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The Spokesmen Cycling Podcast
EPISODE 255: Canyon Creates Concept Car (And Releases Utility e-Bikes)
Tuesday 1st September 2020
SPONSOR: Jenson USA
HOST: Carlton Reid
GUESTS: Sebastian Wegerle, Jack Noy and Roman Arnold of Canyon.
MACHINE TRANSCRIPT
Carlton Reid 0:14
Welcome to Episode 255 of the Spokesmen cycling podcast. This show was released on Tuesday, first of September 2020.
David Bernstein 0:24
The Spokesmen cycling roundtable podcast is brought to you by Jenson USA, where you’ll always find a great selection of products at amazing prices with unparalleled customer service. For more information, just go to Jensonusa.com/thespokesmen. Hey everybody, it’s David from the Fredcast cycling podcast at www.Fredcast.com. I’m one of the hosts and producers of the spokesmen cycling roundtable podcast for shownotes links and all sorts of other information please visit our website at www.the-spokesmen.com. And now here are the spokesman.
Carlton Reid 1:09
Canyon makes bicycles. Very nice bicycles. They’re ridden in the Tour de France but the German brand doesn’t just make high-end road bikes it also makes gravel bikes, mountain bikes, e-bikes, fat bike and city bikes. It also now makes cars … sort of. I’m Carlton Reid and today, 1st September 2020, I’ve written an article for Forbes.com that explains how and why Canyon is getting into the car market. The concept electric car that’s unveiled today is a lightweight, skinny, Human Powered Vehicle that almost but not quite fits in the microcar class. The car has to be pedalled and it’s a cycle with a roof on it really. Now, as the author of Roads Were Not Built For Cars, a book which explores how 1890s bicycle companies made the first cars and morphed into automobile companies, I really enjoyed talking with Canyon because this is potentially a history-repeats-itself story. On today’s Spokesmen podcast I chat, remotely, with Roman Arnold, the founder of Koblenz-based Canyon but first up will be Canyon product manager Wegerle and Canyon UK marketing manager Jack Noy. All three guests — and graphics for Canyon’s concept car — can be seen in the flesh on a half-hour video I’ve placed on YouTube. This audio version is longer than the video because I’ve also included bits where and Jack talk about Canyon’s new electric bikes. And Roman talks about e-bikes and how Canyon has fared during the bike boom. Here first are and Jack talking about Canyon’s new e-bikes including one festooned with fenders and luggage racks.
Carlton Reid 1:44
It’s Jack up first. And then Sebastian, who’s got a bit more of a German accent, coz he’s German, is following him.
Jack Noy 3:24
We have had hybrid bikes, but they they’re quite performance focused. And now we really wanted to blend the technology we learn from having World Tour teams racing bikes with real practicality for everyday everyday use.
Sebastian Wegerle 3:39
So yeah, we will share today our thoughts and motivation, why we want to contribute to maybe solutions for urban mobility. And we also want to share our thoughts about it. And then we want to quickly introduce you to two products that are will be useful Available beginning of next week, and an idea that might be available later on. So now we start with a first product that we will launch next week, the light ebike. So the objective was, as mentioned, to build a lightweight bike to not have any compromises. Um, so, building a lightweight bike is quite easy because you can just easily get rid of all the features and a very lightweight bike, but it’s not very practical and functional. Um, so we said we a car.
Carlton Reid 4:34
I can’t quite see that weight. It’s very small. What’s the weight?
Sebastian Wegerle 4:37
17 kilogrammes. We do know that there are bicycles with 15 kilogrammes, but we have a powerful motor. And we have the full functionality and this is for us to be very sweet spot between minimal assists super lightweight bikes that are very close to normal bikes, and the gap between the and the high torque bikes that are more 2425 kilogrammes, we think with the 17 kilogrammes. We have something that still we are able to carry it upstairs downstairs. It rides like a normal bike. But you have also the ebike experience of the strong push, do
Carlton Reid 5:09
you have any hurdles you have to go through? When you send an electric bike through the post is anything different from sending an ordinary bike any regni regulations, what’s
Sebastian Wegerle 5:22
the there are regulations usually we send actually we send our normal bikes we send with the post in Germany normal with the bikes there is it’s a it’s a weird situation. As soon as the battery is installed, it’s not a battery, it’s more complicated to send a single battery than sending out an E bag theoretically, because the big the big providers, they say of course if you have plenty of ebikes on your truck and you have an accident, it will behave like you had a lot of batteries on it. And therefore this is we always distant with spedition This has another advantage because if we send some another back in the with with as a package, we have to keep a certain form factor. So we have to pack it in a very small box yeah I would say and with with this position, I mean you can have to live with a fridge for example. So the contract is much, much more flexible. And this is a benefit that we take so for example, we we assemble the bike fully and we only take out the front wheel and seat both, so it is more or less in five minutes is ready to ride. And because we have this this allowance with this petition, we have different different opportunities as well of course at higher costs and market because
Jack Noy 6:52
the customer doesn’t see because unless it’s like free, great service but the box is much bigger and And it’s just great like, take the top off the box and the mud guards even already attached and like protected, it’s just slotting the front word and so again like if we’re trying to bring people to cycling everything needs to be easy not just the writing experience but also the purchasing and assembly experience. And yet in some ways, especially said the batteries are a nuisance, but in other ways they open open doors for us. Cool. Let’s um, let’s get into the next one, which again is this is an established mobility user case. Someone that needs that versatility to maybe toe something maybe to write a little further maybe to add another layer of practicality in terms of carrying capability. So yeah, hi torques This means with a with a powerful motor and yet, please have practical features so proceed on the city is yours to proceed on is is a new bike for us we’ve no need to proceed or proceed on in the past the bike has a carbon frame and I think looks fantastic but also Yeah, plenty of practical features.
