Excuse my ignorance what is this?
Thanks
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Thatās a good point. For each model they are effectively engineering 5 bikes (if you believe their marketing of size specific carbon tuning). While for cars it is just one with maybe some slightly different suspension tuning and tires but the body is the same. Also, bike companies may actually have 4 different ālevelsā of a model that includes different types and layups of carbon and maybe 1-2 aluminum variants.
PS. Though I have heard some experts in the carbon manufacturing industry say that companies with ādifferentā grades of carbon are actually the exact same bikes but they just pull the lighter frames off the line and call them a totally different carbon but in reality it just had 75g less resin than the cheaper variant.
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Indeed. I didnāt even think to mention color options. Considering that many low to mid levels are often available in at least 2, sometimes 3 colors, that blows the matrix up even worse.
I know there is some level of comparison with auto stuff, but they have gotten that refined over the last couple of decades. They now control models, colors and option packages to keep these types of explosions under control.
Bike makers try their best, but since no single solution seems acceptable (flash vs subdued), they are always fighting to offer what a customer wants, with limited info. Not a challenge I would welcome. 
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chad beat me to itā¦but it is basically an inventory count of a product you are selling. So if you have one bike model that comes in 5 sizes and 2 colors, you have 10 SKUās that you need to manage.
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And that 5 x 2 = 10 is just for ONE single model. Consider that something like a Trek Domane or Marlin as at least 3 component option levels, and this grows into a massive messā¦ with ājust one bikeā.
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I was thinking more just about road bikes but sure we can talk about other types as well.
and something like 4 colours for each ālevelā too. Trek are busy this year
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Replace āMarlinā with āDomaneā thenā¦ and you have exactly the same issue. The precise genre of the bike is not all that relevant to recognizing the scales involved.
- Your post never stated āroadā as the focus. The reality is that pricing runs across the whole industry regardless of the type of bike involved.
What is relevant is seeing that the simple explosion of any single ābikeā and then seeing the forest for the trees when you see that they offerā¦ Road, Gravel, Fitness, MTB just to name a few. And there is a wide range of bikes within each of those genres.
Even then, their margin is crappy (~5%*).
Guess bikes are a terrible biz no matter the size of company.
*on par with most restaurants and we know how many restauranteurs are rich. So you might as well open a restaurant, at least then you can eat for free!
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Indeed, itās easy to oversimplify a look at this and think that we are getting āripped offā. Too often, people point to the top end halo bikes, while ignoring the reality in the ranges that really matter to most buyers and bike shops. They each need access to, and good options within, those low to mid level bikes. That is where people make their living (or not) and is what really matters in the broad scale of these discussions.
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As the saying goes, if you want to make a million dollars in the bike biz, start with two.
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Hereās a real world bike example:
Trek Fuel EX 8 2008: 2420$ MRSP (2976$ in 2020 money)
Trek Fuel EX 8 2020: 3499$ MRSP
So with inflation accounted for, this tier of Trek Fuel has seen approx. 17% price increase in 12 years.
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Assuming your example is representative, that doesnāt seem crazy. 17% is nothing to scoff at but the equipment and build of the bikes are very different, i.e. the current trek fuel ex is likely much lighter, better operating, and has some advanced tech.
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Interesting, but I would want to see a full spec list for both to really make that comparison relevant.
- A pure numbering comparison like that may well miss the reality on whether the bikes are actually āequalā with respect to what was on offer at each timeframe.
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That is only looking at one aspect of the comparisonā¦and assumes that all parts / components / frame design, etc. remained the same since 2008. The reality is that 2020 version of the Fuel EX8 has almost no comparison in technology to the 2008 version. New suspension tech, components, etc.
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Here are the official Trek pages:
(will review in detail in a bit)
https://archive.trekbikes.com/us/en/2008/trek/fuelex8#/us/en/2008/trek/fuelex8/details
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This was debated at some length in the 12% price hike thread.
Iām a fairly strong believer that the industry has been pushing up prices pretty hard, but as has been noted, thatās basic economics - you push up prices until either a) demand drops off sufficiently that your overall profit margin drops or b) a competitor spots the opportunity to undercut you.
Only one example, but prices have gone up well above inflation; a (UK) 2017 Emonda SL6 Pro was Ā£2800 RRP; a 2020 version of the same model, Ā£3350. Allowing for inflation at an average of 2.5%, that would be Ā£3017. My gut instinct (while admittedly not a scientific study) suggests this is just one example of many.
And I think itās in this mid-market area that the industry is keenest to increase prices. The bottom end is very price sensitive; the top end seems relatively insensitive (if you can afford to spend 9k on a bike, you can probably afford 10ā¦).
Ultimately, only a drop in demand or the emergence of cheaper competitors will reverse this trend. As has been alluded to earlier, I suspect 2021 might be a very good year to buy a used bike. And if the shift to second hand sales is big enough, that will lead to unsold new stock, which will lead to discounts. We shall see.
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Absolutely. And for the record, I donāt find a 17% increase in 12 years to be all that much.
I am not sure if itās fair to talk about the changes in technology etc. to justify the jump in price. I think Trek would say that the bike was cutting edge both then and now, versus what was available at the time. Just like the current iPhone is a lot better than the first generation and so on.
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I agree - not if weāre thinking in inflationary terms. The question is what is the relative cost of the most closely comparable product then vs now. If 2 bikes were positioned at the same place in the range (i.e. the Emonda SL6 pro), then you would expect prices to be broadly similar. Anything else is a deliberate price increase.
As to whether or not thatās justified is a different question, and I always think any question about āvalue for moneyā is a very personal one. To many people, any bicycle costing 3k (much less 5, 8 or 10) is innately very poor value. Others might view the fact they can now get a carbon framed, carbon wheeled, electronic-geared bike for 4.5k or less as tremendous value.