Question on R&M Packster 2018 pricing and exchange rates

[doublemazaa]

I am considering a Packster 80, and have two questions regarding R&M's pricing.

According to this article, a Packster 80 Touring CX was $5,149 in 2017, and now is $6,439 in 2018. Why the huge increase? Did they substantially change the bike to justify a 25% price increase?

Secondly, that same 2018 bike is available in London today for £4,139, which is ~$5,450. That price includes VAT, whereas the US price does not include sales tax. So the out-the-door price of the bike in the UK, is ~$5,450 vs ~$7000 somewhere in the US with ~8% sales tax. A US buyer buying the bike in the UK would pay only £3,449 (~$4,531), plus whatever it costs to import to the US. That might be pricey, but likely not $2,500.

FWIW I have had Canadian retailers tell me there are no import duties for bringing a R&M bike purchased in Canada across the border to the US, so I suspect the cost of getting it back to the US wouldn't be more than shipping of around $500, and paying use tax locally.

I suspected that shipping/logistics from Europe might make the difference, but even in Australia, the same base bike MSRPs for AU$7,979, or US$5,854 GST included (or AU$7,253/US$5,321 with it excluded).

Can anyone enlighten me as to what might be up for the 2017 vs 2018 pricing, and US vs elsewhere pricing?

Thanks!

 

[Chris Nolte]

I don’t know all of the details around this but I will share what I do know. The currency fluctuations in the US have played a big part. At the moment the exchange rate is about 1.16 and this Spring it was closer to 1.26 and looking like it would increase. R&M artificially offset the shipping prices for the first year in the states, but they’re not able to keep that same subsidy. Shipping cargo bikes to the US from Europe is quite expensive. I import bikes regularly and it can cost upwards of $1000 per bike but you do save money when consolidating shipments.

They’re also buying motors and batteries in different quantities because the motor systems in the US are different than the UK and AUS. The US and Canada systems are unique to this region due to UL and different top speed. Beyond that, insurance in the US is higher than anywhere else due to how litigious we are as a society. Many companies won’t sell to the US for that reason. Technically I don’t think you would be covered by that insurance if you were to import the bike as you would be the importer of record, not R&M.

This is a complex topic and I hope I’ve helped to clarify. The rest of the industry will probably raise prices next model year on account of tariffs and such, but these prices will likely hold. Pricing these products is not an easy job and I assure you there is way more that goes into it than face value.

 

[doublemazaa]

Thanks for your thoughts Chris, I appreciate them, as well as everything you add to the ebike community.

 

[Alaskan]

That was a great question, something that really did need clarifying. Chris's answer was specific, informative and right on the mark.