UK Market Sees Strong Growth in High-End E-Bikes
LONDON, UK – The number of bikes imported in the United Kingdom seems to have undergone a staggering transformation throughout the course of 2017. During the first two quarters it looked like they were on course to post an annual drop of between a quarter but they bounced back to post year-end sales of 3.1 million unit.
Compared to previous years totals of 3.6 million in 2014, 3.5 million in 2015 and 2.7 million in 2016 it seems like the downward trend has been turned around. As around 95 percent of bicycles sold to UK consumers are imported import figures are a key indicator of the health of sales of new bikes in the UK.
E-bikes: shining light
The shining light of the UK bike industry over the past few years has however undoubtedly been e-bikes. The official government HMRC import figures for e-bikes have been largely recognised as not reliable in recent years. HMRC realised this and for 2017 introduced a more narrowly defined commodity code that more accurately reflects legal electric bikes. The UK’s Bicycle Association has welcomed this change. This means inflated figures for e-bike sales look to be a thing of the past and the HMRC figures of e-bike imports and arrivals of around 62,500 looks like good news for the industry. Industry guestimates for 2016 before the arrival of the new more accurate commodity code gave an upper figure of 50,000. So by combining the anecdotal with the actual evidence we can postulate a minimum year on year market growth of around 20 percent from 2016 to 2017. A bit more worrying was the drop in the value of bicycle imports in 2017. Despite the growth in units this had actually declined from around GBP 380 million (427 million euro) in 2016 to GBP 377 million (424 million euro) in 2017. The value of 2017 e-bike imports based on more accurate 2017 data was GBP 37.6 million (42 million euro) – around 10 percent of the value of the total imports, despite the fact that they made up only 2 percent in terms of imported volume. However, all in all, the figures show a relatively healthy picture and certainly one that has defied worries based on the cost implications of the weak pound following the decision in 2016 of the UK to leave the EU. Of course the big question is the whether the UK will continue to be able to trade tariff free with the EU and the effect a final decision on this might have on the UK bike trade.
“The higher end, the stronger the growth”
KTM distributor Fli’s confirmed this positive picture and suggests that the size of the supply chain itself may be a problem. Fli’s Col Williams commented “the higher end, the stronger the growth. We are selling good volume at retail prices between GBP 2,000 (2,250 euro) and GBP 3,000 (3,375 euro) but our GBP 4,000 (4,500 euro) was sold out at first. GBP 2,500 (2,810 euro) is the average but its skewed massively by availability, not demand.”
At the very top end of the UK market is Riese & Muller who for 2017-18 are selling via their own employed representative Dan Jones. “Feedback from dealers shows that e-MTB has seen a good growth, but I think the bread and butter will always be commuting bikes. E-Road bikes won’t pick up unless the speed is increase from the 15mph limit. Price does not appear to be the question when purchasing a Riese & Müller, the important factors are quality and comfort, our average price would be around GBP 3,500 (3,950 euro).”
Chains continue their rise
Halfords-UK continues to dominate bicycle sales. Statista website shows that from 2016 to 2017 it increased its UK market share from 24 percent to 26 percent although t’s not clear if this includes e-bikes. By contrast Halfords claim around 10 percent of the bike repair market and around 15 percent of the parts and accessories market. Halfords most recent figures show a 3.9 percent increase in cycling revenue for the 41 weeks to January. The jury is still out as to whether Evans Cycles, which runs 60 branches across the UK, has continued its poor performance from 2016 when it saw a drastic 58 percent drop in operating profits in the 12 months to the end of October of that year. Other chainstores that retail bikes include French-based Decathlon and GoOutdoors, both of whom appear to be gradually expanding in the UK market with a small but steady list of new store openings throughout 2017 and early 2018. There has been a definite slide in the number of IBDs in the UK although official figures in the public domain are hard to pin down.
E-bike retail: specialist or mainstream?
E-bike retailing presents a particularly mixed picture. No doubt most of the volume is at the lower end of the market still, dominated by budget models from the far east. However, the evidence presented above shows a premium market with strong growth. The HMRC figure of e-bike import and arrivals figure of around 62,500 quoted above includes well over 16,000 from within the EU, which tends to be the source of higher priced premium e-bikes, from which it could be assumed that ‘quality’ e-bikes make up around 25% of the UK market. Specialist e-bike retailers still have a strong foothold in this particular sector, despite the likes of Halfords strongly pushing higher quality e-bikes and more and more IBDs looking to e-bikes to provide a financial lifeline in a difficult market.
The likes of 50 cycles and e-bikeshop have seen recent branch expansion and there have also been 2018 e-bike only store openings in London (Velorution – whose other London stores carry a mix of conventional and e-bikes) and Glasgow (Love e-bikes) to name just a couple. These are not just bricks and mortar operations however. Many have strong online selling operations with live chat and sales agent websites and the bigger operators also run specialist try-out days at outdoor locations such as forest parks in order to give the general public a taste of that the bikes can do in challenging terrain. There’s also a recent trend to broaden their offering, with e-scooters and e-mopeds appearing in some shops.