shopkins1995

I ride a Haibike FS RX (some say the most incredible bike ever created) which replaced a $400 Diamondback 24 speed. I had the Diamondback in my garage just sitting there since I prefered to take my Haibike out. To get some use out of the Diamondback, I decided to change it into an 8 speed bashwich and do do things like twist shifter instead of thumb trigger, etc just to make it a different type of ride.

I spent about $300 changing the bike and I wondered, why are some mountain bikes thousands of dollars? My frame is aluminum and only weighs 5 pounds (I weighed it) so even if I halved it, it would't make much of a difference weight wise). Admittedly the fork was a pogo stick,but I replaced it with a Rock Shox for $130. I have SRAM and Shimano parts. The bike shifts well and handles well. I can't see what more could be done on the bike to make it cost as much as say a $5,000 Giant bike.

I walked into my LBS the other day and saw lots of bikes with crazy paint jobs that made you drool, but in the end they were all triangle frames and built with SRAM/Shimano parts that just don't cost that much to buy retail. I can understand why my Haibike costs so much because it has new technology that is different, but just a plain old bike?

So why are these bikes so much?

hig4s

People are willing to pay it.

JonathanGennick 

There are differences as you go up the pricing scale. Small amounts of weight loss do matter in the right circumstances. Tolerances become better and adjustments are easier and performance - shifting, breaking, etc - becomes crisper.

Sometimes bike industry marketing copy does a poor job of articulating the differences. No company wants to dis its own products, so they write good stuff about all of them.

Sometimes more expensive parts are weaker. Here is a post about a recent example I encountered:

https://gennick.com/the-box/steel-is-real

Returns diminish as you reach the high end of the pricing scale. The leap from $500 to $1500 is usually going to be more noticeable than the one from $4000 to $5000.

elmore leonard

You would have to do some downhill racing with your bike to see how it stacks up with the $5,000 bikes. If your just riding flat pavement, then most 5 speeds and fixies will do the job. Racing is different.

stockae92

Beside the bike that you bought, you are paying for a lot of things.

- R&D for future products
- Ad & Sponsorship to athletes
- Operation cost of the company
- Company expansion
- Company profit

I imagine Ad and sponsorship is a big item, cause like they said in the car industry, "Win on Sunday, Sell on Monday"

And also because the market can support that price. If the whole cycling industry sell absolutely zero (0) bike at $5k, I imagine the pricing structure for cycling products will be a lot different.

People ask the same question about luxury watches like Rolex, and a lot of the times, the answer is "because they can".

DMC707

Is this a serious question?

This is akin to asking -- "Why does a Porsche cost $85,000 when a Mustang cost $30,000 ?"




Have you ridden a high end bike back to back with your Diamondback? (not counting the e bike you also ride- which is a nice machine btw )

Imagine your e bike without the electric assist --- you would have middle of the range shimano components (SLX) , middle of the range Rock Shox suspension and i am assuming an alloy frame
-- thats a $3000 bike right there ---

To that, add in premium components (SRAM XX, Shimano XTR), carbon rims , make the frame out of carbon, and add premium suspension (Fox CTD and the like ) - and your $3000 bike is now a $10,000 bike

It will weigh 4 pounds less and outperform it in suspension, braking and shifting .


Thats a tangible difference that will pay back the rider everytime he/she rides it ----- buuuuuuut -- not something that is a payoff to someone who rides twice a month

The bigger companies do tons of R&D as well on other projects --- If you get a chance, check out a picture of a new Specialized Venge road bike --- Specialized has to sell a lot of "citizens grade" mountain bikes to support the development of the S Works bikes --- I have a sneaking suspicion that their profit margins are also pretty high for the bicycle industry

With a bigger brand like Trek/Specialized you would think that the economy of scale would work for you compared to say, Yeti, a shop that only has 25 full time employees ---- but being bigger means more infrastructure and more corporate nonsense you have to pay for , like middle managers, copiers, printers, computers, plus more sales staff --- plus all kinds of other employees that arent working for tips - working for Specialized is a good job


So there are a number of reasons mountain bikes cost $5000, $8000, $10,000 and now $12,000 isnt an uncommon price and why the hardcore will continue to pony up

hig4s

And the biggest one is that people will pony up. proof? KTM top of the line racing motocross motorcycle $9,799 top of the line KTM racing mountain bike $11,500. There is no way I believe it costs them more to make the MTB than the MX motorcycle.

