Thursday, July 7, 2011

The Death of Schwinn

I suppose that when the Schwinn company told Charley Kelly and Gary Fisher that they had probably sold a mountain bike to everyone who would ever want one, and passed on their product pitch, that might have been the beginning of the end.  But, the nail in the coffin for the family-owned company came a few years later.  And, mountain bikes still played a large part.

Schwinn had finally gotten into the mountain bike business, after seeing the success of companies like Specialized and TREK.  And, just like everyone else, they outsourced the majority of their production to Taiwan.  Instead of dealing with Miyata, or Panasonic, or any of the other Japanese-based companies, they struck up a deal with Giant - the Taiwanese Goverment-subsidized tubing manufacturer.

Giant produced mountain bikes for Schwinn in great numbers, for a few years.  Then, one year, Schwinn found a cheaper supplier and dropped Giant with no warning.  This left Giant with a pile of bikes, and no outlet to the American market.

So, Giant branded the bike with their own name, set up a dealer network, and flooded the market with better, cheaper bikes than what Schwinn was selling.  Not too long after, Schwinn ended up on the auction block.

A loud whirring sound was heard emanating from Ignaz's grave...

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