Sebastian Wegerle 8:22
Yeah as I said, I mean this is coming from the community which is wireless and functional This is just adding on everything I mean you have more more than required more or less right you have 85 newton metres multitenancy strong enough to push a mountain bike up the steepest climb, have it in the in this urban bike and you have the trailer mount, you have like with high beam to really have the best visibility and record mudguards and all of these features integrated into this iconic silhouette which is More or less the successor of our very first urban bank where we also had the approach to integrate everything and have very clean silhouette.
Jack Noy 9:07
You remember that one Carlton, and here’s 2015 2014 with the that top tube that blend into the stem and the light integrated system as well. So yeah, that’s the DNA kind of passing through into this pipe.
Sebastian Wegerle 9:20
So, as I said, it’s it’s good to have all the features and have a most enjoyable ridng experience. And also the flexibility so compared to a cargo bike where you always have your, you always have the station waggon and the big trunk, you can easily adjust to whatever you’re up that specific date. If you’d like take your children to the park or to the kindergarten, you attach the trailer. If you just had him for lunch to the city centre, or to the office. Then you have a normal bike so you’re very flexible and cover multiple scenarios. On the top spec. We have combined the Bosch perform cx high torque motor with the envio low automatic shifting and the gates belt drive, which means that we have found more or less the perfect match between a high torque and low maintenance. And with the new 85 newton metres uptake you have more than sufficient talk to really pull off a trailer even in a in a climb from zero and with the with the belt it’s I mean the car and bike is there standing outside for 23 hours a day so if it’s raining, you are actually nowhere on a belt. This is Pacific advantage. Um, these are the features so you see multiple luggage solutions you can instal a front rack where you can put your hand back or you can put your arm is fierce Or when you go to the bakery in the morning at the croissants. You can pull the trailer and we have
Carlton Reid 11:08
Are they proprietary or they have a third party design.
Sebastian Wegerle 11:13
Yeah, yeah.
Jack Noy 11:14
Yeah the rear rack is is a is integrated with the fenders. So that’s also I guess us but the pannier compatibilities the ORTLIEB quick, like quick lever is it quick lock quick lock on one.
Sebastian Wegerle 11:30
So it’s very easy to attach the off the backs and to take them off, but we think that also um, the other one, I think the benchmark product when it comes to cycling bikes, but if we, if we talk to people, they don’t necessarily want to have a second back as their bag right. So sometimes it’s easier for grocery shopping to just use your your normal bag or you have a rucksack or you have your office back. And therefore we did this, this baskets that you can attach in this very same interface. And then you can just put in whatever you like, right you can put in your yoga yoga mat, or you can put in your gear. So everything and I think we think that’s quite convenient. So we have these three different approaches when it comes to luggage, then set the light, quite important and comfort to also have this pcls
Jack Noy 12:27
you know, the seat post from before carton, the leaf sprung Canyon seat posts. It was originally developed with a gun, as I guess kind of like a partner of ours due to the family connection. Great. And then I know we went through these that beginning but now on to the final user scenario which hasn’t been covered yet. So
Jack 12:50
this is where we we are concepting so I
Jack Noy 12:55
guess it’s the first it’s a first kind of pitch of bringing this idea of out into the open for feedback. And then from here, taking, taking the next steps to making it making it a reality. So yeah, pure concept.
Sebastian Wegerle 13:12
We think there’s a gap between the car and the bicycles. And we want to bridge this gap
Sebastian Wegerle 13:18
somehow.
