Trek CFO Chad Brown on coronavirus sparking a boom in bike sales
A boom in bicycle sales during the coronavirus pandemic caused widespread reports of supply shortages, but Trek CFO Chad Brown told CNBC on Wednesday that the company continues to attempt to keep up with demand.
“We’re still shipping out tens of thousands of bikes every week, so there are bikes out there,” Brown said on “The Exchange.” “I promise you, there are a lot more bikes on the way.”
Supply chains for bikes had been disrupted by the advent of the Covid-19 outbreak in Asia, Brown said. The virus first emerged late last year in Wuhan, China, and led to factory shutdowns and other business closures. The vast majority of bikes sold in the U.S. are made in China, according to Reuters.
An employee wearing a protective mask arranges a bike at the Trek Bicycle Shop in San Diego, California, on Friday, May 15, 2020.
Sandy Huffaker | Bloomberg | Getty Images
Waterloo, Wisconsin-based Trek started to observe the significant spike in bike sales in April as stay-at-home orders spread across the U.S., Brown said. “The inflection point was really Easter weekend. … It’s really been a rocket ship since then.”
The U.S. cycling industry overall saw sales reach $1 billion in April, up 75% year over year, according to market research firm NPD Group. In June, bike sales increased 63% compared to the prior year, with particular strength in high-end offerings, NPD Group reported.
“After everyone bought the toilet paper, they bought kids bikes and then entry-level mountain bikes, and then as the supply started to get tight, it worked its way up,” said Brown.
There are questions about whether the soaring sales just pulled forward years worth of existing demand for new bikes or if stay-at-home orders and other pandemic-related behavior changes brought new people into cycling.
“There are all these people that are on bikes now. Whether they’re using it for recreation or transportation or just as a way to social distance, it’s such a great opportunity to get people outside and off screens, enjoying the bicycle,” Brown said.
And for now, months after the initial surge began, Brown said Trek, which is privately held, continues to see strong interest in bikes from consumers. “When you look at indicators like foot traffic and call volume and even just website traffic, we’re still seeing a lot of pent-up demand,” he said.