The wheels are coming off the cycling boom as a Dutch electric bike maker dubbed “Tesla” of e-bikes declares bankruptcy.
Amsterdam-headquartered VanMoof, whose minimal designs and high prices won the company repeated comparisons with Elon Musk’s electric car firm, saw its sales surge in the Covid era.
It has run out of road only two years after raising $128m (£98m), from investors, to fuel its expansion.
VanMoof, founded by brothers Taco Carlier and Ties Carlier in 2009, is a Dutch company. Around 700 people work for the company, which has stores in Amsterdam and Berlin, Paris and London, Tokyo, New York and Tokyo. The company claimed to have sold 200,000 ebikes.
Some of its e-bikes can cost up to thousands of pounds. One of the S5 bikes is priced at £3,298. It is described as “Perfect for controlled cruises and longer rides”.
The models are equipped with electric motors, and automatic gear shift systems. Many of the parts in its bikes, however, are proprietary. This means that mechanics and regular stores are unable to repair them.
The Amsterdam District Court appointed administrators on Tuesday to consider a possible sale of the company or its assets.
The impact on the subsidiaries of the company outside the Netherlands is still unclear.
VanMoof UK’s accounts show a net liability of £1.7m by the end of 2021. This is up from £267k at the same time last year.
The bankruptcy of VanMoof comes during a decline in the UK’s cycling market following record sales during pandemic.
According to Mintel, the data experts, electric bike sales have tripled in five years, from 55,000 bikes in 2017 to 160.000 in 2021. Mintel stated that sales in 2022 were expected to reach 155,000, as cyclists reduced their spending due to the cost-of-living crisis.
Paul Davies, category director, Leisure Research at Mintel Reports said that the weakening of the pound will likely push up prices in this heavily imported market.
The majority of e-bike buyers are relatively wealthy, but a prolonged cost of living crisis or income squeeze is likely to delay purchases and push some consumers out of the market.
According to the Bicycle Association, mechanical bike sales also dropped. They fell by 22pc to almost a quarter in 2022, putting them almost a third below pre-Covid levels.