Hi Guys, it is Rob Provost again with Prodeco Technologies. Eric's review of Interbike was great and everyone had a great time. We knew the show would be excellent but the show actually surpassed our expectations. We had a great location which was directly in front of Cervelo, Thule was to the side and Fox was our neighbor behind. Every year has been great for us but what a great group of people we met at the show this year. We sponsored the Electric Bike Demo track and help manage the helmet desk. Our 4 demo track guys said the support from the bike and ebike community surpassed anything they were expecting themselves. Ebikes usually were frowned upon with the show being predominately the traditional bike industry but this year it was very different. Ebikes are now being recognized as a must for bike shop owners. The response we received during and after the show was almost overwhelming. It will be an amazing year.
I just wanted to write a quick comment in regards to comments in this thread about pricing, margins and warranty. I hope this will be a short response from me but once I start typing, I cannot even stop myself, lol. I tend to write very lengthy posts because I have so much to say.
This year we believe the bikes in the industry are at an all-time best. We have never seen a better group of companies than this year at Interbike. There are the usual companies who try to bad mouth the competition to build their company but for the most part just a great group of companies all trying to build better bikes.
Our company also this year made some drastic decisions on suppliers and why the big upgrades across all our models with minimal to no price increases. We have added new models also though. In regards to upgrades, an example is we partnered with SRAM for our drive trains and brakes on all 22 models we offer. Some bike models will also use SRAM (SRAM, Truvativ, Rockshox) supporting components extensively throughout the bike such as stems, cranks, chains, forks, seatpost, bottom brackets, handlebars, etc.. We are now purchasing over 70 different components/part numbers from SRAM for our bikes. SRAM included, we are direct with all our suppliers and buy in the many thousands of units. Our price is due to no middle channel and why the pricing is low. We do not have to pay duties where if the bikes were built in Asia, there would be taxes imposed by the Asian governments which most electric bike companies that sell in the USA don't even realize. By eliminating multiple issues including the need for a separate manufacturer to build the bikes for us and we build the bikes ourselves, the savings are roughly 40%. This is also due to our knowledge and the negotiation of component pricing, partnerships, quantities, shipping, etc... It takes 7 hours to build each bike and we prefer to pay that to American workers. It also gives us complete quality control over the build process and allows us to have over 3,000,000 parts on hand for replacements if needed. We do not have to take components off of other bikes if someone needs a part. Since we build, we also know the bike inside out and understand every aspect completely. For example, a chain fell off a competitor's bike at Interbike and they could not figure how to put it back on and had to ask help from a bystander. 80% of our 48 employees could replace a chain if needed or do so much more. This year we are adding almost 30 new jobs as well with 90% being at the production level. The difference in our price over others is also due to people not realizing how much cost goes into overhead for an electric bike distributor including commissions, storage, RMA, promotions, adwords and such. That is why we have no sales department and all our focus and resources are spent on just building the bikes. It confuses people why are bikes are so much lower in cost. Competitors have been making up all kinds of stories to our dealers. There are competitor's even telling dealers if they sell Prodeco Technologies bikes, they cannot sell their brand. It is becoming a joke of how insecure some of them are over their bikes. Keep in mind there are great companies out there such as Currie, Stromer, Grace, Optibike, etc.. who strive to build better or the best bikes and want to work together to improve the industry as a whole. This year had the best bikes ever without a doubt. There were some very unique bikes and more than ever designs were starting to become appealing to the 16-40 year old buyers. I hope we had something to do with that, because over the years the 16-40 base has always been our key demographic. We also displayed a prototype of our new Stride Matic bike with the new SRAM drivetrain. Electra also had a bike displayed with the SRAM system which to me is a great system. The SRAM system makes perfect sense for the Electra bike and a very high quality system with only 1 connection. The SRAM system has a built in automatic 2 speed transmission, built in controller and built in torque sensor. Talk about simple installation, it does not get any easier than the SRAM system. We will be offering 3 models in the Spring with this system.
