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junko.yoshida
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Blogger
$10K bike?
junko.yoshida   7/22/2013 8:44:56 AM
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When I first read the headline, I couldn't help but say, "Geez, only in Japan!"

But I actually like the thinking of Toyota's skunkwork team. A car company getting into a bike business illustrates a new frontier!

Yog-Sothoth
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Freelancer
Re: $10K bike?
Yog-Sothoth   7/22/2013 10:25:37 AM
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Err, Junko, $10K for a bike means a very small market. This is just a loss leader from Toyota.

mcgrathdylan
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Re: $10K bike?
mcgrathdylan   7/22/2013 12:30:09 PM
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I agree, Yog-Sothoth. Seriously, who is going to pay $10,000 for a bicycle? I find this to be a very strange move by Toyota. I don't see the logic.

DMcCunney
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CEO
Re: $10K bike?
DMcCunney   7/22/2013 1:13:54 PM
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I see the logic.

This is not a product for sale.  It's a proof of concept for what Lexus can do with various technologies that will also be used in automobiles.  Even at the price charged, I'd be surprised if Lexus even covered its costs in making these.

There will certainly be people who will buy them, simply to have one of an extremely limited item.  Possession will be a status symbol.  I might be surprised if any of these actually get used in competitive racing.

But there is a market for high-end racing bikes, and I can see that market being interested in the technologies used, and bike makers talking to Toyata about licensing and OEM deals to produce bikes like it.

Meanwhile, Lexus is saying "If we can do this with a bike, imagine what we can do in a car you might buy down the road!"

 

 

mcgrathdylan
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Blogger
Re: $10K bike?
mcgrathdylan   7/22/2013 1:18:28 PM
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@DMcCunnery-- well said.I understand what you mean, especially the point about the people that would be willing to pony up just for the status symbol.

 

I have to say I've really been enjoying your contributions to our forum. We are lucky to have your insights.

Caleb Kraft
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Blogger
Re: $10K bike?
Caleb Kraft   7/22/2013 1:35:33 PM
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There's actually already a market for bikes between $5k and $15k. Lexus could launch this as a product and compete in that market (if their bike holds up). I suspect that in real world use it may not compete with the others in that price range, like bianchi, cannondale, specialized, felt, etc.

It isn't even close to being the most expensive either. Specialized released one last year that was nearly twice that cost at $19k.

DMcCunney
User Rank
CEO
Re: $10K bike?
DMcCunney   7/22/2013 2:09:59 PM
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Lexus could launch this as a product and compete in that market (if their bike holds up)

Launch it as a product, certainly. Compete would be another matter.  When you are someone like Lexus, size matters.  A market has to be big, and you need to sell a lot of products in it, to make it worth doing.

On a similar line, I was in a discussion a while back about purpose built taxicabs.  Decades ago, the Museum of Modern Art in NYC had a competition to design a cab, and the discussion revolved around that sort of specialized design.  One participant was an automotive engineer who worked for GM at the time.  He said GM needed to sell a minimum of 350,000 of a model per year to make it worth doing,  They simply could not address a tiny market profitably, and the market for that sort of purpose built cab would be a fraction of that minimum.

A smaller, focused, niche-market company specializing in that sort of thing can make and sell a high-end racing bike retailing for that sort of money and make money doing it.  Lexus couldn't.  It's too big, with too much overhead, to get the ROI required.

DMcCunney
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CEO
Re: $10K bike?
DMcCunney   7/22/2013 1:58:17 PM
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especially the point about the people that would be willing to pony up just for the status symbol.

High end luxury goods are always status symbols. They may have real-world uses, but there will always be something less expensive that will serve the same purpose. You buy the high-end product in part to demonstrate to the world that you can.

I have to say I've really been enjoying your contributions to our forum.

Thank you.


It's a matter of perspective and viewpoint.  I'm not a design engineer.  My connection with the world EETimes covers is as a systems, network, and telecom administrator.  But all of those things exist within a larger context.


I'm one of those folks who reads the Wall Street Journal for fun, and I've had an interest in business and economics for decades.  And I have interests in history, politics, and culture, because all of those things intersect to form the societies that use the sort of products and services that get discussed here, and the nature of those societies determines the products and their usage.


My insights tend to come from stepping back to look at that larger context, like "Don't think of this as a bike, think of it as a technology demo, and then think about where else that technology might be applied." 

(And thinking about it, one reason for doing the demo as a bike is form-factor: stuff that would be hidden from view in a car is on front and center display in a bike.)


