Thursday, April 17, 2008

Feeling gassy?

In recent days, weeks and months many conversations have been had about the current state of the US economy (and the global one for that matter) and the pressures put on Joe Consumer by the high (and climbing) prices of gasoline. Here in California, gas has been over $4.00/ gallon for weeks now and some experts believe that $5.00/ gallon gas will be here by the summer driving months. For stressed out wallets and budgets, that might just mean making some serious decisions about driving habits.

Here's the thing though: the current high gas prices are not the answer to the cycling industry's prayers. Not yet anyway.

US consumers are far too used to driving their cars. They practically live in them. We have all kinds of luxuries built into them. Our cars have become our sense of self for many of us. $4.00+/ gallon gas isn't going to change that any time soon. There are too many barriers to getting people out of their cars and onto a bike.
  • Lack of infrastructure- this one always raises quite a bit of debate, but in many cases people will not ride their bikes to commute- even for a very short commute- if they do not feel safe. Bike lanes are not the end-all answer, but they sure do help and address the major concerns of most people. This infrastructure applies to public/ mass transit as well- many people live far from their work (I live 40 miles away) and need to combine some form of mass/ public transit with their bike commute. Which means that we also need more commuter stations with lockers, racks, etc.
  • Lack of support- there are tax incentives for people to carpool or take public transportation, but none for cycling to work. Plus, how many of us have access to showers at our place of work? Not many, according to most studies I've read.
  • The dreaded retail experience- this one raises a lot of debate as well, but the majority of non-cyclists find the Bike Shop experience to be intimidating or downright unpleasant.
  • The price of gas isn't "that bad" yet. It is going to take gas prices well over $5.00/ gallon to really make people uncomfortable pumping gas into their cars. It will take gas prices, I believe, nearing $10.00/ gallon for us to reach that critical mass needed to tip the scales in favor of more people commuting.
  • The Gub-ment. The price of gas is such a sensitive issue and politically charged enough that it is in the daily discourse of the power holders in our capitol. Even John McCain, the presumptive Republican candidate for president, is talking about putting a temporary hold on the federal fuel tax over the summer to keep gas prices down. Driving is such an important part of our nation's economy that the politicians want to protect driving... not discourage it. The US car makers wield amazing power as well- they have successfully lobbied against legislation to improve fuel efficiency of their cars. We'll reduce federal taxes before we force car makers to improve fuel standards? Insanity.
  • The cycling "stigma". In the US at least, bicycle commuting is still widely viewed as something only poor people, convicted drunks with no driver's licenses or "losers" do.
I see plenty new large vehicles like Escalades and Hummers driving on the southern California freeways every day. The economy may be hurting, gas might be expensive and "going green" may be getting more popular... but people sure do love their cars. And our government likes it that way.

Those folks who are already on the fence, already considering bicycle commuting, might now have the needed incentive to begin commuting by bike. Maybe. An increase in gas prices is not going to be enough to drag the masses out of their heated/ air conditioned, rolling office/ entertainment centers. Not nearly.

There is hope though. There are more bicycle commuters now than there have been since the gas crunch of the late 70's. More and more manufacturers are embracing the product category. More communities are getting behind initiatives to get residents onto bikes. More companies are providing incentives to employees to ride their bikes by supplying lockers, showers and bike racks. The lobbying efforts of the industry and advocacy groups are beginning to get the attention of the check writers in DC.

All in all, things are improving. But... this continued talk about higher gas prices saving the industry from the throws of a bad economy (and rising costs) or being the catapult to move it into a post-Lance renaissance is foolish. We still have a lot of work to do and we still need to find new and better ways to reach out and pull in new consumers (non-cyclists). Otherwise, no amount of high priced fuel is going to save us.

Feeling a little gassy? I know I am...

Tim Jackson
Chief Kool-Aid Dispenser

Labels: , , ,

Posted by Tim Jackson at 9:46 PM

15 Comments

  1. Blogger Gavin Heaton posted at 9:55 PM  
    We have many of the same issues here in Sydney. Governments who are too lazy and too myopic to invest in the future infrastructure of our cities are binding us to our cars.

    But, for me, working from home these days means my car sits idle. Oh, and the commute is super quick!
  2. Anonymous Anonymous posted at 10:25 AM  
    So, uh, masiguy, when's the last time you cycle commuted? Took mass transit? Car pooled?

    You're right. Gas prices aren't that bad, yet.
  3. Blogger Tim Jackson- Masi Guy posted at 10:31 AM  
    Gavin- Yes, it is universal. The US is not alone in this situation, not by a long shot.

