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KTM could be an important lesson in making sure your brands are attracting different people.. As I understand it, the differences between a KTM, Husky, and Gas Gas may be subtle enough to where all the are doing shifting sales from one brand to another.
Is Felt even still a thing?
Great insights all around on KTM. Fascinating.
Same thought on Felt. Maybe we need a companies-you-thought-went-out-of-business-but-didn't thread? Who else would be on the list?
I actually laughed out loud at that. Want to know the crazy part? They somehow sold 25,049 Felt bicycles in the first half of 2024, of which 65% was to North America. Does anyone else feel like this has Enron "they just made the numbers up" vibes? Where are these bikes? Who is buying them? What types of bikes are they? Where are these dealers?
EDIT: to add screengrab in the case I'm reading this wrong.
I won't gnarcistically plug my own YouTube channel here but I have had the misfortune of having to break this down across every review I do on the moto side, being almost all of us singletrack/offroad/hard enduro riders are on some KTM variant at this point.
The reality is the difference between brands is so subtle, so tiny, it makes a mountain biker's head spin. We literally have a lot more variation within each model of bike (build kits) than you'll find between GasGas/KTM/Husky for a particular engine size. IE, the big difference is color, the shape of the plastics, rim color, and maybe handlebar/triple clamp material/brake brand. Its so subtle, and so immaterial.
There is literally no upside to all the complexity that comes with explaining to an entire market that yes, they are in fact similar and but no, you don't have the same access to product across all dealers. A total supply chain and dealer network mess.
All I can hypothesize is somebody on the management team came from fashion or luxury goods. Its the only logical explanation. Brand equity alone matters in those world. It carries a significantly lower amount of weight when you are selling anything that is technological at its foundation.
Dylan Johnson is the only rider I've heard of who's on a Felt (and I only know that because I'm a part-time gravel nerd...)
Ski Town where I'd spent 10 years one night had Rental Fleet Felt at their larger all-season shop. Pretty sure that was not the only area. Nah - no 'Enron' vibes; only 'too much screen time' vibes rolling on.
Hi Jeff,
The slide states the North America bicycle units sold 1st half 2024 is up 65% compared to North America bicycle units sold 1st half 2023.
The split of those 25.049 units sold 1st half 2024 is 47% sold in NA, 46% EU, 7% other.
To the question where all those bikes are? No clue, I rarely ever see one around here as well.
Yup, 25k bikes from Pierer, of which 13k were Felt, and roughly 50% of sales were in NA. So with some simplifying assumptions, ~6.5k in NA, maybe there are more dealers in Canada and Mexico?
As a European based in France, let me tell you that we also almost never see any KTM/Felt/Husky/GasGas bikes on our trails, I imagine they do most of their sales in Germany.
I saw an article this morning that Polaris (also owned by Pierer) will likely miss targets this year.
Polaris is public and Pierer has nothing to do with the management of the firm. Ticker PII. If they own any part of it its just like you or me going and buying shares. (I didn't look)
https://www.nasdaq.com/articles/polaris-inc-q3-profit-decreases-misses-estimates - here is the earnings announcement where the missed targets.
There is no question there is a massive amount of softness in the powersports market. I wonder what the correlation between powersports and bicycles has been over the years. Maybe I'll throw a bunch of data at a transformer model and see if I can't get an answer. I've always been curious.
No surprise. The last 2 winters have been abysmal for the snow sports industry (motorized or not) as a whole for much of North Am. Last year Copper Harbor posted the trails were open in December, as in dirt, not packed snow. For an area that receives 20+ feet of snow annually, that was a hard, hard telling of things to come. On a number of fronts.
Duh. You are right. Too many screens for too long.
The bar chart is still weird to me but whatever, its not important. (numbers aren't summing as they should)
Just to be clear to anyone reading, I am not actually saying Pierer is doing anything fraudulent at all. That was just silly hyperbole. What I'm really saying is how shocked I always am at how big the bike industry really is. We are in such a bubble it seems like we can touch all ends of it, but that is so far from the truth. What is true is how small the hyper obsessed mega into the sport crowd is. That is Vital, and that is tiny.
You ain't the Boss of me.😁
I apparently misread the article. It references ktm/Pierer as they are in a similar situation. This will teach me to post before my first coffee.
https://www.rideapart.com/news/738495/polaris-sales-plunge-snowmobile-u…
Is that 'sold' figure 'sell in' (i.e. sold by Felt to a dealer) or 'sell through' (sold by Felt to dealer and then sold by dealer to consumer, in other words, completed transaction consumer side)?
There could be 25k Felt bikes languishing in warehouses & stockroom going by the vagueness of language.
They acquired the brands along the way to grab the respective customer bases but seemingly have never developed a plan to unite them around one brand, presumably KTM, and simplify everyone's lives. KTM would likely be better served to merge them all and offer short, regular, tall models, especially in the offroad segment or treat each brand as a size if they really want to keep them alive.
