After last week's dive into the changes in bike geometry over the past 10 years, we took some inspiration from pb user @grononosse who suggested we should look at how much prices have changed in the same time period too.
We've always believed that you get more value for money in 2021 than you did in 2011 but we couldn't be sure until we put it to the test. Of course, it's never going to be possible to compare apples to apples here and a lot has changed in the past ten years, including the number of chainrings, the sizes of wheels, and the components on the frames. Despite this, we've tried to compare bikes that are as similar as possible in intentions and build.
The buying power of a dollar has also changed. Because of this, we've given each bike 2 prices - its original price in 2011 and how much that amount of money would be worth in 2021. To do this we used the CPI Inflation Calculator (thanks @ohbmxer) that can be found here.
Specialized Stumpjumper Evo Expert
Yeti Sb66
Trek Session
Giant Reign
Intense Tracer
Santa Cruz V10
Cannondale Scalpel
Shimano Deore XT
Fox 34
Bonus: What do you get for $3,000?
$3,000 is a good benchmark for intermediate-level mountain bikes and it's the cut-off point we used for our recent Value Bike Field Trip. Less expensive bikes are where we believe the biggest gains have been made in terms of value for money so we wanted to select a handful of models at this price bracket to check those differences. We used the Ibis Ripley AF from the most recent Field Trip as the modern benchmark bike as it was Levy and Sarah's favorite and compared it from 3 models with around the same price tag in 2011.
2021 - Ibis Ripley AF
2011
Pro-tip: When you change jobs, do not let them strong-arm you into telling you how much you make at your current position. They only use that information to figure out how much they can low-ball the salary offer.
When asked, just say that you've looked at what the current market value is for that job at your level of experience, and you'll be happy to talk more about compensation when the hiring process gets to that point.
To be fair, I usually just ask salary in the first call. I took a lot of calls last time I switched jobs (I am a CPA and get a lot of headhunters reaching out) and it is not worth me considering a company if they don't pay properly.
To me that looks like I'm losing money for working hard...
Time away from work to ride bikes is priceless
Of course the last year has been a bit crazy. But prices have only doubled if you bought all your stuff on close out from online retailers. Of course that won’t happen if everything is selling. They’re still selling stuff FAR below market value based on inventory. If you blame the bike industry for what’s going on I don’t know what to tell you.
It wasn't always this way though. My dad worked for the same company from 1969 until he retired a few years ago. He has a nice pension in addition to his retirement savings, which has made travel and a shiny new car possible. Pensions like that don't exist anymore for most jobs, so there's zero reason to stick with one employer. With so many people moving around, employers know they could replace you with someone cheaper, so there's no need to really give you a raise. It's a vicious cycle, and everyone loses in the end.
This is for a product that hasn’t changed one bit mind you.
people are acting like showing the inflation price of the old bikes means bike prices didn't really go up much.... BUT it's the opposite. Not only did the EVO go from just over 4 grand to 7 grand BUT your dollars are worth LESS which means bikes cost even MORE then we thought...
I hope you have as many more years of successful self employment as you desire, or at least long enough to work off the giant chip on your shoulder about working for someone else before it ever becomes a necessity.
Pretty much Hopeless Dude...
My wife worked in a professional photo lab that was filled with people who had highly specialized skills with darkroom equipment and film processes. They were wizards at their craft, then they were kicked to the curb.
I would take a 2011 hardtail $200 bike over no bike.
And they did influence price of other brands. I remember that at the time of the unlimited ltd models of yt you could also buy a morewood makalu with top of the line bos components for below 3k:
www.mtb-news.de/forum/t/dh-world-cup-bikes-fuer-unter-3000-euro-mag41-und-yt-industries-machen-es-moeglich.552543
www.mtb-news.de/news/yt-industries_tues_2-0_dh_ltd_wc
www.bikeradar.com/reviews/bikes/mountain-bikes/rose-beefcake-fr-sl8-review
www.dirty-pages.de/yt-tues-2-0-limited-wc
www.mtb-news.de/news/da-fuer-einen-tag-yt-industries-ltd-edition-fuer-2999-e-am-11-12-13
enduro-mtb.com/endlich-verfugbar-das-tyee-enduro-2013-von-propain-bikes
www.radon-bikes.de/uploads/2016/dce_downloads/radon_specheft_2015_DE.pdf
Sure things like GX may be better than what most stuff was 20 years ago but is not an XO to XO comparison. Thats how they are saving money. The cassette comparison was terrible too, the good 12 speed cassettes are 500 bucks, the old ones were 250 odd in the 10 spd days.
almost everything there has been skewed to support the narrative that they are trying to sell.
However I wont argue that the base level bikes these days are up there with top of the line bikes from 10 years ago but thats not really a proper comparison.
Priceless
So yeah, the price of a bike may not have increased much when compared to the CPI, but your ability to have the spare income to purchase it has as housing costs increase it has.
Bingo! Factoring in the increased cost of a house purchase or rent is critical to any annual inflation discussion. Also, consider the cost of a garage for N+1.
