Saturday, January 08, 2022

Signs Pointing To Another Short-Supply Season

High end parts, like this AXS cassette, are hard to come by these days.
Recently I have been seeing some write-ups and I've had some conversations regarding supply of parts and bicycles for 2022. 

Let me tell ya- it doesn't look all that great.......AGAIN! 

While some folks seem to think that we'll be slowly rising up out of this, most agree that 'if that happens' it won't occur until late this year. Some other folks are taking a more negative view and are saying this year will pretty much be a mirror of 2021 and things don't look to change significantly until 2023. 

Making prognostications is difficult, possibly foolish, so take this all with a grain of salt, but this stuff is coming from those inside the industry and - in my opinion- most of these folks are trying to be as positive as possible. Outside of cycling, the shipping woes, supply chain issues, and warehousing issues still are ongoing with no end in sight. In my opinion, unless those things straighten out, bicycle people can be positive all they want to be, but that doesn't fix the big issue here. 

I'll list a few of the things people are bantering about here that will affect your abilities to get stuff for your bicycle, and bicycles, in 2022. In no particular order......

  • Energy Crisis In China: China has issues with having enough energy to make things work on many levels. This has affected supply chains. It also may become a big geo-political issue going forward, so bicycles may not be the biggest concern there. 
  • Raw Materials Issues: Some folks are talking about how frame manufacturing and component manufacturing is being hampered by ongoing materials shortages. Especially raw materials.  
  • Demand: Obviously, demand spiked in 2020, but it didn't relent in 2021 with most companies claiming that they had more revenue, by a little bit, over 2020. This puts continued pressure on supply.
  • Shipping & Freight Costs: Shipping container costs and freight costs in general have skyrocketed. This makes anything you want for your bicycle more expensive than it was. New bicycles will cost significantly more than they had been costing pre-pandemic. (If you can get something new) 
  • The Future: Many in the industry are now becoming leery of a sharp drop off in demand or that inflation will induce a drop in sales. Both things seem likely.

I was chatting with a local bike shop friend that shared with me that parts are still very difficult to obtain. You know things are still bad when you see a Tweet with content showing a Shimano 11 speed chain and how happy and excited that made the author of the Tweet. An 11 speed chain? exciting! Yes- two years ago this person would likely have been laughed off social media. Today? We look at that and think, "Yeah, I get you, Man! You are lucky!". 

And sales going forward are going to be rough. First off, I know many companies are not looking to have much 2022 inventory on bicycles due to the inability to get parts. I've heard some bikes are not showing up- which were ordered in the Summer of 2021- until late this Summer or early Fall 2022. Certainly, we will see spotty availability here and there, but one bicycle person was quoted in a story I read saying that it will be 2024 before you can go into a shop and get what you want - on the floor or ordered- in a timely fashion as we could pre-pandemic. Obviously things would have to improve a lot to just get to that point.

Traditional bike shops will have another difficult year in 2022.

So, I feel like 2022 is going to start out rough, possibly get better, and by the time the season is about over, we may see stock on bikes and parts coming back to levels approaching pre-pandemic levels. But......

By that point, will anyone attracted to cycling in 2020 still care? This is the worry that many in the industry have now. And, it is a real concern. I have seen several ads on the local bicycle sales pages for bicycles barely ridden, purchased in 2020, and which- more than likely- are not getting replaced. Look at your local bicycle sale pages and I bet that you'll note that as well. 

While electrified bicycles seem to have a huge potential here in the US, the semi-conductor chip shortage - which is predicted to be ongoing throughout 2022- is going to put a damper on demand. Higher prices for electrified bikes at traditional bike shops likely will push even more sales to D2C brands. So, brick-and -mortar retail looks to have a another difficult year ahead of them. 

As an avid cycling nut, I know that things will be hard to get, so it makes me second guess doing things which I know will put my parts and pieces through hell. Bad forecast for that gravel event? It may mean that I don't show up because I know chains and cassettes are very difficult to get, and I'd rather be riding than sitting around searching the innergoogles for cassettes and chains. (And that's another thing this pandemic-induced shortage has done. It has made ordinary consumers experts in sourcing their own stuff, where they used to go to a bike shop) So, by association events which find themselves facing poor weather forecasts may see the effects of the difficult supply chain issues. 

Whatever happens, it will be an interesting year- again- for the bicycle industry and consumers.


Daniel said...

Earlier this week I got an email from an online retailer saying that they finally have the rotors I put on my wish list back in the spring. They had 10. Total. Between all the stores scattered around the country. 10.
The company I work for makes custom wheels for customers. We're having trouble getting spokes and driveshells so the crew that is supposed to be lacing wheels are instead in the assembly department or being trained to work the CNC machines because there isn't anything else for them to do at the moment, and its been like that for about a month.
Another thing to keep in mind is the Chinese New Year celebrations are coming up (they don't celebrate the new year on Jan. 1) and its two weeks of celebrations so production will probably be down and COVID isn't going anywhere anytime soon. Were not out of this by a long shot.

Guitar Ted said...

@Daniel - Thank you for that perspective. I feel fortunate that I was able to get a hub and a rim to lace up a new wheel for myself. It's just been nuts out there.

Barry said...

Just had my bike in the shop - needed a new chain and cassette. The chain was no problem, but they don't expect to be able to get an 11/32 ll speed 105 cassette until 2023...

S.Fuller said...

Somehow, I decided that this is the year to upgrade my Carbon Warbird's drivetrain. It's definitely been a game of patience and a bit of a hunt for things. Best thing you can do is have the money in hand and be ready to spend it as soon as the items you want are available. That's not always easy to do. I haven't finished my build and I'm already planning on purchasing an extra chain and cassette for "back stock" here at home.

teamdarb said...

Something to take care of is be really selective on what you find on eBay. There are characters selling items they do not have by using the charity and seller away options. Also, take note of the large number of new sellers with little feedback.

Guitar Ted said...

@teamdarb - Thank you for those words of caution. Good to be wary in these times. I have heard about counterfeit parts as well. As always- Buyer beware!