Sebastian Wegerle 13:20
Um, so first of all, there’s a gap in the two different speeds and the two different infrastructures very much depending and I do fully understand it’s not 100% applicable to UK, but in most of European countries, you do have the two infrastructures and it looks like you always have different capacity left in the two infrastructures. So when you write from this from the suburb towards the in the city, most of the time there is a fair chance that streets are still not blocked. So right there and do
Sebastian Wegerle 14:01
so using
Jack Noy 14:03
suburbia into city, the first part of your trip, maybe not so much these days, but the first part of your trip is hopefully fairly free flowing B roads or single lane a roads. But then of course, there reaches a point as you get to the centre where congestion is, is too much. So,
Sebastian Wegerle 14:25
yeah, and then most of the time there’s the bicycle infrastructure is not occupied yet and there’s the capacity left so you can just switch and move to the bike lane and continue there and operate the vehicle as an E bike. So this is the idea of the two modes, so you have 60 kilometres per hour. You can be part of the traffic not blocked traffic when you’re riding on the streets, and then you can switch to the evac mode and operate the vehicle on the cycling lane. The biggest reason in this in this survey I think it was can see that we read was why don’t you use the bicycle for your daily commute? Because it rains in the neck get wet. So, too, you
Carlton Reid 15:14
don’t have a roof.
Sebastian Wegerle 15:16
Yeah, exactly we have to, we have to provide full weather protection.
Sebastian Wegerle 15:21
And therefore we have this closed capsule concept. So whenever it’s raining, it’s raining you’re fully protected in your capsule and you’re safe and dry inside. But when the sun is shining, you want to have this bicycle feeling which is the as flowing through your hair. You can hear the birds singing and smell the bakery next door. So they open the open mode is then both giving you this this cycling experience and everything that is nice about cycling, but also Solving the heat management issue because then you have the wind going in. And it’s not that you’re locked in this capsule, and it’s heating up and heating up and you’re getting bought, you know,
Sebastian Wegerle 16:09
in the greenhouse.
Carlton Reid 16:10
Yeah. So this is this is this is the microcar segment. This is gonna, that’s why it’s called a microcar. It is,
Sebastian Wegerle 16:17
yeah, Light Electric Vehicles. But it’s, as we have this dual mode. And I think this is for a lot of infrastructures, this is the best concept because you can use both infrastructures. And so it’s really bridging the gap between the bicycle and the car. Because we have these these light electric vehicles like Renault Twizzy. And this is actually the legal the legal category category that we are in they’re in this 60 kilometre per hour mode. But when it doesn’t change any thing too good if you’re stuck in the same traffic, just sitting in a smaller vehicle there, right? The moment
Jack Noy 16:55
The dimensions we’ll get to, they’re built around existing cargo bike dimensions which will we’re aware. Again not probably not so much for London. Oh, well UK is quite unique case but for a lot of Europe, cycle lanes are relatively wide and cargo bikes seem to operate just fine and it does seem that when cities are considering new bike lanes they are thinking about cargo bikes that they should you know they should be able to work
Carlton Reid 17:27
Is this narrower than the Twizzy?
Sebastian Wegerle 17:29
Yet 80 centimetres only between 70 and 90 centimetres wide, I would say. And I think they’re in some countries their regulations where you can have been wired in one metre. So design I think, both for product and the concept. Very important because it helps you to generate acceptance. I always bring in the example of the Renault twizy. I really liked it, which was a really big fan of the little PC, but a lot of people think Look, it looks awkward or the the BM w c one which was the scooter with the with the roof and and this leads to a lack of acceptance to really check out this concept and idea in a more detailed level and therefore we think that especially with concepts we have to go all in with the design but also with with our products, but it is not only about having a very attractive product but also already considering aspects like easy to produce easy assembly from the very beginning. So you see there also with the capital concept it could be injection moulded and carbon fibre reinforced plastics. And then you have two big tools to produce the main parts of the of the vehicle already.
Carlton Reid 18:53
Do you see this is mail order still. Do you see this as you send this in the post or is this you’d have to have a dealer network
Sebastian Wegerle 18:59
We don’t think that we have to have a dealer network because we think we’re facing more or less the same challenges in our service contact with we do see a trend to serve as partners, either bike shops or mobile service partners. Not only to solve these specific challenges, but also to solve the service challenges on all of our bikes, right. And also design wise we focus already on low maintenance. You see, it’s still pedal operated. So you you’re pedalling in numbered style, which whichever mode you are, but you two to two packaging reasons and also maintenance reasons. We don’t have a mechanical trifle from the, from the pedals to the motor, but it is electric so you’re pedalling into a generator to either when you’re in the car mode and generate a signal that is reinforced with the energy from the battery to go 60 kilometres per hour or in the pedelec mode up to 25 kilometres, also adding additional power from the from the battery. But if you want to go fast and you pedal pedal hard enough, then you generate so much energy that you can go faster than 25 kilometres per hour. And you just have a wire and no wear at all em in this in this drive train.
