Shimano sales fall 12% in 2024, but the bike components giant points to “signs of progress.”
According to its latest financial results released today, Shimano’s bicycle component sales and profits declined significantly compared to 2023.
The figures are for the first nine months of 2024, with sales in the bicycle components division falling 12 percent to 253,861 million yen (1.27 billion pounds), while the segment’s revenue fell by more than a quarter, down 26 percent to 41,342 million yen (207 million pounds).
There were signs that the bicycle industry’s ongoing inventory challenges could be heading in the right direction. Shimano noted that “strong interest in bicycles continued as a long-term trend” and inventory levels at retailers “showed signs of progress.”
However, market inventories of finished bikes remained “high”, particularly in Europe, where Shimano blamed “unfavorable weather conditions in early spring” for weak retail sales of finished bikes.
The components giant, often seen as a bellwether for the entire bicycle industry, noted that there are signs that the global economy is showing signs of revival after a “period of stagnation,” although regional challenges remain.
Shimano also pointed to the geopolitical risks caused by the ongoing invasion of Ukraine, “increasing tensions in the Middle East” as well as a “stagnating” Chinese economy that is putting “downward pressure on the economic climate.”
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The bicycle division’s results largely reflect the company’s overall performance: Shimano reported an 11 percent decline in total sales and a one-third decline in operating profit in the first nine months of 2024 (in the bicycle business alone, sales and revenue fell 12 percent by 26 percent). Cent).
The company reported that its sales in North America declined “although interest in bicycles remained strong and the adjustment of market inventories of finished bicycles was progressing.”
In Asia, Oceania, Central and South America, sales were “weak” and inventories were “high,” while personal consumption was “sluggish.” The continued growing popularity of cycling in China brought with it a “favorable” development, although the company’s home market of Japan was also reportedly “sluggish.”
Shimano said the launch of its 105 R7100 12-speed mechanical groupset and 12-speed GRX received a “positive response.”
Interestingly, Shimano reported a loss of 17,074 million yen (£85.5 million) on free inspections last year, following voluntary inspections and replacement recalls in North America for 760,000 11-speed Dura-Ace and Ultegra cranksets, as well as a ” Safety inspection” were announced. in Europe. No figures were provided in the financial results for the first nine months of 2024.
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In a further sign of the turbulent times many cycling companies have faced in recent years, we reported last week that Rapha’s losses had almost doubled to £22.7m last year. UK sales fell 20 percent in 2023 amid a “challenged” cycling sector, marking the brand’s seventh consecutive year of being in the red.
Halfords also announced financial results last week, adding that the UK cycle market remained challenging following “the UK’s wettest spring since 1986”.