    I envy your commute... :-(

    Anon- Very true. With kids, it's a bit harder to use mass transit for me, since I have multiple schedules other than my own to contend with. I don't ride much for work, again due to the kids and the 80 mile roundtrip. But I ride my bike to do the bulk of my around town commuting and buying groceries, etc. I'm no more perfect than the next person... but I'm trying to do my part and encourage others to do whatever they can to do the same.
  4. Blogger James posted at 1:02 PM  
    In my post today, I mentioned the main reason why I bike commute…because it is free riding time. For me, and others like me who absolutely love cycling, saving money is a fringe benefit at best. Of course the people who read my blog or who read this one are already pretty serious cyclists. Telling them about the benefits of cycling for transportation is preaching to the choir to some degree (though I do know a lot of serious cyclists who never actually ride to get anywhere).

    I agree that high gases prices aren’t enough to make most people change habits that are deeply ingrained. The bike industry collectively needs to think about how to make the average person WANT to change those driving habits. Guilting people out of their cars won’t work. Neither will preaching about environmental or health benefits. All you have to do is sell people on the idea that you can offer a better, more enjoyable experience. I know, I know; easier said than done. I don’t have the answer, but I do believe that now is the best time ever to reach out to new potential customers by developing products that are not designed to appeal just to those who already ride. Most of the bikes on the market, even the commuter oriented ones, are really still just geared toward the same old crowd of bicycle enthusiasts. As much as I like cool new bikes, selling me another one isn’t going to do anything to get anyone out of a car. It is going to take a different way of thinking.
  5. Blogger Tim Jackson- Masi Guy posted at 1:11 PM  
    James- Amen brother.

    Selling the relationship of fun and staying away from guilt is the way.

    Getting away from the usual consumers we already sell to is very important.

    Now truly is a great time to build things up.
  6. Blogger darren posted at 4:21 PM  
    Tim -- you quite fairly mention the in-store experience as intimidating to that potential commuter or practical user. We are working to turn ourselves around, but it's hard, and we're probably in the minority.

    But how about the bike brands? Who is doing the research on end-user preferences to create that bicycle "Model T"? What bicycle brand, besides Breezer or Electra or a few other niche players, doesn't at least partially rely on the crutch of the aggro-enthusiast racing culture, or the spec-tech fixation?

    Brand-building in this industry seems often to involve little more than picking colors, forking over bikes to teams, and passing through cost increases, IMHO.
  7. Blogger Tim Jackson- Masi Guy posted at 7:49 PM  
    Darren- Good points. I can't speak for any other brand other than the one I work for, but we do try to do our best to design "real bikes for real riders". Some design does happen in a slight vacuum, simply because it's impossible to be everywhere at once. That said, development always has some element of rider input and feedback.

    As for the comment about "passing through cost increases"... what else should a manufacturer do? Bike companies, at least the one I work for, operate on painfully thin margins. If the current round of price increases was simply absorbed without a price increase to the retailer and consumer, we'd go out of business... and quickly. As mentioned in previous posts, these increases are far from unique to the bike industry. Prices are going up across the board in nearly every segment of the economy. Bike manufacturers are no different. We have to survive somehow... at least I hope we survive.
  8. Blogger darren posted at 10:03 PM  
    Tim -- "real bikes for real riders" is great, and you guys do a fantastic job at it. But "real rider" to me implies "experienced cyclist."

    My rhetorical plea, who's designing "desirable bikes for rookie riders?" Perhaps it's more a challenge to the big boys, but i'm waiting to see evidence of somebody (besides the Coasting folk) plowing cash/PR/best-talent into offering the killer sub-$500 bike, rather than firing all their bullets on the $5000+ ProTour rig.

    "passing through cost increases"... what else should a manufacturer do? -- realistically, short-term, nothing. Biz is biz. But the public industry line is to glumly accept these increases without much talk of long-term workaround or improvement.

    There's no public talk of seeding and standing up alternative global sources, no cohesive efforts to streamline the domestic supply chain, etc etc. No apparent corrective action, at least as seen from my lowly perch.

    Correct my ignorance and seditious notions, industry vets. Please.
  9. Blogger Tim Jackson- Masi Guy posted at 7:19 AM  
    Darren- Again, I can only speak for my own brand, but we are developing less expensive bikes all the time. In fact, the bulk of my line resides below $1000. Sure, that isn't sub-$500, but with pricing pressures, that becomes harder to do anyway. But the industry isn't without such bikes- Kona and their Africa Bike are a perfect example. The development of inexpensive and practical bikes is not dead, but the market hasn't matured enough in the US to support it very well. Previous attempts to develop such bikes have been less than fruitful. But change is in the air and things are looking better to support such a product offering.

    On the topic of the price increases, etc, it's simply global economics. There are less expensive sources, but they are less favorable- either politically or because of quality concerns. Making a bike cheaper, to fight the rapidly rising costs, does no good if the quality is very poor or the product is hit with massive tariffs or is met with public opposition.

    The cost increases that are coming are anything but short-term from what everybody is being told. All the experts are saying that this is a real and likely permanent change in pricing globally. Material costs are going up- regardless of country of origin. I know that the company I work for is not poised to absorb those cost increases and see if things "go back to normal". At our size, it would be totally irresponsible to even try.