Jack Noy 20:24
No mechanical function just just electric and then I don’t know if we forget it, but there’s like energy that energy recovery. Yeah as well I think a cool point and important. So you know how fast recumbent bikes can go downhill carthon this is limited to 60. But with a decent Hill, it’s 100% something that’s aerodynamic with this minimal, you know, frontal area to go pretty fast. So the idea would be to have like a current system in place which limits the speed to 60. And while doing that also So we recharge your battery, like, I go into my situation.
Carlton Reid 21:04
Yeah, so this is like it’s a cross between a micro car and an HPV. So the human powered vehicle like the Mike Burrows of this world who’ve been, you know, championing them for a long time.
Sebastian Wegerle 21:19
Exactly. And with facing the same challenges as an HP V, human powered vehicle, so you have the nice moving in the exact same area where you usually have the steering wheel, right? So you have to come up with a generative solutions. And also getting in and getting off the car is is a challenge. So what we have here is you see the two the two seats, and when you open the roof, you can access the car. Like, like a bathtub, it’s exactly the same height. So it’s it’s a deemed norm in Europe, for the height of a bathtub, we have very similar height of the bathtub on. In addition, you can put your hands here on the on the top. So it’s easy to have the access when the capsule is fully open. And if you want to store something on the in the rear either your child with the size of the one with the 50 or boxes, whatever, you can slide all seats to the front. And then the rear seat is in exactly the same position as the rider seat here in the picture and you have access to top on very easily and then you slide it back and you can jump in the car. The steering wheel as an as mentioned we we we had to change the steering concept. So it’s more it’s now like a choice stick concept on a tank, tank steering on the left and the right side. So you have two sticks and you also operate the brakes in this area. And then you you just snap in your smartphone in the middle and as your hmm To get all the information required and to operate the system,
Carlton Reid 23:04
How many wheels?
Sebastian Wegerle 23:06
Four. Four is the most stable option also for cornering.
Carlton Reid 23:15
And then you show me before had the roof comes away. But when the roof is closed, how are you getting air into the rider to stop the sweating?
Jack Noy 23:27
A grill in the front still and cabin vents.
Sebastian Wegerle 23:32
And the presumption is also that you close the cabin only if it’s raining some key facts so it needs to be lightweight to be efficient, right. So we’re looking at 95 kilogrammes. The form factor is an 83 centimetres wide and only a bit more than one metre high and two metres 30 long. The range is 150 kilometres not because we expect people to travel on holidays with this vehicle but to have a very convenient charging cycle so you don’t have to charge every every day on a daily basis
Jack Noy 24:17
like combined range so a mixture of 16 and 25 so for sure if you used it in 25 then you go a fair bit further than 150 but if you burn around at 60 kilometres an hour then your range would would drop a little bit as well.
Sebastian Wegerle 24:35
So and possible price we have to offer this bike This is this vehicle somewhere between five and seven half thousand euros which is and if you look at the entry level cars I would say it’s you. Dascia and the small Volkswagen they started nine and a half something like this. happen advantage. You have it cheaper price. And you’re also your position in between premium ebike with the additional benefits of this concept, and the
Carlton Reid 25:07
car. The first cars were made by cyclists. So even Benz, his car was 75% was from a tricycle shop in Frankfurt, in fact, so the wheels, the everything on there was was from a bicycle shop. And then all of the capital, the manufacturing technologies that people transferred directly from cycling into early motoring. So when I do this story on Forbes, it’s going to be very much along the lines of, you know, this is this is there’s a historical precedent here in that bicycle manufacturers have have very often gone across and made cars. It’s kind of you know, something that the technologies are actually very similar even though we think of Cars and bicycles as two different vehicles. They are very very similar in many many ways.
Sebastian Wegerle 26:07
Yeah and it’s just and and we we don’t have any ambitions to go the next step and the next step in the next step and then end up building cars that we think might be a problem.
Carlton Reid 26:18
The current situation, this is what happened so rover you know rover, Land Rover and that started as the rover bicycle. So Rover bicycle company, transformed itself into the Rover car company and then forgot its bicycle roots.
Sebastian Wegerle 26:35
Definitely. And I think this is, this is this is the change in the mindset that I mean we cannot solve the issues if we still stick to the most comfortable seat heating and air condition and the best Dolby Surround system and as much leather as possible and big motors, and then we cannot we have we have to make compromises in comfort. But the good thing is, as we said in the beginning, we have also by making sacrifices in the comfort, we will gain additional life quality by saving time saving money and having a better environment. And I think this is I mean, we start with this mindset, this is a different this is a different mindset than when the historic bicycle makers started making cars because this they were changing something in their perspective to a positive thing, right? They said okay, we can offer more comfort. It is. It is it is an auto mobile so you don’t have to pedal No. Because now we have a motor right? You don’t need a horse anymore. We have a motor now. So we add comfort and we are in a situation where we can add comfort and we can add comfort. And now we have been so comfortable cars that all these comfort that we’ve added throughout the last couple of decades. Painful Yeah, yeah. pollution.
