As you can read elsewhere on Bicycling Trade, Pon.bike’s parent company, Pon Holdings has just launched the most expensive takeover bid in the history of the global cycling industry.
Sure, their target the Accell Group made a profit of $45.5 million last year, but at the takeover initial bid valuation of $1.19 billion, that’s still a very high price earnings multiple of 26 times earnings – a number you’d usually associate with a tech company takeover, not a bicycle company.
Are they paying too much?
I don’t think so. Here’s why.
Firstly, for some background I’d urge you to read my related article, ‘Why Pon is Going Bike?’
In case you don’t read that article, in summary it says that, Pon.bike’s parent company, Pon Holdings is a $10 billion plus per year automotive centred company with 13,000 staff. They don’t make cars but sell and service millions of them.
Like other companies that have strong automotive links, including Bosch, Pon have decided that bicycles have a bright future.
Meanwhile, although these companies might not be so public in saying so, I also suspect that agree with my thoughts that the future of the automotive industry will be challenging to say the least.
Here are some of my predictions for how things will look in 20 years’ time. Keep this article for future reference and you can wave it in my face in 2037 while you laugh at how wrong I was.
By then most of the cars on the road will be electric powered. Not good news for service station owners. I almost wrote ‘most of the cars being driven on the road’ but that’s another change coming, they’ll be self-driving. And a lot of them won’t be privately owned. You’ll call up a car when you need it.
It will be transport as a service not as something you buy anymore. Just like you already don’t buy music or movies anymore, but subscribe to Spotify, Netflix or whoever.
All of these changes to cars will mean that we’ll need a lot less of them, they’ll last longer, we’ll need a lot less mechanical servicing, fewer professional drivers and no petrol.
It will all be much more efficient, but pretty boring! How are you going to have some fun, feel some freedom get some exercise and express yourself?
Bicycles will be a great option, whether you prefer entirely human powered or with electric power assist.
Our roads will be less polluted and safer to ride on. They’ll also be quieter – in the noise sense of the word at least. They’ll still be busy, because our cities will hold more people who are more densely packed together than they are today.
Overall it will be a much more amenable environment for cycling, so more people will be enticed to do it, so it will be better catered for by government and industry, and so the virtuous cycling will continue to spiral upwards.
By 2037 people who got on at the ground floor and bought key global bicycle brands and technology back in 2017 will look pretty smart. Just like Forrest Gump when he bought shares in ‘some sort of fruit company’ that turned out to be a start-up called Apple.
All I’m doing is looking at existing new technology and social trends and projecting them forward along a logical progression.
Only time will tell how accurate my description of 2037 will be, but I hope it’s around the mark, and suspect that Pon.bike hopes it is too.