2023 saw declining ebike sales volume in many countries, including the United States. This was accompanied by a drop in inferred import volume. To no one’s surprise, this was likely caused by the pandemic induced distortions to the market. The excitement to ride bikes outdoors during 2020 and 2021 accelerated consumer demand that would have happened more gradually in future years. This sudden growth led to distorted signals traveling back up the supply chain, which resulted in a large increase in ebike shipments.
When sales did not keep up with import growth, we saw a period of over supply and a buildup of stock in the United States. The natural response to this is to discount prices to move inventory. This basic economic tenant has two affects on buyers:
- Buyers shift from non-discounting brands to discounting brands, changing market share.
- Buyers who were “on the fence” about buying a bike at that time are convinced to purchase sooner than they otherwise would have. This decreases demand in a future year and increases it to the present year.
Unfortunately, discounting only further distorts demand by reducing future year buyers. Hopefully these consumers will enjoy their Ebikes so much that they will pull in more buyers from outside the market, accelerating overall market growth for an ongoing period.
Back to imports, the supply distortions can be seen in import records as well. Below we see the cumulative imports for each January through April going back 10 years. Early data is limited, but still informative. We can see normal import growth early on, followed by exaggerated growth in 2021-2023 (The over supply period). In 2024 we see April imports 8.6% below April 2023, and YTD imports down 6.6%. This marks the beginning of a period of under supply when viewed at the point of import. The positive side is that this should help relieve some inventory pressure through 2024.