Jack Noy 27:57
Yeah. So there’s definitely no ambition from Canyon to be a part of the problem on that side is definitely looking for a solution, I guess using bikes as inspiration but also recognising that the car is so accepted. So hundred percent, there needs to be some DNA of that.
Carlton Reid 28:16
So two questions. First one, I’ll be rude. Second one is a more of a serious question. So the first question is, How serious are you at producing this? And how much of this is a concept? Two interesting thing, but you might not actually make this. So how confident are you of actually producing a commercial version of this?
Sebastian Wegerle 28:44
Well, for us, it is very important to go with our audience very early to the public to get feedback. So current stages, we have had all these ideas and brainstorming and things that go into this concept. And now we try to prove the concept. So first of all, we want to prove the design, then we want to check the acceptance. I mean, if you are writing moving such a vehicle in the car infrastructure, will it be a problem? Or will it be accepted? How does it operate on on bike lanes? And if we can check all these points right, then, of course, then the next step is to work on on producing it, we definitely go and now we evaluate the performance with cargo bikes and similar vehicles that are somehow around to protect the fuel. So the first point we’re working now on the on the first write of a prototype, not in the design, and it’s only about the function, right? And this is the next step. And if if all the feedback is positive, or the feedback is so we can still implement it. And this is also important if there’s valuable feedback, where people say, Yeah, but this is a stupid idea. If it would be like this, then it would be more accepted that we can take all this feedback, then the next step is to work on industrialization.
Carlton Reid 30:05
So my second question, and you always partly answered it there, sort of is that you’re both too young to remember this, but there’s a product called the Sinclair C5,
Sebastian Wegerle 30:17
I have this – we bought it.
Carlton Reid 30:19
okay.
Carlton Reid 30:20
Which got a lot of ridicule. So it was, you know, the, Clive Sinclair said, this is the revolution. It’s going to revolutionize transport. It’s there’s electric pedal device, it came out, and then people fell over laughing. And he got the rest of his career. He was dogged by the ridicule he got for producing the C5. Are you ready for the same amount of ridicule? And how are you going to tackle it?
Sebastian Wegerle 30:51
Now everybody can laugh now. And if we see that everybody starts laughing then we don’t produce it. But I think we may be avoided a few mistakes. stakes that they made are the Sinclair with the Sinclair. You fell over every time you try to move around the corner. Actually the Sinclair doesn’t address any thing like weather protection, because you get at least as wet as you get on the bicycle. Maybe even better because you’re sitting very close to the ground and whenever there’s a car driving through, and you get it not only from the top, but also from the bottom. And but it was so funny and impressive thing that we actually and it’s hard to find them. We bought one with what I think two years ago, we bought one to also have a first evaluation of the form factor. And of course, the situation has not changed. If you’re writing this futon, everybody starts laughing at your choke.
Jack Noy 31:52
I didn’t say Um, so I mentioned it earlier. And I was like, No, no, I think they have one in the office.
Sebastian Wegerle 31:59
We have one in the office and what is also what is also very funny that I think the perspective has also changed. I mean, bringing a simpler today, you would not end up with the same reactions, because the mindset has already changed. And this is something of course, yeah, there are issues with this concept, the 65 Yeah, 100% agree. But also the acceptance would just today, it’s a different situation. It’s not king of the king of mobility is the car and that’s the Holy Grail. No, it has changed. And we had nobody Well, we have it’s sending downstairs so there are journalists walking in, and nobody break down laughing. So we have first reactions. Yeah, that’s right. But the only thing I also they may I mean, this is this is where we learned a bit about how to focus on the on how to produce it, right because that’s exciting. What they did, they said very easy to shells, and things like that they had a huge investment in toolings, of course, because they have much more components. And it’s a quite complex, complex vehicle overall still.
Sebastian Wegerle 33:14
And also the quality. I mean,
Sebastian Wegerle 33:18
if we were
Carlton Reid 33:19
He sold 5000, yeah. So maybe he made 14,000 and he sold 5000 that’s not bad.
Sebastian Wegerle 33:28
It’s not bad. If your business case is to sell 5000 then everything is fine. But if your business case to sell 50,000, and you sell only 5000, then you bankrupt and we are fully aware of that. So that’s, that’s also what I said. I mean, we, if we must be bored, we have weird, weird discussions with some automobil Industries, suppliers that are working on motors and things like that. And all four types of vehicles in this category. And they asked us what is your what’s just a rough idea of a quantity that you could sell in the in the first year, the second year, and we said well in a business to consumer, for end consumers not for for commercial applications, because commercial applications thing people do calculate differently. We said one to 2000 units. That’s, that’s, that is our business case. And not more than that. Yes. Um, and because it’s easy I mean, you have if you talk to someone who is sourcing vehicles for commercial applications, for example, parcel deliveries or food deliveries, right? They they just calculate how much money I saved with this vehicle. How much more attractive is it is compared to school door car. So that’s a very racial aspects that dominate this decision.