PS - I'm tall and squeeze onto a KTM but if GG was the small, KTM the regular, and Husky the tall I could manage with white plastics
I am not surprised the power sports segment is down right now. Nor am I surprised that the mtb market is down either. I live in SW CO in an outdoor rec mecca. All summer and a lot of winter it is a parade of very expensive late model pickups with expensive trailers and expensive "powersports" toys on the trailers, often with a whole separate RV rig of some sort as well. I'm talking about less than 5 year old stuff, seems like most of it, totaling well over $100k easily so people can park in unregulated national forest and drive up and down a few dirt roads in a side by side because they apparently don't want to get their off road capable pickups dirty. It surprises me why they need all this stuff, and also how much they are apparently willing to pay for it. I drive by 2 large dealers with dozens of side by sides on their lots every day on the way to and from work. Somehow the economy seems to keep chuggin along here in the USA! Nose down for me, keep goin to work, try not to spend too much, cuz I'm a family man ;-) Good deals on used mtb's right now. 2018 prices on many new ones too...
Probably from the Rossignol days. They hoped to have ski shops carry Felt for the summer.
To your point about the size of our little hyper-obsessed bubble, PwC 2021 report:
Who buys Felts? Triathletes and time trial people, and by extension roadies that dabble in that side of the sport.
Who buys new Konas, Cannondales or GTs in western Canada?? I have no idea. DTC brands ate Konas lunch, and I only see the occasional newer Habit or Jekyl which I assume has been sold at a deep discount by a shop or to a shop rat on a deal. There's 3-4 years of missing Cannondales - peak enduro time.
I did a little more digging around on Pierer this morning. One thing that really stood out was how poorly their bicycle segment is doing. This is probably of little surprise to anyone in this forum, being we've already covered the Felt thing and we all know the Husky/GasGas e bikes are nothing special. However, look at just how bad the business really is. Negative EUR115M in EBITDA and EUR299 in debt. Just awful.
I made a much longer post on VitalMX and because I'm a gnarcissist I posted it to my blog, too. Somebody let Dak know he's going to be able to buy another 300SX for a lot less money this fall.
….on my way to buy Pierer stock cus our boi Jeff is smart n stuff
Perrier has been criminally unvalued since the La Croix fad of 2018. Primed for a big rebound.
Look who's talking about dampening now!
Holy schlamoly. If Felt sold 24k bikes and no one has seen a Felt in the wild…
How many Stumpjumpers have been sold?? The number has to be inconceivably high.
24k bikes sold with only 47% sold in NA, this explains why no one are seeing them.
Giant sold 6.6 million bikes worldwide in 2017 just to give you an idea.
Or, in the matter of commerce.....
Hey biz thread subscribers, I met with Jeff about a month ago for an Inside Line to discuss the current state of things. It was a rad discussion. The podcast and its copy are below. Enjoy! I know I did.
Thanks to Maxxis Tires | FOX | Jenson USA for supporting The Inside Line
Today we're joined by Jeff Brines, a long-time mountain biker, Litter Mag and Vital MTB fan. He's also educated and versed in finance. He kicked off a forum thread on Vital MTB that asked "Will more companies be shutting down in the next 12-24 months?" At a year old, the thread has over 100,000 views with nearly 800 replies as news about our industry has broken. We discuss the past and current state of the bicycle industry through his analysis and tools and see if we can figure out where we're headed.
Thank you Vital listeners!
THIS IS NOT FINANCIAL ADVICE.
Podcast Contents
0:00 - Intro, who is Jeff and what are we discussing?
6:11 - Why start a Vital MTB forum post about bike companies shutting down?
11:07 - Why did the *money people* think MTB would make them rich during Covid?
17:30 - Is it just greed and ego?
19:55 - Why did bikes stop selling?
23:49 - Why don't brands save money for slow times?
27:54 - Most of the bike industry is privately held
32:52 - Companies that went under, does the investment money just disappear?
38:05 - Original owners buying a company back, Family Office and Private Equity
46:25 - Private equity and how it works
51:54 - Is going bankrupt expected with venture capital investors?
53:51 - The lunacy of VanMoof being worth $500 million
1:04:23 - What does the bike industry future look like?
1:12:41 - Is there any incentive to get into the bike industry now?
1:15:41 - Is there an ideal company size?
1:17:48 - Will the business world repeat the same mistakes 10 years from now?
1:21:31 - Tools to learn about the bike industry
1:26:10 - Vital audience survey
Check out Jeff's slideshow presentation here (Google Slides)
Vital MTB Audience Surveys (scroll to bottom of page)
https://wtfhappenedin1971.com/
Thx a ton for having me. Post any questions or call outs here (which is totally fair) and I'll respond. Also, apologies for all the rambling. I was...nervous. 😬
Post a reply to: The Bikeconomics (Mega)Thread