Cost of driving, cost of bikes
Posted by PeterD Fri, 25 Apr 2008 14:15:00 GMT
Thursday, May 15, 2008, is the 14th annual Bike to Work Day! For those that don’t bike to work, this would be a good day to consider doing that. 511.org has some information related to how to get started, why you’d want to do it, a raffle for those that pledge to ride to work, etc. And there will be energizer stations out at many places where you can grab a bag of goodies, coffee, bagels, etc. (Passion is sponsoring the one at Belmont train station).
Of course, with gas prices what they are, it isn’t hard to understand why you would want to commute by bike.
But, unfortunately, gas prices aren’t the only thing that are increasing…
There have been articles in Bicycle Retailer Magazine recently (like this one) that have been talking about bike industry costs. Here are some quotes:
“It’s not whether prices will go up, but by how much. Somewhere between 12 and 20 percent seems to be the going range. “
and
“One (bike company) executive, for example, said the cost of bringing a container by ocean freight from Europe to the U.S. rose from $2,400 several years ago to more than $6,000 this year. Fuel surcharges on all air and ground freight—UPS, FedEx, DHL and others—have skyrocketed as oil prices spiral well past $100 a barrel.
And that’s on top of price increases for raw materials such as aluminum, steel, carbon fiber and plastic. Further complicating the price structure are inflation, rising wages and pending pension reforms in China, the weakening dollar, the robust euro as well as China’s revaluation of the yuan and reduction of favorable tax treatment for mainland China manufacturers.”
The word we have from our suppliers (both parts and bikes) match this. Even those suppliers like Turner than make their bikes here in the States aren’t immune, as the increased raw material costs are hitting them.
Some prices are going up now, especially for parts. Other products where the supplier does annual pricing won’t see the increase until some time this summer.
Sorry to be the bearer of bad news. But wanted to get this out before sticker shock hits. Seems inflation is here.
CostCo and Sam’s Club have both started rationing rice – limiting people to 4 bags per visit. With carbon fiber supply limits in the market, we are going to do the same with carbon fiber framed bikes – you can only buy 4 at a time (and no, walking out the door and coming back in does not count as 2 visits!). No limits on steel or aluminum frames at this time, so buy all you want.
I hate to say it but the above is very true. As a salesperson in the shipping industry, we’ve raised our rates. Needed fuel surcharges are being tacked on. This isn’t greed. We honestly lost money during the past year honoring contract rates and eating fuel increases. For a number of years shippers have been able to tell us to get lost when asked for rate increases. The market was historically in their favor. Due to financial losses in the Pacific shipping lanes many carriers have reduced capacity. This is increasing demand for available container and vessel space. Also not good for bike shope sticker prices. :-(