How much faster is that new aero bike?

[Mark McM]

Originally Posted by benb

I think Giant is probably doing fine and likely making similar margins to the motorcycle manufacturers.

The huge markups likely happen after Giant's customer puts the bike into their supply chain. A big part of Giant's business is building bikes for other people.

It is still really, really, really hard for me to imagine how on earth these bikes could actually cost more to develop than motorcycles though. Anyone saying that strikes me as extremely ignorant of what goes into a modern motorcycle.

The bike industry is way way way more outsourced. The % of parts on a motorcycle that has to be designed, engineered & manufactured by the company that paints it's name on the tank of a motorcycle is much higher than what goes on a bike. And the overall parts count on a motorcycle is through the stratosphere compared to a bike. Even if you go to eBikes.. eBikes have outsourced drivetrain and often many models have the same drivetrain. Go through a motorcycle manufacturer's model lineup and they've engineered a specific drivetrain for each and every model and it's not outsourced. For performance models it gets re-engineered about every 3 years.

The only way it can somehow make sense is if a huge portion of the cost of bikes is lost to all the outsourcing and supply chain. As if all those parts they get to pull off the shelf have such a big margin that it squeezes the bike manufacturers.

Maybe the other thing is bike companies probably sponsor more riders relative to the # of high end race bikes they sell compared to the motorcycle companies. Their wasted money on that is likely a lot higher. And the overall % of the cost of a bike that is due to marketing is likely higher.

Maybe one other thing.. motorcycle cruisers have huge prices and might have bigger than normal margins and cover some of the other models. Bicycles that seems to be the opposite. Hybrids and cruiser style bikes are cheap. If the manufacturers could sell those cheaper to engineer bicycles at a style premium it would help fund all the other stuff.

edit: Probably the biggest reason bikes keep getting more and more expensive is it seems to be attracting an aging demographic and the companies are running with that on the fact that older riders have more and more money to spend if they keep riding into their best financial years.

Another factor is that bicycle companies have more SKUs for complete bikes than motorcycle companies. Visiting the Honda website, I see 9 different models of motorcycles, some available in 2 or 3 colors. In contrast, the Specialized website shows over 300 models (both as complete bikes and frame only), some available in 4 or more colors, and in each in 5 or 6 sizes. The sales volume on each bicycle SKU has to be much smaller than for each motorcycle SKU. Having to manufacture, stock, and ship more SKUs can add substantially to the overhead costs (which is why Trek has announced that in a cost cutting measure, they are reducing their SKUs).

And comparing a $10,00 bicycle to a $10,000 motorcycle is a bit apples and oranges. The $10,000 bicycle is a very low volume top level bike, whereas that might be more mid-level for motorcycles. Again looking at the Honda and Specialized web sites, the least expensive Honda is the $4,950 Rebel 300 (one color, one size), whereas the least expensive Specialized is the $400 Sirius 2.0 (three colors, six sizes), which is a about a 12:1 ratio in price. There are likely more dealer costs (delivery, prep, sales, title, etc.) for the Honda Rebel 300 than for the Sirius 2.0, but probably not 12 times more.