DMC707

Economies of scale would suggest that they will sell all the "Dungey Replica" 450SX's they make , plus--- whats a good guess on regular 450 SX's and not counting the plethora of woods bikes they make based on the same motor ? -- 2000 450 SX's a year plus 500 of the team bikes ? (and an unholy number of off-road bikes --- )

pics added because pics are fun

I've seen 1 top of the range KTM mtb --- i am guessing in the US they sell less than 50 a year of these guys


--- but they sell a whole lotta these guys'

RIC0

I went from a nice KHS 26er that I built myself to my specs for around $2500 to a new Santa Cruz 29er which I also built myself the way I wanted for roughly $4500 and yes there is a HUGE difference. The suspension in general was a massive change.

osco53

Try getting some, "Air time" on a $400 bike, Or Try fast sweeper or a big chuddery drop with a mean G-out...

Tooling along on the green trails with the kids or riding fire roads on a $5,000 bike Is a Crime IMO...

hig4s

KTM sold 88,000 motorcycles last year and sold 3 million bicycles last year. Part, but only part, of the problem with the bicycle industry is too many middle men. Motorcycle industry is usually manufacturer, distributor, shipper, and dealer. With bicycles there can be manufacturer, local distributor, local shipper, local liaison, overseas shipper, overseas liaison, overseas shipper, overseas distributor, then finally dealer. There can be a lot of people in the middle that add no value to the product but take their share..

Darth Lefty 

Engineering isn't free, and they're made of better materials in smaller quantities in higher complexity than consumer goods.

But still, there's obviously a huge markup.

Darth Lefty 

I don't believe KTM sold 3 million bicycles last year or total ever, the US market is about 12 million bikes a year for all companies. Can you cite a link?

jimc101

Add to the economies of scale, the Moto will only come in one size (per model), an MTB will come in at least 3, possibly 5 or 6, so that even more SKU's to stock = more cost which is passed to the consumer.

jimc101

Found this Latest News not found any for the cycle side yet

DMC707

3m does sound like a very optimistic number -- butthe only thing that might make that accurate is ktm is partners with an Indian company called Bajaj --- they may be pumping gas pipe commuters into India to inflate those numbers.

They have only been importing to the US for a couple years now---worldwide may be something different

hig4s

Sorry KTM was .3 million. World wide bicycle sales has been running 100 million a year for several years. KTM Bike industries sold 1 million bicycles from 2008 to 2012. (.25 mill a year) and sales has increased since.

FrozenK

KTM bicycle and KTM motorcycle are two completely separate companies, and KTM motorcycle also owns Husqvarna so you should add the 90k huskies they sold. Not that the total sales means diddly squat on this discussion. Because I can guarantee you that KTM bike didn't sell 300 thousand units of the 11 grand bike.

What would be relevant here is comparing how many of the 11k bicycles were sold vs. the 9k motorcycle. Because the fact that KTM produced 200,000 units of the cheapest hardtail won't make production of their higher end bicycle any cheaper.

hig4s

The only thing that is relevant is what it actually cost KTM to produce all 300k bikes vs what it cost them to produce all 88k motorcycles and compare that to what they sold for. While you can find the manufacturing costs for motorcycles, you cannot for bike as the bike industry will not let that info out.

Bottom line is the bikes are marked up more because people are willing to pay it.

verdugist

But is the new Shimano XTR DI2 electronic shifting system really worth $4k on a new Pivot Mach 4 Carbon bike? I guess it's like new TV technology like Plasma, it was $10k when it first came out, and then every year the price continues to drop as newer technology rolls out to the marketplace.

Anybody know the profit margins with Specialized/Trek vs. Yeti/Santa Cruz?

