News Update by Stefan Vollbach
In our magazine, the CEO of SIMPLON speaks about current events, challenges in the bicycle industry, and news from the head office. Find out more now!
News from the bike industry and insights from SIMPLON CEO Stefan Vollbach
Good news: The wheel keeps on turning!
It's no secret: Numerous industries are currently affected by supply chain problems. It’s primarily the automotive industry and the timber industry that are in the media spotlight. But what many people don't know is that the bicycle industry is being hit hard as well.
Stefan Vollbach gives us an update on how lockdowns, bottlenecks and difficult political situations are currently affecting the bike industry. The CEO of SIMPLON also speaks about the current situation at SIMPLON. Last but not least, he reveals when the new Experience Centre will open its doors.
Supply chain problems in the bicycle industry
Last year's pandemic left hardly any sector of the economy unaffected, and bicycle manufacturers weren’t spared either. The demand for bikes has continued to rise. In Austria, 496,000 bikes were sold in 2020 – the highest market volume since surveys began. While dealers can be pleased about this, manufacturers are left furrowing their brows. Due to repeated lockdowns, production facilities had to close, and this was the beginning of capacity problems along with ever-growing backlogs.
Currently, the short-term exaggerated demand for bikes has improved slightly, but the demand remains very high.
Current challenges for bicycle component manufacturers
The never-ending lockdown in Vietnam
The frames of SIMPLON bikes are manufactured in Vietnam. Despite the high motivation of the employees, it is currently not possible to work at full capacity. The reason: A month-long lockdown has put a spoke in the wheels of production. Despite Covid tests and although no positive case was detected, the site had to be closed. Before the closure, the entire workforce was given the choice of either staying at the plant for the duration of the lockdown or spending the entire period at home.
200 dedicated employees out of a total of 700 showed ultimate commitment during this difficult time. Now the situation has calmed down a bit, and lockdown rules were eased. However, it will probably take until December before all 700 members of staff are allowed to return.
Energy crisis: no power for China
At the site in China, the entire workforce was able to work at full capacity but without electrical support. The reason for this was the energy crisis, which caused the power to be cut off. While initially there were two days a week without electricity, the number of days without power rose to five. As a consequence, diesel-powered generators were purchased as an alternative.
Another problem in China is the lack of carbon. Due to tense political relations in the country, procurement is only possible via complicated detours, which means that longer delivery times have become the norm.
Current working life at SIMPLON
The events on the world market naturally also affect SIMPLON. Nevertheless, production is going well – thanks to the entire SIMPLON crew. Our employees demonstrate their talent for improvisation on a daily basis. The goal: to avoid delays or to keep them as short as possible, at least.
Another challenge – of the positive kind – is the current (temporary!) halt on orders. The culprits in this case are the dealers, who are just as excited about the new products for 2022 as our customers. However, in order to give the team time to carefully process the high order volume, customers were temporarily not allowed to place any new orders.
Happy end: The new Experience Centre in Hard opens in 2022.
Last but not least, Stefan Vollbach talks about the structural developments at SIMPLON, which have been underway since April 2021: Around 90 metres (as the crow flies) from the production facility, the new Experience Centre is constructed. In the future, departments such as development, product management, marketing and sales will relocate there. At the same time, the existing production is being optimised.
The new Experience Center will open its doors in 2022. What can visitors expect there? Among other things, a 3D body scanner. It allows riders to get optimal measurements for the individual adjustment of their bicycle setup. You can read more about this process in our article on body scanning.