Bicycle and sports equipment sellers are facing a second bicycle shortage after an initial shortage occurred in 2020 as manufacturers continue to struggle with high demand and COVID-19-related supply chain challenges.
Sales for traditional and indoor bikes, as well as bike parts, were up 75% to $1 billion in 2020 compared to 2019 as more people looked to outdoor activity amid the pandemic, according to June 2020 research from NPD, an industry analysis and advisory services group that helps retailers and manufacturers.
That trend has continued into 2021 U.S. retail bike sales grew 60% compared to the same period in 2020, according to NPD Sports Senior Industry Adviser Matt Powell. He told Fox News, however, that while he expects sales growth to slow in 2021 compared to last year, they "will remain well above 2019 results."
"There are serious inventory shortages due to the surge in sales," Powell said, adding that average bicycle selling prices grew 40% in the first quarter of 2021 compared to 2019 due to "a mix of more expens[ive] bikes as well as higher retail prices due to increased costs."
Many local and national bike retailers are facing backlogged orders delayed into the fall and winter seasons.
Employees wearing protective masks work at the Trek Bicycle Shop in San Diego, California, U.S., on Friday, May 15, 2020. (Photographer: Sandy Huffaker/Bloomberg)
Bill Thayer, co-CEO and co-founder of Fillogic, a logistics services platform for retailers, said the supply-and-demand issue hitting the bicycle market right now is not just unique to bikes.
"Every retail store, no matter what they sell, are struggling to meet demand based on supply chain disruptions," Thayer said. "Manufactured items that include formed components (aluminum, rubber, etc.) like bicycles are far behind because these components are often manufactured in one place and then fabricated/kitted in another."
He added that supply chain issues manufacturers and retailers faced during COVID-19 have only snowballed as the country reopens.
"During the peak of 2020, [e-commerce] volume surged in the U.S. but many businesses were still closed," Thayer explained. "Now that businesses have opened up and demand has spiked through all channels, these supply chain disruptions will last well into 2022."
The costs of raw materials have increased as a result, leading the final sale prices of bicycles to be higher than they were last year or the year prior.
Mario Veraldo, CEO of MTX Logistics, which offers shipping solutions to U.S. and global companies, told Fox News that 87% of bicycles are produced in either China, India, Taiwan, Japan or the European Union.
A woman rides her bicycle on the boardwalk at Coney Island during the coronavirus outbreak in New York, during Memorial Day weekend 2020. (AP Photo/Kathy Willens)
"The issue with such concentrated production is that you will not get the parts and pieces from somewhere else when the supply chain fails," he said, adding that the issue stems from a surge in U.S. consumption as the pandemic comes to a close.
"Bicycles have become a way for people to move around in emptier cities and return to physical activities. Hence there [is] an increase in demand while the supply is not available even though the pieces might be available," he said. "The lack of supply has induced inflation across the board, and it will be higher in this particular sector due to the production being concentrated in Asia, where the shipping problems are more prominent than in the rest of the world."
The bicycle shortage is also not unique to just the U.S. Lee Bibring, managing director of U.K. cycling travel business Love Velo, Ltd., said retailers in Europe are also "struggling to meet demand for bicycles."
"2020 saw an explosion in cycling participation and we all saw a huge demand for new bicycles, secondhand bicycles and home cycling equipment from the likes of Peloton and Wahoo," he said. "Retailers were wrong-footed but most assumed … that the demand would regress to the mean as it was no more than a COVID-related blip."
He added that second and third waves of the virus hit Europe in the spring of 2021, and retailers "who were reluctant to tie up cash in stock during the winter were caught out and could not meet an even more burgeoning demand for bicycles" during that time.