The bike industry crisis

[Jabubu]

I wasn't sure if there's already a general thread for this but with so many brands having issues I thought I'd just start this one off with the news that Orange Bikes have just gone in Administration..

UPDATED | Orange Bikes Calls In Administrators

In a move that will sadden the brand's many hardcore fans, we're hearing from multiple sources that Orange Mountain Bikes has applied to appoint administrators.

singletrackworld.com

Orange Mountain Bikes of Yorkshire, England, has issued a notice of intention to appoint an administrator. The firm was founded in 1988 by mountain bikers Lester Noble and Steve Wade; it was acquired by Ashley Ball of vendor Bairstows Sheet Metal in 2015.

 

[fjohn860]

Orange Bikes have just gone in Administration..

UPDATED | Orange Bikes Calls In Administrators

In a move that will sadden the brand's many hardcore fans, we're hearing from multiple sources that Orange Mountain Bikes has applied to appoint administrators.

singletrackworld.com

Orange Mountain Bikes of Yorkshire, England, has issued a notice of intention to appoint an administrator. The firm was founded in 1988 by mountain bikers Lester Noble and Steve Wade; it was acquired by Ashley Ball of vendor Bairstows Sheet Metal in 2015.

I hope their filing is up to scratch...

I'll see myself out.

 

[fjohn860]

But in all seriousness, it's definitely sad to see.

 

[Rusty_68]

Moorey was seen wearing a black armband this morning.

 

[Mr Crudley]

But in all seriousness, it's definitely sad to see.

It is, but.....they collectively have seemed fine to carry forward Covid pricing until they realised out that the demand from the casual Covid rider dried up. The supply chains were also in a mess of not being able to meet this demand then once it recovered then the buyers were gone.

Having uber priced bikes is nice but surely must limit the younger or casual rider that just wants something good enough but not professional grade to ride. Folks might want XTR or XT but Alivio or Deore will do just fine.

Having mid range groupsets on bikes that are nudging $6k+ is also plain rude let alone thinking about ePrices.

Unfortunately, we could eventually end up with a few bigger brands that are well cashed up and consolidated together under bigger companies that survive the storm and cheap Chinese bikes will sponge up the rest.

The bed has been made and now they have to lie in it. Oh well......

 

[johnny]

Is there an actual crisis in the bike industry? Not a rhetorical question, I genuinely don't know.

What are the indicators: CRC down, Orange down, anyone else?

Is it just mountain bikes or is it roadies and kids bikes as well? What is driving it: ripple effect from COVID along with supply chain problems? Cost of living? Lots of COVID purchases flowing into the second hand market?

I was only thinking yesterday during the relatively short drive home from a ride that there are so many bikes out there these days. Not only did I see four cars with mid-high level MTBs on them, but even the dude that was filling next to me at the servo had a higher end Rocky Mountain electro on his rack (and he did NOT look like a typical MTBer).

Of course, this is just a very small element of the much larger dynamic, but based on observations from CBR, it seems almost incongruent when viewed at a glance.

 

[Jabubu]

Is there an actual crisis in the bike industry? Not a rhetorical question, I genuinely don't know.

What are the indicators: CRC down, Orange down, anyone else?

Is it just mountain bikes or is it roadies and kids bikes as well? What is driving it: ripple effect from COVID along with supply chain problems? Cost of living? Lots of COVID purchases flowing into the second hand market?

I was only thinking yesterday during the relatively short drive home from a ride that there are so many bikes out there these days. Not only did I see four cars with mid-high level MTBs on them, but even the dude that was filling next to me at the servo had a higher end Rocky Mountain electro on his rack (and he did NOT look like a typical MTBer).

Of course, this is just a very small element of the much larger dynamic, but based on observations from CBR, it seems almost incongruent when viewed at a glance.

Orange administration
CRC/Wiggle administration
Stanton administration
PlanetX in administration

(All UK companies mmm)

Canyon bike losses

Guerilla Gravity out of business
VanMoof out of business
Islabikes closed down

Kona BOGOF sales
Specialized laying off staff and massive sales

MTB race team culls

Crisis is most likely a hyperbolic descriptor but there's certainly a lot of changes.

 

[Haakon]

Orange administration
CRC/Wiggle administration
Stanton administration
PlanetX in administration

(All UK companies mmm)

Canyon bike losses

Guerilla Gravity out of business
VanMoof out of business
Islabikes closed down

Kona BOGOF sales
Specialized laying off staff and massive sales

MTB race team culls

Crisis is most likely a hyperbolic descriptor but there's certainly a lot of changes.

Brexit a factor maybe?