    The global bike industry is in the painful position of passing along price increases for the first time in many years. And the increases aren't likely to stop any time too soon either- I have been seeing further increases from vendors. Some vendors have given us 4 price increases since January. That, to my knowledge, has never happened before in this industry. Companies have to make money to stay in business and bike companies work on very low margins. If those margins are entirely eaten away by absorbing rising costs, then companies face the very real possibility of going out of business.

    Honestly, all of your points are very valid, but the realities facing the industry are very stark and painful. There really is no "US supply chain" to speak of and what does exist is very expensive. Again, another source of cost increases. However, if you present a better value proposition with that more expensive product, then you might have a chance. Some companies have done that fairly well. A small example of that is the recent boom in small frame builders. Nothing makes me happier than seeing a healthy bunch of small builders growing in popularity.

    There is hope for the industry and the US cycling public is maturing. New riders are coming in, slower than we'd like, but they are coming. The US public is beginning to see benefits to cycling- going green, saving money, improving health, having fun, etc. I do personally believe that the industry will weather this storm and hopefully come out of it even stronger in the end.

    I hope anyway.
  10. Anonymous Anonymous posted at 7:44 AM  
    in the uk its the equivelent of $10 a gallon most people still drive apart from in huge cities where traffic is too bad/just completely impracticle...
  11. Blogger Tim Jackson- Masi Guy posted at 7:57 AM  
    Anon- Amazing, isn't it? Due to car problems, I am carless today and part of tomorrow, so I am forced to live my own utilitarian dream. I have several bikes in my small apartment and I am looking forward to hauling my daughter around on her trail-a-bike to run our errands today. But I know that in the US at least, I am in the minority.

    Momentum is picking up- I know it is- but the "masses" are not there yet.

    I know that things in the UK are getting better as well. It would unrealistic to suggest that the tide is turning, but things are improving greatly.

    Thanks for the comment.
  12. Anonymous Len B posted at 12:55 AM  
    Here's a potent combo; I've been car free most of my life so it's part of my lifestyle to get a new pad, job, etc. that support my choice.

    But when I bought my partner her bike, it was amazing. First, she paid for the $700 purchase price in gas savings alone during the first 3 months. 15 mile RT commute 3 days a week, and 19 mile RT 2 days a week. Second, her car insurance dropped by over 100 dollars annual. Plus the fitness aspect (she's fit, but not everyone is and weight loss comes naturally with increased exercise) as a fringe benefit to saving money puts a 6 month car to bike program into a very attractive light. Just add up the dollars, and tell em $1000 dollars down, you can quit your diet, save money on insurance, stop paying $4.50 a gallon for gas, and end up with dollars in your pocket.

    Just needs the right kind of marketing spin to get into the mainstream. Anyone in the media biz?
  13. Anonymous polkadot posted at 1:24 PM  
    just stumbled onto this, excuse the late commentary but I am intrigued to hear a bike marketer's perspective

    I think safety is the elephant in the living room when it comes to bike commuting

    I'm now in marketing too - building automation systems. I spent 10 years doing environmental advocacy when I was younger. I bike commute regularly, and volunteer time to help expand high school mountain bike racing (Norcalmtb.org), so I think I kind of understand what bike marketing is up against

    Those who can afford to choose a mode factor risk into the economics. If they accept the risks then family and/or work commitments often make commuting too slow, unpredictable, or untimely

    I ride about 600 miles/month on "bike friendly" roads in "bike friendly" country (San Francisco bay area), but I expect close encounters with traffic on any ride, whether it's fun or commuting

    Drivers range from well intentioned but inadvertently dangerous, through distracted and/or inept, up to hostile idiots.

    My own riding sometimes creates risks too (going fast, running stop sign, cutting a corner...)

    Even if everyone drives like a saint and I ride within my limits I may still tangle with a car due to a blowout, equipment failure, bee stings, or who knows what.

    Bottom line = if a vehicle hits me I lose. How much is that worth?

    Other little bike commute negatives include (i) finding bathrooms (ii) traffic controls that do bikes no favors, and (iii) no showers at the office

    On a related angle, my parents can not understand why I won't use the multi-use bike paths which cover about one-third of my miles. For me (a) 15 mph limit is too slow, (b) the surface is pretty bad, and (c) paths cross roads without right of way, creating more safety issues

    Drivers may even resent cyclists being on the road if there's a bike path available. Bike paths cost a lot of money, but at least around here the constraints of good etiquette on multi-use paths typically don't favor bike commuters.

    Rhetorical questions:

    Can drivers share roads safely with bikes?

    Should cyclists be granted more right of way so it's more time-efficient to bike commute?

    What would get experienced cyclists to try commuting 1 day a week?

    What small incremental changes would best support more bike commuting?

    Thanks for the interesting forum, do keep on blogging

    ps. I bike commute 2 or 3 days per week, 30+ miles each way
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