Sebastian Wegerle 34:51
And it’s totally different from end consumers.
Carlton Reid 34:53
So right now the form factor is quite small, and there’s not that much luggage space you showed me like the way you put the child. But if this is going for in effect the cargo bike market would you envisage having more storage in a later version.
Sebastian Wegerle 35:14
We have to evaluate this. I mean it’s also something that changes maybe Of course you’re not going to the supermarket and only once a week and you’ll buy the stuff you need for the whole week. But I think there’s also something which is which is just just changing in the in the behaviour when it comes to sustainability. It doesn’t make sense to buy vegetables once a week and then throw away half of them because they are sweet to go on a more frequent basis. And if it’s not an issue if your mobility devices as it’s easier to use, easier to park it’s also not a burden to go grocery shopping twice a week for example, and we have this something We have to evaluate Of course and we have to make our experience and get different opinions on and then we see here and maybe we maybe we add the trailer
Jack Noy 36:11
a bit challenging the bike lanes. But yeah, maybe a train is good
Jack Noy 36:20
for little um,
Jack Noy 36:21
rather than rather than a rule. Yeah rather than roofbox a tail box something like this. Yeah.
Jack Noy 36:29
So make it look awkward again.
Jack Noy 36:30
Yeah. Then you lose the proportion.
Carlton Reid 36:35
Thanks to Wegerle and Jack Noy from Canyon for the product run throughs that. Next up will be canyons founder Roman Arnold. But before that, here’s my co-host David with a message from our show sponsor.
David Bernstein 36:50
Hey, Carlton, thanks so much. And it’s it’s always my pleasure to talk about our advertiser. This is a long time loyal advertiser. You all know who I’m talking about. It’s JensonUSA@Jensonusa.com/thespokesmen. I’ve been telling you for years now years, that Jenson is the place where you can get a great selection of every kind of product that you need for your cycling lifestyle at amazing prices and what really sets them apart. Because of course, there’s lots of online retailers out there. But what really sets them apart is their unbelievable support. When you call and you’ve got a question about something, you’ll end up talking to one of their gear advisors and these are cyclists I’ve been there I’ve seen it. These are folks who who ride their bikes to and from work. These are folks who ride at lunch who go out on group rides after work because they just enjoy cycling so much. And and so you know that when you call, you’ll be talking to somebody who has knowledge of the products that you’re calling about. If you’re looking for a new bike, whether it’s a mountain bike, a road bike, a gravel bike, a fat bike, what are you looking for, go ahead and check them out. Jenson USA. They are the place where you will find everything you need for your cycling lifestyle. It’s Jensonusa.com/thespokesmen. We thank them so much for their support and we thank you for supporting Jenson USA. All right, Carlton, let’s get back to the show.
Carlton Reid 38:16
Thanks, David. And we are back with Episode 255 of this spokesmen cycling podcast. Before the break we heard from Wegele and Jack Noy from Canyon. And now here’s the firm’s founder, Roman Arnold. I started by asking him about the bike boom. And we also talked about e-bikes and of course, Canyon’s concept electric car. Excellent. I have been as I’ve said, I have been to to your factory in Koblenze. So I did a story for Bike Europe daily on your plans for America. So that was back in 2017. So I came for that. So I’ll actually finish on America if that’s okay. But I’d like to start with with bike boom. So, how has Canyon coped with that? Have you coped with the extra demand that has come for a certain price level of bike? So you’re you’re clearly higher than that, that really popular price level, but how have you coped with the bike boom.
Roman Arnold 39:29
As
Roman Arnold 39:32
on one hand,
Roman Arnold 39:34
I feel a little bit ashamed as a guy from the bike industry that I have to say there’s something out like COVID In the end, our industry benefits from it. But when COVID came out, we had different scenarios. Also in our company, of course, like everybody, we were super afraid. What will this make to our business are we had certain plans how the business could develop in and most of the plans, of course, was the business will be down, will it be down 10% 20% 30% or even more. And we had one scenario that also was a tailwind scenario. And the tailwind scenario was something could this give me another extra 10% boom for us. And in the end, for us as a company and for the whole industry, it came out at the boom, we’re far more than 10%. So we sold more bikes
Roman Arnold 40:40
than we planned, of course, so we have quite
Roman Arnold 40:44
good year, and we were able to call this boom but on the other hand, we as most of the cycling industry are somehow limited because you know very well we have very long supply chains. So either you have a plan for me And to execute this plan, there’s not too much room so our business always was going very well. So also without COVID we every year have a nice growth rate. So they were they were not too much room for us even if we always think about good pros, he only ordered a certain amount of bikes so some of our bikes just were sold out earlier. It doesn’t mean to us that we wouldn’t have sold this bikes anyway. But we also could see so far Yes, we sold more bikes and we sold more bikes in every area. And not only in the entrance level area. Also people because it seems to be a more interested in cycling in moving their body doing some exercise. So also even road bikes. First down, but then also accelerated.