Leebo

Shocks and suspension, precision machining, carbon layup, forms, milling, R &D. Production costs, labor, shipping, transportation, import fees, dealer costs and markup, assembly?

calimtb

At this point, the top manufacturers are spending a lot of money trying to shave a few grams and/or a few seconds off frames.

There is a tangible difference, but it's on the order of a few seconds off a typical downhill or cross country course, or a crit or tt race on the road.

Some of the R&D is spent on suspension, such as seatposts, as well as on creating more comfortable frames.

Sometimes, frame stiffness is a priority as well.

You may notice an increase in frame stiffness or comfort, but not the speed differences on a typical training or recreational ride.

Also, these companies spend a lot of money on advertising, marketing, sponsorships, a large pool of employees, and probably legal expenses.

A lot of these innovations do trickle down. A $2K to $3K mtn bike is going to be a great mtn bike, even though top end bikes are $9K to $12K, maybe a bit more now.

LesterOfPuppets

So, you mention Giant, plain ol' double diamond frame, and $5000. Giant has their second tier XtC Advanced for $4600 MSRP.

Frame weights are from 2.14-2.25ish. So that's a lot better than your Diamondback's 5 lb weight. 5 lbs is the kinda frame weight you see for full suspension XC frames, including the shock. 12mm axle is stronger than the Diamondback's. Nice gear range with no front derailleur. Etc.

I dunno what that Giant complete weighs, but Jamis has a $5000 hardtail that's just a hair over 20 lbs. What's the DB weigh complete?

Riding a race-ready bike isn't worth the extra dough to everyone, but it is so some folks.

$300 on the DB was probably a bit of a waste of money. You can get some pretty sweet hardtails for $300 on CL.

I guess the best way to see if $5k bikes are worth it is to ride them. I went out to a Specialized demo day a couple of years ago. Got on a $6500 Epic and that thing was AMAZING. Sooo much faster than my hardtail that sold for about $1000 in 1997!!! Plush on the rough stuff but felt solid when pedaling hard up hills out of the saddle.

dexmax

being a bike shop owner, I get this question a lot..

You can go beyond USD 5000 with any MTB discipline..

To make my answer specific, let's consider AM/Trail and Enduro Spec'd bikes.

A bike that is worth around 3000 will already give you between 140mm-160mm of travel with decent specifications.. however, won't have or will have less premium parts on it.
It is the premium parts that have a marginal performance increase or weight decrease that will make it expensive.
An example will be an XT M8000 crankset that will cost around $150-200 vs a Raceface Turbine which would cost around $250-300, almost double the price. And that is just a small decrease on weight.. Imagine going for Carbon Raceface cranks and you will probably triple the price of the XT. Do this with other components such as the hubs, rims, spokes, stem, handlebar, seatpost, and the total will be a lot.

Another example will be the suspension, i.e. a Marzocchi 350R 160mm will cost around $400 while the 350NCR will be close to $800? The difference will be some weight and some performance..

If you have money to spend, do spend it.. as a bike shop owner, I would benefit more if a customer spends more.. But honestly, most of our sales (and revenue) comes from the cheaper parts that moves faster..

Thanks.

TiBiker

It's like just about anything else. Sometimes there are appreciable improvements in performance as you spend more but sometimes there are not. You can spend $1000+ on a pocket knife that will work considerably better than a $35 hardware store model and there are $250,000 Patek watches that do not keep time as well as a $50 Casio or your phone. The same can be said about cars, clothes, computers, audio gear, firearms, almost any sports equipment, etc. etc.

I enjoy putting bikes together from scratch. Not framebuilding mind you but buying all the parts and assembling the bike. I build my own wheels and pick all components and a frame and then build it up. I did a road bike about 4 years ago and I still love riding it often, and just this past couple of weeks I have put together a mountain bike. I know what I like and what works for me and I plan on keeping these bikes running as long as I can ride them so at 60 YO and still pretty active I can spend that kind of money without worries. The project is nearly as much fun as the riding is.