Halfords, the UK's largest retailer of cycling products and services, saw its cycling-related sales slump during the middle part of 2023 as motoring filled the void left by the hit to spending in cycling.
Noting that "discretionary" spending areas, such as cycling and car cleaning, were "adversely affected by unfavourable weather and low consumer confidence", Halfords explained that its cycling sales had fallen by 2.7 per cent during the 20 weeks to 18 August.
Overall, the company saw sales rise by 7.8 per cent and concluded it should focus on "needs-based" sources of revenue, such as cheap motoring repairs.
Cycling represents 25 per cent of Halfords' business, but the broker Peel Hunt said it had "underperformed".
"Cycling and tyres underperformed and July and August were tough, so it is hard to predict too rosy a short-term picture. However, the market share gains should bear fruit in time, and the strategy is bang on point."
With 643 garages and hundreds of mobile servicing vans, chief executive Graham Stapleton suggested the "ongoing focus" on car repairs is key to the "good start to the year".
"It's been a good start to the year for Halfords, and our ongoing focus on essential maintenance and servicing is driving a strong performance in our autocentre and retail motoring business," he said, predicting the full-year, pre-tax profit to be between £48 million and £58 million.
In the 20-week period, sales at Halfords' servicing and repair autocentres increased 34.6 per cent as the company outlines its plan to negotiate the challenging economic picture by providing customers with cheap and reliable car repairs.
"We're continuing to do everything that we can to support our customers through the cost-of-living crisis and are determined to offer them unrivalled value," Stapleton continued.
"For instance, our research shows that motorists who use manufacturers' franchised dealerships can pay over 50 per cent more for repairs compared with Halfords. With the average cost of car ownership pushing £300 a month, the last thing hard-pressed motorists need, is to pay over the odds for repairs."
The comments come 14 months on from Halfords first noting a "considerable softening of the cycling market", impacted by supply chain issues, inflation hitting customers' spending and a return to more normal demand following the Covid bike boom.
In June, Stapleton said he still remains "very, very confident" about the cycling market, despite the preliminary results for the 52 weeks to the end of March showing a 55 per cent fall in pre-tax profits.
"We're very, very confident about the cycling market in the mid-term," he said two months ago. "It still hits the sweet spot in terms of climate change, for example, and there is a big growth spill into electric bikes. We still think it's the right place to be."
Predicting this week's latest update, he added: "While the costs of energy, labour, and currency remains high, we do expect to see some deflation in cycling and rubber-based products."
The update from the UK's largest seller of cycling products and services comes a week on from the news that UK bike sales had dropped again, that after slumping to the lowest level in 20 years in 2022.
In yet more bad news for the bike industry, mechanical bike sales fell by eight per cent and e-bike sales by 12 per cent. Furthermore, the total market value of the cycle industry was revealed to have dropped by eight per cent compared with the same period last year.
Dan joined road.cc in 2020, and spent most of his first year (hopefully) keeping you entertained on the live blog. At the start of 2022 he took on the role of news editor. Before joining road.cc, Dan wrote about various sports, including football and boxing for the Daily Express, and covered the weird and wonderful world of non-league football for The Non-League Paper. Part of the generation inspired by the 2012 Olympics, Dan has been 'enjoying' life on two wheels ever since and spends his weekends making bonk-induced trips to the petrol stations of the south of England.