Merida the latest bike brand to report significant slump in sales, profits down a third

Merida has reported a fall in sales and profits for the start of 2024, following on from a challenging 2023 as the bike industry continues to battle through difficult times.

The manufacturer saw sales drop by 29.8 per cent in the first quarter of 2024, while post-tax profits are down 31 per cent, both of those figures in comparison with the same time period last year, a further slump considering the brand suffered a 26.4 per cent reduction in sales during 2023.

BikeEurope was first to report the figures, Merida following fellow Taiwanese bicycle manufacturer Giant in posting significantly down financial results for the start of 2024. Earlier in May, we reported that Giant's sales were down 20 per cent in the first quarter of 2024 as post-tax profits slumped by 38 per cent.

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For Taiwan's second-largest bike manufacturer Merida the outlook is similar, the opening three months of the year seeing sales fall by a third to 5.86 billion New Taiwan Dollar TWD (£142.87 million) while post-tax profits were TWD 432.73 million (£10.55 million).

The figures represent a continuation of the challenging times for the bike industry felt during 2023, Merida reporting that sales were down to TWD 27.16 billion (£679.51 million) last year, a decline that has followed the brand into 2024.

Numerous major players in the bike industry have highlighted the challenges of a post-pandemic cooling of demand, ongoing inventory issues, and economic factors such as inflation hitting customers' ability to spend.

Last month, Shimano reported another significant fall in sales figures, with net sales down 22.6 per cent for the first quarter of 2024 amid predictions its annual sales in Europe could contract by more than £170 million this year.

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The components giant remained confident that "overall interest in bicycles remained high as a long-term trend" but recognised "supply and demand adjustments continued, and market inventories remained high globally".

Then, more recently, Giant reported its sales and profits were down too, the bike brand putting a positive spin on the news by reporting that interest in the Chinese market "remains strong" due to an "increasing trend in sports and recreation which supported the sales of mid to high-end bicycles".

"With the launch of new models, Giant expects to see continue sales growth in China," the brand predicted, adding that its new TCR model had "received positive feedback from Chinese consumers" at the China Bicycle Show earlier this month.

"As for Giant US and European, sales continue to be affected by inventory reductions," it said.