Peloton will outsource all bike manufacturing to Taiwanese firm

BREAKING: Peloton will outsource all bike manufacturing to Taiwanese firm as part of rescue mission to turn around the struggling business

Exercise tech manufacturer Peloton will outsource manufacturing to a Taiwainese firm to try and save the ailing business.

The company has announced its bikes and treadmills will be made by Rexon in an attempt to simplify the business and reduce costs for the beleaguered firm.

Peloton had previously been manufacturing several of its products at its own manufacturing plant before splitting it between that and partners before today’s news.

Peloton’s Chief Supply Chain Officer Andrew Rendich told Bloomberg News in an interview. ‘We are going back to nothing but partnered manufacturing,’ he said. ‘It allows us to ramp up and ramp down based on capacity and demand.’ 

Former Peloton CEO John Foley (pictured) was embroiled in several scandals which have saw the company’s stock price collapse before his departure

Peloton has seen its stock price drop a staggering 93 per cent in the last 12 months

Peloton has seen its stock price drop a staggering 93 per cent in the last 12 months.

The company has seen several scandals which have taken it from trading around $120 last July to just $9 today.

In the first months of the pandemic, the surge in demand for home exercise equipment made Peloton into a stock market darling.

The company assumed its growth would continue even when gyms and leisure centres reopened – but this was proven to be wishful thinking. 

As the world has been reopening from lockdowns, growth slowed before myriad scandals caused the valuation to crash.

In March 2021, a child was killed in an accident involving Peloton’s $4,300 Tread+ treadmill, according to a letter that was sent by the company’s CEO to its customers.

A letter by then-CEO John Foley reiterating safety advice was addressed to owners of Tread+ was shared on Pelo Buddy, which bills itself as a site dedicated to ‘unofficial tips, tricks & guide to your new Peloton’.

A child was killed in an accident involving Peloton’s Tread+ treadmill (pictured)

Peloton co-founded and CEO John Foley shared news of the fatality in a letter addressed to owners of Tread+

‘While we are aware of only a small handful of incidents involving the Tread+ where children have been hurt, each one is devastating to all of us at Peloton, and our hearts go out to the families involved,’ Foley wrote.

More to follow… 

Peloton’s 12 months of disasters

March 2021: Peloton warns parents to keep children away from its Tread+ treadmills after a six year old child is killed after being pulled underneath one of them

May 2021: Peloton recalls the running machines after reports of at least 72 other injuries emerge. Class action lawsuits against the company are filed

June 2021: Firm is accused of greed after disabling ‘Just Run’ feature on Tread+ which lets users run for free, instead forcing them to pay a $39 fee. Brought the free option back after an outcry

August 2021: Peloton slashes cost of its entry-level bike by $400 as revenue growth slows 

November 2021: Peloton reports sales of its products fell by 17 percent for the most recent quarter, with the smallest gain in subscribers since going public in September 2019. That saw Peloton’s market cap tumble by $8 billion, and John Foley lose his billionaire status 

December 2021: Mr Big – played by Chris Noth – dies of a heart attack after using a Peloton in the Sex and the City reboot And Just Like That. Shares continue to drop. Days later, Peloton is hailed for producing an advert featuring the revived character joking about the exercise bike. But it is forced to pull the hailed commercial after Noth is hit by multiple claims of sexual assault, which he denies 

Firm hit by fresh scandal after John Foley hosts lavish Christmas party at CEO for select employees, after annual bash was scrapped for rank-and-file staff 

Chris Noth, who plays Mr Big in Sex and the City, dies from a heart attack after using his Peloton

January 2022: Leaked audio reveals plans to fire 41% of sales and marketing teams. Stock price tumbles further after it emerged production of bikes and treadmills would be slowed due to sinking demand.

Calls for Foley to be fired emerge.

The PR gets even worse as another TV character is almost killed off from a heart attack after a Peloton session. Showtime’s popular series Billions used the bikes to give Mike Wagner, played by David Costabile, a scare in the season six premiere. He survives, and declared he is not going to die ‘like Mr Big’

Mike Wagner, played by David Costabile, is seen in the Season 6 premiere of Showtime’s Billions having a heart attack after riding a Peloton bike

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