Senior Vice President Armin Landgraf on Pon.Bike’s Global Ambitions
SANTA CRUZ, USA – He has an extensive management and consultancy background in the car business. But road and mountain biking are his passion and he loves biking on weekends with his wife and kids in Amsterdam. That makes Armin Landgraf a strong believer in people-friendly, bike-able cities and in e-bikes that ‘enhance the mobility role of bicycles’.
After being with the company for one year Landgraf explains how the Pon.Bike plans to reach its full potential with separately operating brands.
There’s a new name and logo for Pon’s activities in the bicycle sector. Please explain what’s behind the new name and logo?
“We are now Pon.Bike. The name and logo stand for the collaborative force behind all our bike activities. Pon.Bike is also the supporting force behind each brand. It will evolve into a complimentary platform for dealers of our brands. Here they can e.g. check stock levels of the brands they carry and do business in the most convenient way. There’s one login for all brands but they will be displayed separately on the Pon.Bike dealer portal. Such a separate approach indicates how we work – as one family with distinctive brands. Combined we can achieve the full potential of the group. But the brands operate separately. We even want to create more brand autonomy; have the brands stand out more and create stronger brand identities.”
Last February at your Velo-city Global presentation you said that the € 7 billion company Pon stepped into cycling because it is a high strategic fit. You said Pon is in mobility and cycling adds to that. Can you elaborate on this strategic fit.
“This fit has all to do with offering mobility solutions. It’s about consumers making a choice for using a car or a bike, or a combination of both. In crowded cities the mobility role of bicycles is relevant and significant. By 2020 cars and bikes have come much closer together. This makes bicycles a relevant industry to look at. E-bikes enhances the mobility role of bicycles and can offer an even stronger combination with automotive.”
I suppose that e-bikes played a big role in Pon’s reasons for re-starting in bicycles, in particular because e-bikes are 3 to 4 times as expensive as regular bikes. Is that correct?
“What will drive profitability is the fact that e-bikes turn selected bicycle categories into a much better product for specific consumers groups who are willing to pay more. The connectivity possibilities that come with e-bikes present even more consumer appeal and with that a significant growth potential.”
Is Pon’s re-start in bikes in June 2011 with the Gazelle take-over also triggered by the expected mobility-transformation with less cars and more bike-able cities? Can you say more on that mobility transformation?
“Riding an e-bike helps to understand how that mobility transformation might work out. For instance commuting, even in hilly terrain, can be easily handled. Electric bikes and regular bicycles have the ability to change our mobility-patterns. When using a bike you suddenly find out this is fun and you don’t have to worry about finding a parking place.”
What do you expect for e-bikes in that mobility transformation in the next 5 years?
“By 2020 all of the world biggest cities will have bike lanes. More people and in particular the ones that can influence decision making will understand that there’s a need to get to more people-friendly cities. I live with my family in Amsterdam and every Saturday morning the charm of the city is striking with every place easily accessible.
“Of course more people friendly and more bike-able cities will have a favorable eco-impact. Connectivity will also be a main driver to get to more bike-able cities as it offers locals an easier way of using and choosing the mobility form of choice. This can give a huge boost to cycling.”
Pon.Bike, with an annual production of some 800,000 bikes, is one of the big European makers. This brings challenges when viewing the current supply chain of the industry in Europe. How do you rate that supply chain?
“Adjusting the supply chain is needed. Demand and supply have to match. Now it’s disconnected. Getting the supply chain in order is core to future success. With Pon’s automotive background we believe to have a solid experience and understanding on optimizing supply chains.”
Do you support the current initiatives for bringing more production back to Europe; for enhancing the speed to market?
“We constantly benchmark ourselves regarding our speed to market. We have a clear idea on what is possible. Optimizing speed to market is key.”
Is Pon involved in activities to create more supply chain flexibility and more speed to market?
“We support and are open to innovations in this area as shortened lead times will bring down capital tied in stock. In general you can say that the bike industry must be closer to where its products are sold. Our accuracy in what to produce has to improve. The same goes for our reaction time on market demand in particular in the April to June period.”
Your worked for General Motors and the global management consultancy firm AT Kearney before switching to Pon. Were you involved in automotive and topics like supply chain there?
“From an early point in my career I have been involved in supply chain issues. I am an engineer and worked on the supply side for five years at General Motors.”
Is Pon.Bike with all its brands currently covering all segments and all the main markets?
“We have a global ambition as a group. We have a nice portfolio now with for each segment renowned brands. Of course there are niches like fat bikes for which we don’t have a separate brand. But is that needed; is this a sustainable and commercial viable niche? Such niches make clear that the portfolio needs constant attention. The same goes for the separate brands. Not all brands are currently global. But we can offer the support for each brand to grow. On the other hand not all our brands can turn into global players.”
How do you intend to reach the Pon ambitions in Europe distribution-wise? With importers; with sister companies in all EU countries; with dealer-direct shipments? Does this differ for each brand?
“Yes. Each brand will make its own decision on distribution choices. So it can be dealer-direct or through distributors. Each brand knows what’s best.”
How do you view e-MTBs? Will they be included in the 2017 line-up of Focus or other brands?
E-MTBs will be in the 2017 line-up of Focus as well as Univega. It’s a relevant segment and we will mount a big effort with innovative designs to become leading in this segment too.”
What are your 2020 objectives with Pon.Bike?
“We intend to grow significantly. We have ambitious but realistic plans in place for all brands. Executing them will result in controlled but accelerating growth, in particular with e-bikes.”