Carlton Reid 41:56
Mm hmm Did you have a percentage of how much bigger you got because of COVID?
Roman Arnold 42:05
I can’t tell you how much bigger the company that I think we have a growth rate this year Simon close to 30% or some something like this. Yeah, it’s a I think it’s a little bit over 30% but actually I have to say also our growth before was planned something between 20 and 25 so there’s not too much room
roma 42:35
extra for it but of course
Roman Arnold 42:39
some of the bikes we sold earlier we we have remained safe coming bikes in and what we saw in the very beginning that nearly in every country says go down because nobody knows What does COVID mean to us and how long the lockdown we hold on. I have to stay at home. How what will it mean. And then one country after the other country recovered and even countries I have to say like Spain and Italy, we have really in France in the beginning were really, really down after this strict. All of them were able to recover for us.
Carlton Reid 43:20
Yeah, so you’ve had electric bikes in your range for three years now, two years now. How big a segment is electric bikes for you right now, in percentage terms,
Roman Arnold 43:35
still less than 10% for us. But
Roman Arnold 43:41
in the whole industry, you know, it’s more around 50%. So we also, were able to grow our business in the past, even if we didn’t have a big offering electric bikes, but if you ask me home on how big you plan electric bikes will be in the future for you. I can tell you, it will be one of our biggest drivers for the business and we think it will be much, much higher percentage than today. But we are not the kind of company that you say okay woman, everybody is asking for ebikes Oh, we should sell e bikes, we can make some great money of it. We are more the company that has a we think we have a certain provisioning, we have a certain expectations to our bike. So we were somehow a little bit late with ebikes in the beginning, because we had the kind of company 10 years ago who discussed Is he back to cycling or not? And 10 years ago, we decided with a bigger motors and this No, this is not a bike. This is not a kind of positioning, but then getting the Moto slider and the batteries with more reach that you can go for several hours out. Then we decided, I think, five or six years ago, yes, this is pure cycling. This is also a kind of way we think it is. And then we start the product.
Carlton Reid 45:19
And I know you have a bike shop background. And you are now with a company that has no bike shops. But do you ever see a future where there may be bike shops in Canyon’s future?
Roman Arnold 45:37
Maybe making your own bike shops, Canyon branded bikes with the breadth of product you have from me in the very beginning.
Roman Arnold 45:45
So so what I say
Roman Arnold 45:49
Carlton, when
Roman Arnold 45:52
I’m still not old, but what I say okay, if there’s one legacy I have in this industry I was clear at the front front front to change this industry and Consumer Direct when people didn’t believe that it’s possible to buy a bike online. So we enter pairs for many of our followers and we are still the leader in this kind of industry. In the end for me, doesn’t matter. We are not the enemy of the bike shops, we are part in the in the beginning some of the bike shop said oh, this is our enemy. We are part of the cycling industry and the whole industry has a shift and we just we’re at the forefront. And there are many reasons there are many reasons why it’s right to buy a bike direct from the manufacturer because we have a closer contract because we have some price advantage and all the other things but there are also many reasons why it’s good to have a local shop that can service your bikes. And I see the whole industry is changing. And the industry is changing that everybody helps each other here. So we bring business also to local shops because in general because it has a big trend to internet to digitalization so they have less people working in in their shop. If people comes with our bike into their shop, this is also frequent in their shop brings the customer into the shop and they can service it. So it also can bring them extra business and you see many different things. You see some big shops, you see online retailer which still growing very fast, then you see pick a shop space, a big huge selection. They also find a way to survive and then you see smaller shops who are very specialised in service. So I think there is room for all of them and they will interact with each other and then make the whole cycling movement. better in the future. And yes, it might be also stores from Kenya in the future, but it’s more like a flagship show to show our sing. In Germany we say something like hundred is wonder. It’s a German saying and if you would translate it into English it would say, business always has to change or change is an essential thing of business. Yes, of course, we also have to adapt to new trends that we sync what we choose direct to the consumer. This is also the way you will see from Canyon and in the future we will also find ways to serve our customer even better, better. This might be with some of our own shops, but this also might be of corporations based affiliate dealers who also have other brands. This Might be through networks like I prepared at home
Carlton Reid 49:04
so I was showing yesterday your your guy showed me that your new electric bikes, but then they also showed me Of course they took the laptop and then showed me the concept car. So where do you see the concept car in say two years time? So if you bring the first one out where do you see it developing?
