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High-End Wheels Take Hit in Economic Slump

Published May 15, 2009


HAVERHILL, MA—Nothing transforms the ride of a bike like a new wheelset. And in these economic times—when sales of bikes priced over $3,000 have stalled and upgrades like new tires, saddles, handlebar tape and drivetrain components are selling fast—wheels would seem to be the season’s hot upgrade.

But according to wheel makers, sales of high-end wheels are taking a hit while sales of low-end wheels “that get the job done” are tracking ahead so far this year.

“It’s a little difficult to call how sales will go for wheels over $1,000 this early in the season, but one thing I can say is sales of Ksyrium Elites and other wheels in the $500 range are tracking over last year,” said Sean Sullivan, Mavic’s marketing director.

“Our sales above $1,500 are totally innovation driven, so a new product will sell very well, like the $2,000 Cosmic Carbone SLR, but the entire high-end segment is not keeping up with last year,” Sullivan added.

Jessie Gascon, Shimano’s Action Sports Group manager, concurs that technology is driving sales in a difficult economy. Shimano’s tubeless road wheels, like the $1,100 Scandium tubeless and $1,300 Carbon clincher tubeless, are tracking over last year.

“Sales of our $1,100 XTR and $800 XT aftermarket wheels are behind last year, but I think that reflects slow full-suspension sales. Those bikes are sold as frames and kitted up with nice wheelsets, so when the frames don’t sell, neither do wheels,” Gascon said.

Industry analyst Al Budris, founder of Alpha Sports, said the first wheelset boom followed Lance Armstrong’s retirement from professional racing in 2005.

At the time Mavic clearly dominated wheelset sales in the aftermarket and over the next two years reaped big sales increases.

The road bike slowdown and Mavic’s wheelset success were not overlooked by Trek, Shimano or SRAM. All were minor players in 2005 but are now taking a bite out of Mavic’s dominance, as are newcomers to the wheelset market such as DT Swiss, Easton, Fulcrum and Reynolds.

“I don’t see a similar boom happening this season. Sales of high-end wheelsets will trend down as consumers watch their spending,” Budris said. And with all the new players in the market, he expects some fallout this season.

But given all the old bikes pressed into service last year, non-branded wheel business is hot.

“Sales of cheap rear wheels are off the charts, and we are clearly seeing major growth over last year in single-speed wheels and anything with colored rims. But sales of our branded wheelsets are slower than last year,” said Phil Sweet, J&B Importers’ sales manager.

Sweet said his read of the market may be skewed since J&B has been the go-to distributor for inexpensive replacement wheels for 30 years.

Preston Martin said the only wheelsets tracking above last year for BTI are “tool” sales—wheels that get the job done and no more.

“We are selling tools not toys now. People want wheels to keep riding, not to upgrade what they ride,” said Martin, BTI’s vice president.

He also said sales of mountain bike wheels are off more than sales of road wheels. But, Martin said, the late snowy spring in the Rockies means things could turn around quickly.

According to Kenny Roberts, U.S. sales and marketing manager for DT Swiss, one of the new players in the wheelset market, sales of its prebuilt wheels are up at all its distributors. More surprising has been an increase in sales of wheel components like hubs, nipples and spokes.

“I think we are taking market share from others rather than seeing the high-end wheelset market grow. But spoke sales and sales of our $500 250S hubs are up over last year,” said Roberts.

The economy is putting the squeeze on high-end sales now, but when it turns around Shimano’s Gascon expects another aftermarket sales boom.

“Road suppliers are putting all their development dollars into their carbon frames to compete with each other. Because of the economy, they have to bring that frame to the market at lower prices. And the only way to do this is to down spec,” Gascon said.

“Many high-end bikes are actually coming to the market with cheaper wheels than what was spec’d a few years ago. Road customers already have a great carbon frame and when their funds allow they will splurge on new wheels and keep the ones that came with the bike for training,” Gascon added.

Mavic’s Sullivan is just as bullish on the future. He thinks road wheel aftermarket sales will remain strong because road riders typically have a few sets of wheels. Whether aero or super light, a wheelset can noticeably transform the ride of a bike and roadies will always pay for that.

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