Citing Pandemic Issues, Santa Cruz Bicycles Increases Retail Prices

Santa Cruz Megatower

In a letter shared to an MTBR forum, Santa Cruz Bicycles informed their distributors that they will be increasing their prices by 10% on average across bikes for model years 2021 and 2022. Santa Cruz says that they have increased prices for a variety of reasons related to challenges created by coronavirus. The brand confirmed the letter in an email.

“The global demand for bikes and COVID are impacting Santa Cruz Bicycles in 4 ways:

  1. Increased transportation costs – Since we launched the MY21 line we have seen a significant increase in both the price of air and ocean freight.
  2. Increased component costs – As demand has continued to skyrocket, almost all component brands have forwarded their raw material, labor, and transportation increases to us. We are even seeing an increase in the cost of boxes as a result of the increase in online retail.
  3. Strengthening of the NTD – further driving up material cost.
  4. Tariffs and assembly costs – While there is a new administration in the USA, the continuing trade war means that the 25% import tariffs remain in place. We are also seeing significant increases in labor and factory costs associated with assembly in the USA and mitigating the impacts and risk of COVID.”

Santa Cruz notes that other large brands such as Trek and Cannondale are also facing price increases. “I do want to assure you that we have done all we can to absorb these price increases. We had hoped it would be a short-term issue, but as we look to MY22 we see it’s not and it’s at the point where we are no longer able to absorb the increases on our own.”

Prices are increasing March 1, and Santa Cruz said that all unshipped MY21 orders would need to be repriced for shops. They are not sure whether prices will roll back to normal after 2022.

“It seems everyone’s crystal balls aren’t functioning well these days,” said Brand Manager Seb Kemp. “We didn’t expect to be here so we’re not making any bets on whether suppliers are going to roll back their prices to us in the future.”

The newly launched Rocky Mountain Instinct is another example of a bike that saw significant price increases. A newly revised 2021 Instinct frameset alone is selling for about $650 more than the previous year and generation. Rocky Mountain confirmed that the pandemic has caused similar issues for them in raw material sourcing, labor costs, and tariffs and that they’ve had to raise prices. The build that we tested rose $800 compared to the previous generation.

In January, we wrote about how the “great bike boom” will likely extend through 2021 according to a few brands, and how it’s affected prices for Alchemy and Commencal, as well as challenged shops in getting enough bikes in stock to satisfy customers. Now though, we’re seeing how much these cost increases actually are.

Shipping costs alone have compounded things far beyond the bike industry, and it seems like the end of 2021 is the soonest we can expect things to straighten out.

“No one knows how long the upheaval will last, though some experts assume containers will remain scarce through the end of the year, as the factories that make them — nearly all of them in China — scramble to catch up with demand,” writes the New York Times. They note that shipping costs have nearly tripled for some companies.

The auto industry is sharing some of our pain as well. After several shortage-related shutdowns on the new Corvette, Chevy has had to increase the model’s price by $1,000 according to CNET, although that’s only 1/60th of the price.

For mountain bikers as a whole, it’s probably best to act fast if you’re in the market for a bike this year. With vaccinations on a steady rollout in the US thus far, we can at least be hopeful when it comes to events and maybe even racing this summer.

This story has been updated with comments from Santa Cruz.

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