Rad Power Bikes is exiting Europe to focus on US e-bike sales

Six years after first opening an office in the Netherlands, Red Power Bikes is branching out to Europe, in an effort to enter the region’s bike-friendly market. Around 40 employees will be laid off by the end of the year, and the Seattle-based company will no longer sell its electric bikes to customers in the UK and EU from 2024.

Instead, the e-bike company will double down on its efforts in North America, where Rad thinks its brand is strongest. In an interview, Phil Molyneux, CEO of Red Power Bikes, says the move was necessary to sustain his business and achieve long-term success.

“This change really allows us to continue setting the standard for the e-bike revolution in North America, which, as you know, was our starting place,” Molyneux says. “And to continue to have a real laser focus on safety, reliability, constant innovation, going into the future and aspiring to deliver the highest quality products at affordable prices for our customers.”

He further added, “In this way we have returned to our roots.”

The move is the latest setback for the company, which in recent years has established itself as one of the fastest growing e-bike brands in the world. The Covid-19 pandemic has led to a boom in bicycle sales, and especially e-bike sales. Red Power Bikes has raised $329 million in private investment since its 2007 launch. And although the company doesn’t release its sales figures, Molyneux says it has more than 600,000 customers worldwide.

But Raid has struggled to maintain its position amid the economic downturn. the company has four rounds of sorting From April 2021, when it declined by 100 places. An additional 63 employees were cut in July 2022, followed by a third round of layoffs in December and a fourth in April 2023. According to LinkedIn, the company currently has 424 employees.

“It was necessary to undergo some force reductions,” says Molyneux. be right-sized for the current outlook of the

In addition to the layoffs, the company has faced several other challenges, including a wrongful death lawsuit, a lawsuit related to property damage, and a safety recall of nearly 30,000 electric cargo bikes for misaligned tires.

The recall was a blow to Raid’s reputation. The company said it has received 137 reports of tire bursts, deflation and separation from sidewalls. Eight injuries were reported, including “five incidents of road scrapes, cuts and/or bruises and one report of a broken wrist and one report of a broken hand”. and wrongful death lawsuit, in which the parents of one 12 year old girl who died RedRunners are suing the company for negligence after falling off the back of a utility bike, highlighting the lack of regulations for the booming e-bike industry in the US.

Meanwhile, a spate of battery fires, many of which were fatal, have shone a harsh light on the industry’s over-reliance on cheaply made batteries, many of which are made in China. New York City, where many of the deadliest fires have occurredrecently enacted a package of laws Selling an e-bike legally requires obtaining UL certification, the gold standard for safety compliance. (No Red Bike has been implicated in any of the fires.)

In January, a few months after replacing founder Mike Radenbaugh as CEO of Red Power Bikes (Radenbaugh remains board chairman), Molyneux sent a letter to customers acknowledging “mistakes” and vowing to make improvements. Issued.

In an interview, Molyneux says that the company has done much to enhance its quality assurance process in which e-bikes are tested before being sold to customers. “If we find a problem with one of our bikes, we own it,” he says, “and we communicate with customers and then we develop solutions and take full ownership of fixing everything.”

Rad is also seeking UL certification for its e-bike, which it hopes to receive before the New York City law goes into effect in September. According to the company’s FAQ page, Raid’s current lineup has been tested for UL 2849 and UL 2271 or UL 62133 compliance, “even though it is not required”.

There are few laws at the federal or state level regarding e-bike safety or operation. Some states have created incentive programs for customers to purchase e-bikes, encouraged by studies showing that e-bikes are a more environmentally friendly means of transportation that owners use in place of car trips. A bill has been introduced in Congress that would implement a $1,500 rebate on new e-bike purchases.

But with safety concerns on the rise, Molyneux says he expects – and welcomes – more regulation from local government. “It’s good to make sure quality bikes are coming to market,” he says. “And it would be great for the whole industry to move forward in the right dynamics.”

Several states, including California, have passed laws prohibiting children under the age of 16 from operating an e-bike. Red requires customers to confirm that they are over 16 years of age in order to purchase the e-bike. But Molyneux says more work needs to be done to encourage the safe operation of bikes, especially to install infrastructure such as bike lanes.

Despite being around for 16 years, it’s still early days for Red Power Bikes. The company is going through a familiar cycle of rapid growth followed by rapid decline that many other startups have experienced. But Molyneux says he is confident Red will emerge on top.

“We care about this industry,” he says. “We want this industry to grow. And we want to get more people out of cars and onto bikes – preferably Red Power Bikes.