Peloton’s existential crisis rolls on. This week, the beleaguered home workout company announced that it will stop producing its own stationary bicycles and treadmills.
Peloton has been spinning its wheels for months now. Demand for its spendy workout equipment (the Peloton Bike starts at $1,445) surged at the beginning of the pandemic, and an overzealous Peloton responded by ratcheting up production. Then last year, it recalled its Tread+ treadmills after a child died in an accident with one of the machines. Peloton sales then plummeted, due to a combination of bad press and lack of demand as the market became saturated and potential new customers started to leave their houses again. Peloton’s stock crashed , it decided to temporarily suspend production of its bikes and treadmills, and company cofounder John Foley resigned as CEO and was replaced by former Spotify CFO Barry McCarthy.
The company tried to catch up and entice new users. It expanded its subscription service for streaming workouts. Despite its overstock problem, it even made new stuff, releasing a body-tracking webcam last April and announcing a rowing machine in May.
Now the company is backpedaling yet again. Peloton will still contract another manufacturer to build some of its equipment, it just won’t do it in the company’s own facilities. (Those are operated by Peloton’s subsidiary company, Tonic Fitness Technology.) Still, it’s a big shakeup for a company that, until earlier this year, had planned to spend $400 million to build its own manufacturing plant in Ohio. Peloton is riding […]