it's greed. Bike prices go up, people buy them. Why would they stop?
Specialized Tarmac SL7
Specialized Crux
Velobuild 168
Trek Checkpoint ALR

Andrew69
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by Andrew69

LanceLegstrong wrote:
Sat Oct 15, 2022 1:30 am
Andrew69 wrote:
Fri Oct 14, 2022 11:23 pm
inflation in the US is at 40 year highs...but corporate profits are at 50 year highs!
So much of the inflation is being casued by increasing corporate margins
Corporate greed. Fixed it for you. This is the problem. They keep calling it inflation but if every industry is posting record profits, it's not inflation, it's greed. Bike prices go up, people buy them. Why would they stop?
I have no problem with people or cpmanies making money...hey will all have to live.
But this is really getting out of control
As you say, it is corporate greed, nothing more

patchandscruff
Posts: 141
Joined: Fri Apr 22, 2022 8:58 am

by patchandscruff

As I mentioned on a previous topic, there are plenty of cyclists out there in the high earning bracket who will keep buying the top end frames and components. They're barely impacted by fluctuations in the global economy. It was the same back in 2007/2008.

BigBoyND
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Location: Berlin, DE

by BigBoyND

The people who buy bikes for $15k are the same people who have the resources to benefit from crash/boom cycles.

My wealthiest friends are the ones who buy houses and cars highly discounted during each recession cycle. Same goes for investments. Meanwhile the people at the bottom are struggling most during these times.

pmprego
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by pmprego

Prices will not go down. What goes down is the speed at which the prices change (inflation). What this means is that prices will, for 2023 and onwards, rise less as compared to the increase in 2022.

For prices to go down there needs to happen deflation. For prices to revert to 2020 or so, deflation would be around 10% or so. A 3rd World war is more likely than that.

robeambro
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by robeambro

pmprego wrote:
Sat Oct 15, 2022 7:54 am
Prices will not go down. What goes down is the speed at which the prices change (inflation). What this means is that prices will, for 2023 and onwards, rise less as compared to the increase in 2022.

For prices to go down there needs to happen deflation. For prices to revert to 2020 or so, deflation would be around 10% or so. A 3rd World war is more likely than that.
Prices won't go down, but we may see more brands pursuing the "Soloist" approach, so launch new products that are relatively more affordable.

Where a company already has a similar approach but with different carbon layups (eg Trek with SL and SLR, Specialized with Pro and SWorks) we may see an increase in the price gap between the two, with more of an effort being made to keep the better value option fixed in price, so a more "polarised" offering.

Companies like Colnago and Pinarello won't change anything, their brand image is hinging on luxury / made in Italy etc and they won't be diluting it by creating products for the commoners.

Poddle
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Joined: Wed Jun 15, 2022 12:16 am

by Poddle

Whilst the RRP of new bikes might not drop, the widescale discounting of in-stock bikes will return, if it hasn't already. As an example, Sigma currently have the largest selection of sale bikes I've seen them offer for a long time, with bikes discounted 20%+ across lots of sizes.

It's the same with cars etc. The result being that the actual price people pay for these goods does decrease and RRPs become irrelevant again.

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wheelsONfire
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by wheelsONfire

Romeambro and a more of you, what we see is bikes like Soloist etc. That's really a cheaper frame. You can bet that what you pay for in this frame is lower quality compared to the other line up. What i mean is, you get cheaper bikes for same money you used to get better framesets and better components. It's not cheap, it's lower end compared to what we got previously. I looked at several bikes with close spec to my own, it's completely mad what such a bike would cost today.
Even my gravel bike. I could hardly assemble a alu bike with similar part list to keep same price.
It's rip off. Oh, wages, shiet no no no. Where we live and work it's vice versa. Standard job workers are poorer. It's difficult to explain, but if you rent an apartment here, you can hardly move to another price because cost have been raised very much. All things cost way more and wages are so so far behind.
10 years ago my money was more worth. I don't expect the typical crowd of cyclist can afford to buy premium today.
Bikes:

Ax Lightness Vial EVO Race (2019.01.03)
Open *UP* (2016.04.14)
Paduano Racing Fidia (kind of shelved)


Ex bike; Vial EVO D, Vial EVO Ultra, Scott Foil, Paduano ti bike.

DaveS
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Joined: Fri Mar 24, 2006 1:26 pm
Location: Loveland Colorado

by DaveS

Those with lower income should consider a frame/post/bars from Yoeleo. $1215 USD delivered with no sales tax, freight or customs duties. An entire Force level bike costs less than some frames. I own two R12 bikes - about $3700 each with Force and BTLOS carbon wheels.

spartan
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Joined: Fri Sep 03, 2004 2:52 am

by spartan

exactly,

in canada sworks vortex shoes are now 600+tax. i see dealers having promo deals with 20-30% off to move inventory. in the past newly released models would get zero discount.
Poddle wrote:
Sat Oct 15, 2022 9:58 am
Whilst the RRP of new bikes might not drop, the widescale discounting of in-stock bikes will return, if it hasn't already. As an example, Sigma currently have the largest selection of sale bikes I've seen them offer for a long time, with bikes discounted 20%+ across lots of sizes.

It's the same with cars etc. The result being that the actual price people pay for these goods does decrease and RRPs become irrelevant again.
Current Rides:

2023 Tarmac SL7 Di2 9270
ex 2019 S-works SL6
ex 2018 Trek Madone SLR Disc
ex 2016 Giant TCRAdvanced Sl
ex 2012 Trek Madone7

AJS914
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Joined: Tue Jan 28, 2014 6:52 pm

by AJS914

wheelsONfire wrote:
Sat Oct 15, 2022 12:06 pm
Romeambro and a more of you, what we see is bikes like Soloist etc. That's really a cheaper frame. You can bet that what you pay for in this frame is lower quality compared to the other line up. What i mean is, you get cheaper bikes for same money you used to get better framesets and better components. It's not cheap, it's lower end compared to what we got previously.
If you think a Soloist is lower end and lower quality then you've bought into the bicycle industry's marketing bullshit. A $6,000 Soloist is probably as nice and as well made as any $10,000 bikes from 4-5 years ago. Carbon technology hasn't changed since then. We only got disc brakes and more expensive electronic groupsets.

We all have to face the fact that the bicycle industry took a page out of the Rolex book and learned how to market bicycles to rich people or at least people seeking what they perceive as "the best". They came with badges like "S-Works", "hand made in Italy", high mod, SLR instead of SL, etc. These badges aren't about quality per se. They are about product positioning and price points. The industry figured out that there is a certain type of buyer that will always buy top of the line (you know who you are :-) ). Having a top of the line label on the product makes it even more desirable so they can virtue signal their wealth to their friends on the group ride.

TobinHatesYou
Posts: 12455
Joined: Mon Jul 24, 2017 12:02 pm

by TobinHatesYou

If there is a slowdown in bike sales, the real losers are the bike shops who aren’t able to move the $13000-14000 bike at full-retail within a year. A new high-end complete bike has maybe 2 years to sell until it hits the break-even point. Compare that to a Rolex which can be kept by a dealer indefinitely and not lose much value…often appreciating in value if it is discontinued. A Rolex also doesn’t consume floorspace/inventory or have many of the same static costs as a bicycle.

When Cupertino Bike Shop had its going out of business sale they still capped bikes at -15%.

Expect more independent bike shops to call it quits or sell their businesses to Trek, Specialized, Giant, Pon, etc.

by Weenie


Visit starbike.com Online Retailer for HighEnd cycling components
Great Prices ✓    Broad Selection ✓    Worldwide Delivery ✓

www.starbike.com



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