Someone also asked if anyone knew Prodeco Technologies' margins. Since I am the CEO, I have access to this info, :wink: . For our company to be sustainable, we have to make a profit otherwise why bother or how could we survive. We want to see a big portion of Americans riding ebikes and knew we had to make them affordable but if we do not make a profit, it would make no sense. We are not doing this for fun or that we have nothing else better to do. It is a tremendous passion of ours and we will continue to work hard to move this industry forward but we have to be sensible. Speaking about moving this industry forward, that is the number one reason why we also are the GOLD Sponsor of LEVA (Light Electric Vehicle Association). The GOLD is the highest sponsor position for them and they are all about the industry working together to move eBikes into the Mainstream.
A little information on how we decide to price for our bikes, we do it backwards. All our bikes were designed by price instead of coming up with a price afterwards. This was the same with weight. In other words, we decided to build the best possible bike for the price we set. We knew we wanted our first bike to be $1000 so we subtracted the dealer margin and subtracted our margin and was left with an amount. We then for 1 year worked liked maniacs flying everywhere and doing so much negotiation to get the best possible price for the highest quality components to meet that price. With our VC guys behind us, we are required to make a margin and be profitable each year. We just could not waste 1 penny and we have to run under a very strict business plan and business model. We call it 21st century manufacturing. From day 1 we just always figured if we build the best possible bike for the correct price, the customers would come and boy did they come this past year. We wanted the bikes to be different than anything else on the market and purposely went the opposite direction of the existing manufacturers. Most companies go for the baby boomers and we went for the under 40 crowd where most traditional bikes are sold. The biggest area where the price savings are the strongest is the relationships we built over the years with our suppliers. It is almost a science to figure the price of what each component should be by calculating material, labor, intellectual, support, etc.. The formula will determine what a component should cost. The component fabricator has to make a little something or they will not want to produce that item for us. We have 22 suppliers/sub-contractors and way over 300 components we either produce or purchase individually but by thousands each. Sometime on just one component we may have to spend $10,000 - $20,000 for a mold to be redesigned but overall it will save resources in the long run in other areas such as production time.
There was also a comment about the future being a bunch of Chinese made ebikes on the road. It does not have to be. For example the Outlaw bike we had on display in a Glass Kiosk which Eric wrote about in this thread is built by us in South Florida USA. Granted the components are from all over the world with the majority all from Taiwan and why we say Built in the USA versus Made in the USA, but it is the same as with most auto manufacturers and the production of the bike is at our facility. Taiwan also offers the highest quality components for the bike and ebike industry. China also has high quality suppliers/sub-contractors but quality control has to be stronger. China for example is where iPads and iPhones are made but with Taiwan, quality is easier to obtain.
Here is a little information about the Outlaw and the statement made by someone of mass produced ebikes. The Outlaw bike has an incredible frame design and riding position and the frame quality level is hard to duplicate in any country. The frame was designed in house (Florid, USA) by us and we use 3rd party engineering/testing. We subcontract the fabrication of the frame but under extremely tight quality control with ZERO tolerances and we will reject frames for the smallest issue. The dropouts are also our own exclusive design for 2013 with new stainless steel built in torque arms also developed by us. The components come from 20 suppliers/sub-contractors but each bike is built by us in our facility in the USA. The Outlaw alone will add 12-20 new American jobs this year, depending on production. The components for this model are as follows: Heavy duty TIG welded 6061 Aluminum frame with a first rate 4 step Auto Grade paint finish and the decals under the clear coat, Avid Elxir 5 Hydraulic brakes (found usually only on $3000 non-electric bikes), Avid HS1 Rotors (the industry's best rotor), SRAM X9 Derailleur (industry