As we’re reminded daily, times are tough in the automobile industry.
Sales are down, dealerships are closing, both Chrysler and General Motors are passing through government-mediated bankruptcies, and even mighty Toyota has suffered its first yearly loss.
But maybe auto dealers are just selling the wrong kind of vehicle.
Colorado Springs bicycle dealers have seen steady, if unspectacular, growth in their business for many years. The auto industry might be losing brands, but dozens of manufacturers worldwide compete for the high-end bicycle market.
New bike shops are opening, and veteran dealers are thriving.
Nationally, the total value of bicycle sales and related parts amounted to $6 billion during 2008, according to the National Bicycle Dealer’s Association. Sales have increased by nearly 20 percent since 2002.
Like booksellers during the 1960s or auto dealers during the 1920s, the dominant bicycle retailers are small, independently owned businesses.
Although 74 percent of “bicycle units” were sold by mass merchants such as Wal-Mart, this apparently powerful market position only accounted for 35 percent of sales revenue.
More than 4,000 specialty retailers, with a mere 17 percent of the market, collected more than 50 percent of the dollars. They also dominated the market for parts and accessories, and commanded virtually 100 percent of the service market.
Criterium Bicycles, Old Town Bike Shop, Colorado Springs Bike Shop and Ted’s Bicycles were established locally during the 1970s. More than three decades later, these four retailers are still independently owned, and still lead their market segment, catering to serious amateur cyclists.
“We’re not like Denver,” said Criterium owner Kay Caunt. “We don’t have miles and miles of flat, family-friendly bike trails. There’s not a single flat trail in Colorado Springs — so people who stay with cycling want a serious bike, and they come to one of us.”
The businesses are friendly competitors.
“I really regard them as colleagues as much as competitors,” Caunt said, “We all try to be part of the cycling community. We refer to each other; we work together.”
Tom Hoff, a retired Los Angeles policeman, is an ardent cyclist.
“The local shops are great,” he said, “I was riding on the Santa Fe Trail the other day, and I got a flat right next to Criterium. I didn’t have any money with me, but they fixed it, and told me to pay next time I came to the store.”
That type of service is the rule, not the exception.
“That’s what we all do,” Caunt said, “We’ll fix your flats, fit you to the right bike, give you a quick tune-up. That’s why we’re still here.”
Colorado Springs is one of less than a dozen American cities that levies an excise tax as well as sales tax on every bicycle sold, whether new or used. The proceeds of the $4 tax are, by city ordinance, earmarked for bike-related projects.
Last year, local riders purchased 27,866 bicycles, generating $111,464, and this year’s revenue might show a modest increase.
That’s been good for the bike business, since no matter how tight the city budget might be, some money is always available for projects, be they trails, bike lanes or downtown bike racks.
Because of the bike tax, the city has more than 50 miles of on-street bike lanes, 100 miles of urban bicycle trails and 65 miles of unpaved mountain bike trails. n CSBJ