Yog-Sothoth
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Freelancer
Re: $10K bike?
Yog-Sothoth   7/22/2013 1:46:34 PM
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Agree - there are probably a few people who will shell out $10K for one simply to have the best.


It's a long hard road to getting the status of a Maserati , Aston Martin or Porsche though, will selling 'the best' bikes help Toyota/Lexus?

junko.yoshida
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Blogger
Re: $10K bike?
junko.yoshida   7/22/2013 7:12:34 PM
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No. The point is not about selling more Lexus for Toyota.

The point is, "look what we can do with our Lexus technology!" It is a PR stunt and I am pretty sure that's what it's meant for.

A large company like Toyota can afford to have a little fun like this -- even though I am pretty sure that the idea of designing a bike didn't definitely come from bean counters.

Sanjib.A
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CEO
Re: $10K bike?
Sanjib.A   7/22/2013 7:14:58 PM
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Would like to take a ride on this bike. Understand what they are doing, but $10K for a bike?...don't understand why they are doing? They want to be in the next gen bike business or just creating a brand value for Lexux?

Tom Murphy
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Blogger
Re: $10K bike?
Tom Murphy   7/22/2013 7:32:15 PM
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I live just north of San Francisco and I ride a bike I rebuilt on a 30-year-old steel frame for about $75.  But I commute in the company of many, many riders who ride bikes that cost anywhere from $2,000 to $15,000.  There is definitely a market beyond the professional racing circuit for bikes like that, but I don't know any cyclists who would buy a "Lexus" bike.  Most high-end bikes are made by bike firms that compete hard against one another to make the perfect bike -- and they know what they're doing.  A bike made by a car company sounds like just what it is: a publicity gimmick. 

Don't believe me? Ask yourself: would we be talking about Lexus right now if they didn't make a bike?

tb100
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CEO
Cheap
tb100   7/22/2013 7:35:09 PM
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If you've ever been to a car show you've seen concept cars. These are cars that showcase future and futuristic technologies and manufacturing capabilities. Since they only build one or two they probably cost millions to build, if you include all the hand-labor involved. And they don't sell them.

Consider this as a concept bike--it shows off their technology and design capability. And they can actually sell them off after showing them off!

Compared to a concept car, this is incredibly low cost. Makes a lot of economic sense.

 

kfield
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Blogger
Bill of materials
kfield   7/23/2013 10:07:21 AM
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I'd like to see a bill of materials for this bike, as on the one hand I am having trouble imagining how the price tag got so high, but then again if all of the components are hand machined the labor costs were likely through the roof. I wonder if they are doing anything interesting with the composites, as they're fairly well estabalished today in high end road bikes.

Duane Benson
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Blogger
Re: Bill of materials
Duane Benson   7/23/2013 3:44:05 PM
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I used to be a fairly dedicated road bike rider. Most of the people I rode with had bikes that cost in the $2,500 range, a few were around twice that. It's not at all inconceivable for me to imagine a $10K bike with custom parts, even from a bike manufacturer.

Of course the question of $10K in value is something all together different. My bike was off the rack and significantly less expensive than those around me. They kept telling me I needed a new bike and they'd help me build it. Rather than spend $2,500 or more to shave five pounds of weight off of my bike, I told them I'd just eat fewer donuts and get the same effect.

The_Manfred
User Rank
Apprentice
Nothing to see here...
The_Manfred   7/23/2013 12:28:32 PM
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The real headline should be: "Lexus Paints and Assembles Bike." There's no innovation here. All they've done is assembled the bike using standard off-the-shelf components. The BOM isn't surprising either given that the Di2 groupset retails for $3300 and the wheelset costs another $2800. Toss in $1000 in carbon fiber components and a $3000 frame, and there you are: a $10k bike.

Grossrider
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Rookie
What's the big deal about $10K?
Grossrider   7/23/2013 1:52:05 PM
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So what's so significant about $10K for a high-end bicycle? How far would $10K go if you were buying a motorcycle? A boat? A car? A piece of jewelry? These days, you can spend that kind of money on almost any item you can name. I agree -- Toyota didn't really contribute all that much. Shimano has been making high-end, nose-bleed componentry for a very long time, and electronic shifters have been available for a few years now. Just another sales gimmick.

zhgreader
User Rank
Rookie
Re: What's the big deal about $10K?
zhgreader   7/24/2013 3:53:28 AM
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10k can buy a fair car.



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