# Giant 2010 pricing



## jshih (Sep 18, 2009)

Another new year, another new website.

But wait! the new 2010 pricing is out. Am I seeing thing? a new TCR advanced SL ISP Frame and fork is $2900, a 25% reduction from 2009.

Here is the question: was the product way over priced in 2009 or it's a lesser F/F for 2010?

Appreciate any inside scoop from anyone who is well connected to Giant's operation.

Jshih


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## thatdrewguy (Aug 7, 2009)

I'd like to ask another question about 2010 Giant pricing. On the website Giant lists an "average retail price" for their bikes. Is this the price most dealers are selling bikes like the TCR Advanced series for or can I expect a discount off the website price?


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## icsloppl (Aug 25, 2009)

The great majority of a carbon frame's cost is up-front, that is in the manufacturing equipment and molds. The cost of the unit materials is low, and the cost to produce a single unit is close to zero.

From a costing point of view, a carbon bike frame is more like a computer chip than say, a car, which has a very significant per unit materials and labor cost.

To the frame maker, this means that the more they make and sell, the lower the cost per unit, up to the point that the equipment and mold cost has been fully depreciated, and the cost of a unit is close to the cost of materials + labor. For a typical frame, that's probably less than $200.

A great solution given this cost structure is to take your high-end model for a given year, and then continue to sell it as a second-line unit the next year, and so on for as long as the technology / performance are competitive. Companies hat can utilize this model with a high unit output make an absolute killing.


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