Shimano suffered a fall of nearly 21% in its cycle component sales for the first half of 2024, it has reported, compared to the same period last year. The company says that continued overstock in the industry is to blame.
There is no suggestion that Shimano is in trouble though, with even the lower sales figure amounting to 162,594 million yen ($1.05 billion/£818.3 million) in net sales, representing a 20.7% fall, as first spotted by, Bicycle Retailer & Industry News.
Operating income also decreased by 42.2%, to 24,328 million yen ($161.5 million / £124 million), while overall net sales were 216,887 million yen ($1.44 billion / £1.22 billion), compared with 263,250 million yen ($1.57 billion / £1.22 billion) at the same time last year, a decrease of 17.6%.
Cycle division sales for the second quarter of this year were down 18.9% to 85,504 million yen ($568 million / £442.3 million), Shimano reported.
“While the strong interest in bicycles continued as a long-term trend, supply and demand adjustments of completed bicycles continued, and global market inventories generally remained high,” the company said.
The figures aren’t hugely different to last year, when Shimano reported a 17.7% fall in bicycle division sales for the first half. But that followed a hugely successful 2022, which saw Shimano report record net sales of 517,436 million yen ($3.4 billion / £2.7 billion) from its cycle division.
The industry glut was caused by excess manufacturer orders in anticipation of a continued wave of popularity for cycling after the pastime took off during the covid lockdowns. When people unexpectedly put their bikes back in the shed once normal life resumed, suppliers and retailers were left with a huge amount of stock that is yet to be completely sold.
But the cycling industry has been urged to ‘survive till 25’, as reported by Cycling Weekly in June, with a report by CONEBI suggesting that overstock issues could be resolved at some point next year.
This is not the first time that Shimano has been in the news this year, with the stalwart Japanese brand reporting a 52.3% fall in net profit in its 2023 financial report. It was also hit by the recall of one of its most popular components – the Hollowtech II 11-speed crankset. After reports of the cranks delaminating it had to initiate an inspection and replacement recall that was predicted to cost the company $23.7 million / £18.5 million.
