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Dutch bicycle manufacturer reports sales growth in hard economic times

by VeloNews.com

• November 19, 2008
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At least one company is benefiting from the global economic crisis: Netherlands-based bicycle maker Accell predicted Wednesday that it will enjoy higher than expected 2008 profits due to rising sales.

“Cycling remains popular in economically adverse times,” Accell Group chief executive Rene Takens said in a statement. “Last summer’s increase in fuel prices caused a lot of consumers to think about alternative means of transportation. This led to a more frequent use of the bicycle.”

The group, which claims to be the market leader in Europe, expects net profits to rise by 15 percent over 2007 figures ? up from growth of 10 percent predicted a few months ago.

Accell companies manufacture a wide range of cycling products, including several high-end lines such as Batavus, Lapierre, Mercier, Ghost and Redline. The company reports that much of its growth occurred in the manufacture and sale of its high-end product lines.

“The order intake for the 2008-2009 bicycle season is currently at a higher level than last year,” said the statement.

Takens also noted that there was significant growth in sales of electric-assisted bicycles, a phenomenon he attributed to an aging demographic profile of the average European consumer.

The group, which has manufacturing plants in the Netherlands, Belgium, Germany, Finland, France and Hungary, recorded sales of 476 million euros (about 600 million dollars) last year, and net profit of 24.4 million euros.

Forty-five percent of its sales are in the Netherlands, followed by Germany with 24 percent and France with nine percent, the statement noted.

The recent rapid decline in oil prices – from $120 barrel to just $52 – may dampen that expansion, but the company says that an apparent economic recession may prompt consumers to cut corners in several ways, including an overall reduction in automobile use.