 

[Jabubu]

Orange administration
CRC/Wiggle administration
Stanton administration
PlanetX in administration

(All UK companies mmm)

Canyon bike losses

Guerilla Gravity out of business
VanMoof out of business
Islabikes closed down

Kona BOGOF sales
Specialized laying off staff and massive sales

MTB race team culls

Crisis is most likely a hyperbolic descriptor but there's certainly a lot of changes.

Brexit a factor maybe?

I'm sure it's a contributing factor to a lot of UK's issues!

 

[smiffy]

This video helps explain whats happening, (in short - over stocked, and slow down of economics)

 

[beeb]

How was this even possible:

Accounts show that even during the pandemic boom, they filed a pre-tax loss of nearly half a million pounds.

Orange MTB's are cool in a niche way - but when you look at their website they have what seems like an exceptionally large range of bikes available compared to what I think of as "their position" in the market. Maybe in the UK people actually buy their gravel/urban/road/kids bikes, but it's not what springs to mind when I (or I'd wager most people) think of Orange bikes - and must surely mean they have to carry huge levels of stock holdings on products that would've already been pretty low turnover before the industry/general economic slow-down.

I'm also not sure if it's still just the "website not showing Aus pricing correctly", or their prices really are that fucking insane - but to have not fixed it either way on bikes with such a rudimentary suspension design and polarising looks was begging for trouble even before the market started slowing.

 

[gippyz]

I do think brexit has a lot to do with the UK based companies folding, which is a shame as I bought loads from them. Very competitive (and I must say, sensible) pricing and generous postage price. Shame.

Having uber priced bikes is nice but surely must limit the younger or casual rider that just wants something good enough but not professional grade to ride. Folks might want XTR or XT but Alivio or Deore will do just fine.

Not only that. Cost of living going up through the roof mean peeps cutting back on unnecessary purchases. Bikes and bike parts (especially high end stuff) definitely falls in the category of "nice to have, but not necessary". That and the delay of covid era supply led to oversupply and lack of demand. So companies would either sell stuff at loss (or break even) to recoup some money back or just fold. Unfortunately, many chose the latter. I haven't seen any doing the former.

 

[jrewing]

Black spire gone

 

[Tubbsy]

For the UK businesses, the Brexit situation surely would have made Australia a good option. You’d have thought with a few price drops they could have moved volume here again. Maybe nowhere near enough customers to make a difference?

 

[yuley95]

I’m sad to see Orange go into administration but I can’t understand how so many bike companies survive. Sometimes, to distract myself while i slog up a long climb, I challenge myself to name 50 MTB companies. It’s too easy. And there is no *need* for that many companies. Especially when most MTB companies are actually just frame companies with the rest of the very important bits being outsourced to a small handful of other companies.

I say all this as someone that owns and appreciates a frame from a very small niche company.

Actually, maybe that’s where we are heading - a few massive companies (Spesh, Trek and Giant) then a lot of niche companies (Nicolai, Raaw etc) with a real hollowing out of the mid-size companies with aspirations for the big leagues (Kona, Orange, Nukeproof…)

 

[Jabubu]

I think the same with most products in the supermarket - do we really need 10 different fabric softener brands? It's just waste if there's no real differentiator.

 

[jrewing]

I think the same with most products in the supermarket - do we really need 10 different fabric softener brands? It's just waste if there's no real differentiator.

Same with Yoghurt

 

[c3024446]

This is shops not brands, but up here in Newcastle we had Ride (which used to be Omega Cycleworks) close at Broadmeadow just before Xmas. Cheeky bikes went from 1 to 3 stores and now back to one.

 

[Minlak]

For The Riders (Brisbane) Online only now and I think no more complete bikes or frames - I looked at thei website no real indication of what they actually do now

 

[Flow-Rider]

How was this even possible:


Orange MTB's are cool in a niche way - but when you look at their website they have what seems like an exceptionally large range of bikes available compared to what I think of as "their position" in the market. Maybe in the UK people actually buy their gravel/urban/road/kids bikes, but it's not what springs to mind when I (or I'd wager most people) think of Orange bikes - and must surely mean they have to carry huge levels of stock holdings on products that would've already been pretty low turnover before the industry/general economic slow-down.

I'm also not sure if it's still just the "website not showing Aus pricing correctly", or their prices really are that fucking insane - but to have not fixed it either way on bikes with such a rudimentary suspension design and polarising looks was begging for trouble even before the market started slowing.

I think customer loyalty is diminishing around the globe these days, but the UK has been hit with one of the worst living crises due to energy costs. Boutique brands are probably going to take a hit worldwide, giant, meridia, specialized, and so on do the same job for almost half the price. They have ride to work incentives in the UK too, so maybe they didn't focus too much on where most of the money was.

It makes me wonder how Hope will go. I think you're going to see the Chinese manufactured stuff get cheaper, they're struggling to keep people employed over there ATM.