Helmet technology company MIPS has reported 46% year-on-year drop in net sales for the last quarter of 2022, reports Bicycle Retailer. For the year as a whole, the company experienced a drop of 7%.
It comes off the back of a 50% drop overall in helmet sales.
According to the CEO of the Swedish company, Max Strandwitz, “A drastic slowdown in the bike sector in the second half of the year had a substantial negative impact on sales in sport, our largest category.
Strandwitz maintained however that he was confident in a quick recovery, as early as this year.
“We stand by our earlier assessment that the bike market will start to recover during spring 2023,” Strandwitz said. “Our assessment is still that over time there will be excellent opportunities for growth and solid consumer demand in the bike category.”
MIPS stands for ‘multi-directional impact system’, which the company manufactures to fit inside cycle helmets and is designed to lessen the damage caused by rotational impacts.
It is not the only company suffering at the hands of the reduced demand across the bike industry. Only this week US high-end frame builder Parlee filed for chapter 11 ‘reorganisational’ bankruptcy in the USA, while Specialized recently made 8% of its workforce redundant – 125 people.
It comes largely as a result of heightened demand during the pandemic lockdowns, with consumers making the most of extra leisure time and almost traffic-free roads around the world.
However, as the industry raced to keep up with demand, producing and ordering as much as possible, demand in the post-covid world has tailed off, a drop that has been accelerated by a global financial crisis and the ensuing reduction of spare consumer cash.
Industry commentators are predicting that 2023 could be the year to grab a bargain bike, with overstocked retailers and suppliers reducing prices as they attempt to make way for this year’s new-model gear. Beleaguered Specialized even attempted a tongue-in-cheek take on things, putting on a ‘We Made Too Many’ sale; cold comfort of course, to those who have been laid off.
Equally, there are predictions that 2023 will see the industry ‘settle’, with a return to some sort of normality in 2024.