And it’s a little confusing how complaining about flat bike prices is a response to increasing housing prices. Seems like people having trouble buying bikes because housing is more expensive could do a lot better complaining about housing. It’s even weirder to imagine that it is somehow a bike company’s responsibility to offset the impact of housing prices in consumers budgets.
I know some of these musings border on putting words into your mouth, but it’s hard to see the relevance of your observation without going beyond what you directly wrote.
Has someone posted wage data here that I missed? Cause that’s a pretty huge “if” to toss out there.
Specifically, there are a lot of people who clearly think it's the bike companies job to magically make a top of the line bike fit their budget. And when that doesn't happen - for whatever reason - they assume the industry is executing a conspiracy to defraud them.
So if we're going to talk about these external factors on a thread like this I think we need to be really clear about who is responsible for the current situation, and who should be expected to address it. Because I think those people hear "bikes should be cheaper since people have less money to spend" and have neither the knowledge or motivation to connect the dots to monetary policy and politicians re-election campaigns.
The mistake people make is thinking that this implies making the bikes cheaper, whereas in reality what they do in a free market is set the highest price the market will bear.
If bikes are getting more expensive, yet still selling out, we're obviously content enough with the prices being charged.
Prices aren't coming down until the number of bikes that have to be sold at screaming end-of-season markdowns is high enough that it eats into net profit.
Of course they sell bikes for what the market will bear, but the market is absolutely flooded with competition. There are plenty of checks keeping prices reasonably honest unless someone just wants to get fleeced by Yeti or something.
Buying fewer bikes is not the answer. Higher volume supports more competition, economy of scale, and lets companies profit off volume instead of relying so heavily on margins. Booms like we have now don’t help though.
Why would you cut prices on 100% of your sales to avoid selling 10% at a loss instead of cutting production by 10%?
Bikes aren’t getting more expensive in general. Didn’t you read the article?
The top of the line bike may not fit every individual's budget (sounds like not yours), but they are selling plenty of them. Some bike companies only pitch to particular price brackets (Yeti for instance), others cover a bigger spread, but make no mistake, every bike sold to the enthusiast market is priced to the market, not according to actual cost of production. Perceived exclusivity from higher cost actually drives increased sales of luxury goods like Yetis and S-Works E-Bikes.
Back to the article, I did indeed read it, and aside from the Session, most of the bikes have got more expensive, as well as stepping down a component tier. And that's despite the US$ being at a historical low in 2011, and relatively strong in 2021 - most of the cost of those bikes is ex-Taiwan, Japan or China.
As for why you would cut prices to make more money, it's simple.
In a more normal market where there is competition for market share, there are more bikes than shoppers.
You would cut prices on 100% of your product by 5% if that meant you could sell all of it at full price (undercutting a competitor), vs maintaining your price and selling 60% at full price, 20% at 10% discount and 20% at 50% discount.
If you cut production instead of cutting price, unless you are a monopoly supplier or have rusted-on brand loyalty, you would still have competition, so you would still be discounting some of your stock. And If you cut your production by 10% you only decrease your marginal cost of production, but fixed costs (real estate, machinery, marketing, permanent employees etc etc) are a significant proportion, so cost per unit sold goes UP.
Modelling the above, take the theoretical retail of a bike at $100, cost at $50. Sell 10 bikes at $100 = $1000 gross, $500 margin. That's the current market, where demand is high, and every bike is getting sold at list, much of it on pre-order, but it's far from normal.
Cutting your price by 5% to make sure you sell all of your bikes at full price (at the expense of your competitor having to run close-out discounts), 10 bikes at $95 = $950 gross, $450 margin. If you had maintained your price at $100, you would have sold 6 bikes at $100, 2 at $90 and 2 at $50 for a total of $880 gross, $380 margin (43% margin). Cutting your production by 10%, say 50% of your cost is fixed and 50 marginal. Lets be generous and say you have one less bike remaindered, 6 at full price, 2 at 10% discount, one at half price. Your gross take is now $830, net is now only $355.
Yes, I have managed a retail store before, including inventory planning. While I'm no longer in the business of 'selling' anything for profit, a big part of my day job now is demand, capacity and cost modelling to achieve maximum throughput for a State health programme, and many of the same principles apply.
And yes I know I am spoiled. I love my 2018 Altitude...
The dropper probably has a lot to do with it.
Stuns bikers wherever I go.
...though the 1999 bike would snap in half if you pushed it to do what the 2021 hardtail can do. I don't even take mine on the trails, its been demoted to pulling the Burley trailer
By 2016 carbon frames were no longer just on the most expensive bikes and although bikes evolve each year a 2016 trail bike will be comparable to a 2021 bike. Mid to high-end trail bikes from 2016 & 2021 will have a carbon frame, 1x gearing set up, forks will probably be a Pike of 34/36, tubeless tyres, etc, etc.
2021 tacoma, 4dr trd offroad - $39,500
3.4% a year
The Yeti only went up by 1.2% a year. Nearly 1/3 as much.
And it’ll keep going up by that much as long as consumers keep buying them. Prices wouldn’t increase that crazy fast if people wouldn’t buy the latest and greatest every other year.