Roman Arnold 49:25
It’s a concept, is car the right word? Or we only call it car, what defines a car?
Roman Arnold 49:34
But let’s say the right word is concept car. But we also could say concept bicycle, or concept mobility or whatever. We did this because you weren’t problems and I would say what makes us go every day to work is because we love bicycles. And when we develop this pipe also with We are a big company now or medium sized company now. So we also have to do turn over and have to make some money. But the good thing is I still think our very first ideas oh how we can make our life as a scientist better how we can going out with new and you’ll see a general shift. In the whole society. People don’t want to go with cars anymore. They don’t want they want to fly less. All these things to more sustainability. But sometimes if you go with a car and if you go for 10 miles and it’s raining, yeah, you feel maybe I better should take my car. Or if you have to do some grocery shopping, put something in and this was the idea behind this concept, saying that we say okay, now within with the possibility of an email tool We can make a very light, protected pipe from the outside, where we can be very sustainable in moving from A to B maybe also bring our small kit to the kindergarten and to some grocery shot in this was the very idea behind it and then I allowed my people to work on this idea. We are already in a stage that we are in discussion with a car manufacturer that we say okay, is it possible to cooperate with him on the chassis? I cannot say in three years we will see this car but our goal is to do something like this in the future because we think it’s a good part of the mobility shift in the future because you need something what is lighter with the ledger less energy consumption, but you needed a little bit more comfortable than today.
Carlton Reid 52:05
So, Adam Opel in the 19th century so 1890s he was a bicyclist his sons were all bicyclists, it was an oval was a bicycling company. Opel very quickly became not a bicycling company, it became an automobile company. So, trajectory of lots of bicycle companies in the in the 19th century were start with bicycles. And they all many of them evolved into car companies. So that’s not it’s not a crazy idea to think of that maybe in 2030 years time Canyon is Canyon Cars, not Canyon Bicycles. Is that a crazy idea? Or is that …
Roman Arnold 52:54
It’s not a crazy idea, but I would not call it Canyon will be Canyon Cars. Canyon Bicycles will always be Canyon Bicycles, because this is what we think is the future. And but I would say otherwise, Canyon will produce bicycles also in the future, which can substitute cars and some way also learned some things from what we seen today as a car. But I totally believe from inside, car for sure for sure will be not a mobility concept on short distance in the future. I would say if I want to polarise also, I would say the the century of the car was the 20th century. Now we are next stage. The car will not be the future mobility, the car will have a place in future mobility and the reason why Adam Opel changed to cars is because there was a whole shift from horse to bicycle to car. And I think also car companies has to shift and has to see on different kind of mobility. I will not say there will be no SUVs. There also is a purpose for SUVs, if you have a big family if you want to go to holiday and this, but I believe pretty much it will be not the same like it was before. When I talked to the German magazine here, I thought I have to shame when I see how much money politics spend for the next generation of autobahn and this and then compare how less money they spend to make the car more bicycle friendly. And it’s not because I’m from the bicycle industry. It’s just because every day in the traffic jam, it’s obvious that this cannot be our future.
Carlton Reid 55:01
So you went into America in 2017? I think it took you a long time. It took you two years, three years to actually get the structure right. For America. So was the structure correct? Was it waiting that long did that? Was that the correct thing to do?
Roman Arnold 55:23
If I would answer this in American language? I would say yes, yes, we did it. Yes, we did it. And we did it right. Actually, it took us far longer, I always was my goal that can ensure a global company and global without the United States is not really global. So So therefore, we were very, very hesitating so fast. It was somehow easy to serve Europe from also our infrastructure we have here there’s not too many German cars. He’s made it in the US. So therefore we really prepared very well for it. And if I Three years later, I have to say, Yes, we made it even made it in the US. And maybe Frank Sinatra says if you can make it in New York, you can make it anywhere.
Carlton Reid 56:20
So how big a segment of your company is America?
Roman Arnold 56:31
Yeah, it’s already close to 15% 18% already. And we have a steep growth rates in the US and what we can see from in the US DATA, so when we see the ddata that we already recognisable force in the US for road bikes, and people noticed that we are setting also mountain bikes in the US. And I will say in this short time for only three years, we are quite successful in the US. And it seems that people like our German engineering in combination with the direct to consumer. Yeah, so I’m quite happy what we achieved in the United States.
Carlton Reid 57:24
Thanks to today’s guests Wegele, Jack Noy and Roman Arnold. The video version of half of today’s show can be found on YouTube and has been embedded on our website at the-spokesmen.com That’s also where you’ll find show notes and plenty of other information. The next episode is an interview with psychologist and record breaking endurance cyclist Ian Walker. That’ll be out at the weekend. Meanwhile, get out there and ride.