best), SRAM XO Shifter, SRAM S600 Crankset, Truvativ Power Spline Bottom Bracket, KMC X8.93 Chain, SRAM Pit Stop shift cables and housings, Truvativ Huss Seatpost, Truvativ AKA Stem, Truvativ Huss Handlebar, CNC Alloy Cups with Stainless Steel Sealed Bearings Headset, Magnesium Double Crown Suspension fork with Hard Anodized Aluminum Stanchions and 20mm Thru Axle, Sealed Bearing Front and Rear Aluminum Hubs, 18-8 12G Stainless Steel Spokes, Anodized Aluminum Triple Box Rim with Stainless Steel Eyelets, Continental Trail King 2.4" Tires, Gyes Genuine Leather Saddle, Genuine Leather Grips but these are the upgraded extra thick slotted Leather grips, 48V 750W Direct Drive motor (3 year warranty with our supplier) and the best part of all, the Auto Grade LiFePO4 2000 Cycles 51.2V 9Ah 24 cell battery system (our exclusive design). There is not 1 cheap part on that bike, not 1. If anyone was to try and build a bike like that in their garage, they should start adding the cost up, it will easily be over $4000 to get that quality level and that finish. The reason I mention this is that more and more you are seeing manufacturers try harder. A few years back, most ebikes were not so great and I feel we had something to do with manufacturers having to improve their game. The perfect example is the connector at the motor for hall sensor motors. A flat use to take forever and no bike shop wanted to tackle the issue for rear drive ebikes which had one long motor cable to the controller. We came out with the first disconnect in 2009 and then by 2011 everyone had it. We were the only company of over 20 electric bike companies at the Interbike 2010 event to have it, the next year it was everywhere. Motor manufacturers were saying it could not be done in 2009 but we pushed the envelope and came up with some unique designs. We ended up opting for an existing connector in another industry and brought it into the ebike industry.
I truly believe there will be higher quality electric bikes coming in the future from all manufacturers. It is up to the manufacturers to push each other. The distributors which call themselves manufacturers also need to push the manufacturers who produce their bikes to build a better product. The ebike industry when we first became involved had such a bad reputation and little by little we are seeing it improve. Bikes that were selling for $1500-$2500 had components from $100 bikes and now that is changing little by little. Some manufacturers still have models with low end drivetrains, steel bars, steel saddle clamps, steel headsets, retainer bearings, etc.. and trying to sell for $1500 or more to unsuspecting dealers and consumers but there is improvement.
Unfortunately as with any industry there will always be some competitors or individuals who prefer the negative avenue or who try and stifle the competition. There was even one who tried to get an injunction against us from attending the Interbike show. Some of them use all kinds of dirty tactics on broad levels including dealer ultimatums but then there are the long term solid companies who are trying to build great bikes and be realized for their great bikes. For our company, it is all about the bikes and building the best bikes for the best price while maintaining a profit.
Guys, I have to apologize for writing so long again and if everyone prefers I stay away from Endless Sphere because it is more a DIY forum, I will do so. I will only come on once in a while if I feel the wrong information is out there or we want to give a heads up on something new in the industry.
Robert Provost, CEO, Prodeco Technologies
The ego kit on the v10 was really good, super nice bike, though noisy, back pack battery way better then I thought it would be, like wearing a camelback. Most the bikes were good, really good infact . I had to really start to nitpick to find faults. Through the gears pedalecs are cool, 250 w not so much. The nuvinci one was good though, seemed to go almost as good as the 500w bikes. The Stromer is pretty smooth and nice, I really liked the downtube battery . I didn't get to ride the grace, but it looked good. Similar downtube battery design. I liked the pedalecs better then I thought I would. I wish I would have documented every bike a lot better. Wish I would have got to talk to Justin. Obviously the more power the more fun. ![ATTACH]](/sphere/proxy.php?image=http%3A%2F%2F%5BATTACH+type%3D%22full%22+alt%3D%222012-09-20_14-52-57_663%2520%28800x450%29.jpg%22%5D1%5B%2FATTACH%5D&hash=568563f15448ef39c7fffd87900995d7)
![ATTACH]](/sphere/proxy.php?image=http%3A%2F%2F%5BATTACH+type%3D%22full%22+alt%3D%222012-09-20_14-56-14_702%2520%28800x450%29.jpg%22%5D0%5B%2FATTACH%5D&hash=68914b2aa793e28be4f724ed269e91ce)