We vote with our dollars daily.
2021 Trek fuel EX 8 29 = $5,299 AUD
Bike cost after 7 years is almost 1.8 times what it cost in 2014
Or an increase of 80% in 7 years
Or average price increase of approx 11% every year.
On those figures, the US $ equivalent prices were $2849 for 2014 vs $3815 for 2021. That's only a 34% total price increase, or a little under 4.3% compounding price increase.
2012-2014 was a great time to be an Australian buying anything contracted in USD prices.
The 2021 equivalent - £5000
My 2 cents
www.singletracks.com/mtb-gear/are-mountain-bike-prices-going-through-the-roof-nope-more-like-the-basement
In fact it looks like 2011 was peak pricing (relatively speaking) so it's the worst year to compare to.
Made for a way more versatile bike, and the minor change in suppleness was no big deal to me.
the past is imperfect
the present is tense
the future is malign
and immortality lacks evidence
lay down and eat roses
I take "eating roses" to mean enjoy what you've got when you have it.
I made the mistake of buying 10 $500 cars and trying to make up for someone elses lack of maintenance, instead of buying one good $5000 car.
As for poetry, well, the present has a lot to do with perception and "The future's uncertain and the end is always near" J.M.
It will still take a while to save up for a car and bike, but if anything that helps teach budgeting and stuff. (also car insurance for a teenage boy is very expensive).
Ideally I could get a job at my LBS, that might be hopes and dreams though.
I'm an affluent westerner like you, and the amount of disposable income westerners have now compared to when I was your age is insane. At the same time, relative prices of things like cars and bikes at the 'utility' end of the scale have changed far, far less than wages. I'm in Australia, but I'm pretty sure the same holds more or less true in the US.
Price changes we are looking on Pinkbike aren't really inflation, they are repositioning of a small section of the market in response to demand and perceived value. The bikes we're looking at here are valued as 'aspirational' (extending to 'luxury') items, not utility. The road bike I bought for $600 with low-end Shimano components in 1989 would cost pretty much the same in 2021, yet the minimum casual hourly rate in retail has quadrupled in that time. A new small car in 1989 cost 2/3 of the average adult yearly earnings, now it's 1/3 of average weekly earnings, and the car is bigger and better in every way.
The reason bikes we like have got more expensive, is that more people are demonstrating that they are prepared to pay more money for them. That's supply and demand capitalism at play, not inflation.
I do understand that we have a lot more privilege and access to better stuff, my dad won't let me forget about that ever, and I guess that's why the amount of money people are willing to spend of fancy cars and bikes has risen so much.
I'm not talking about buying really nice bikes or cars either, I think my maximum budget for a car is $3500 and the bike is less than that, if I ever do end up buying it. I was a little bit too optimistic in the previous post, more likely my money will go to insurance and savings. That still does sound very privileged as I am typing it, lol.
So yeah, the price of a bike may not have increased much when compared to the CPI, but your spare income to purchase it has after spending a MAJOR chunk of your paycheque to service your mortgage.
2012 stumpjumper carbon comp - $4100 AUD (add inflation) vs same bike now $7100 AUD
2016 enuduro expert $7000 aud vs now $11000.
Exchange rates:
2011-2012: 1AUD = 1.05USD ---AU$4100 = US$4305
2020-21: 1AUD = 0.72USD ---AU$7100 = $US5112
That's only a 19% price increase over 9 years.
Maybe this is why industry reps don't comment on high prices, because it may come across as per Chris Cocalis of Pivot:
"Cocalis says that it’s not fair to compare cars and bicycles — or even motorcycles and bicycles — because the bike world innovates on a pace that’s a lot closer to that of iPhones than that of motorized transportation."
$1,050 in today's (2021) dollars is $2,067. For $2K I could buy a Norco Torrent A2: 4 piston disk, dropper, 1x 11sp drivetrain and 150mm fork.
That's a significant improvement, and one we'd expect. As I mentioned earlier, mountain bikes SHOULD be seeing reduced prices from economies of scale, and further outsourcing to cheaper-labour countries. I couldn't find historical sales data but I suspect it's 10x what it was in 1990.
Drum roll...
NOTHING - because it's in USD and even $3,000USD pretty much guarantees you a shit bike with shit components! Big Grin . So, by the time you upgrade your drivetrain, fork, shock, and wheels, it'll be another $2-4K worth of upgrades! That's if you can get the parts
I'd hate to think what the 2011 version cost.
My hard tail is an old school 4x, dialled holeshot MK2. So short and steel head angle. Ride pump track, skate park, trails, jumps. I can fine tune the height of the front to suit what I am riding, the conditioned etc. Normally only a couple of clicks either way as adjusting it on a HT does change the effective bar sweep and the lyrik has a large adjustment range.
If I was to ride some gnarly stuff, which the bike can do, then raise it up and roll the bars a little to suit.
Yues 2.0 frame
mz fork and DB shock
X0 brakes and shifting
Demaxx ultimate wheels
-- They always had.