Shimano’s stock value is at an all-time high, and is predicted to rise still further as the Japanese company is expected to cash in on the increasing demand for disc brakes now that the UCI, the sport's governing body, has relaxed its rules on disc brakes in the professional peloton, according to a report this week by the Financial Times.
According to the report, Shimano’s stock value has risen 500% since 2012, with the company enjoying a dominant 70% global market share for groupsets. It expected to receive a further boost from the 2016 Rio Olympics. In fact, the company has enjoyed a 10% revenue growth in every Olympics as far back as Atlanta in 1996.
– Disc brakes to be permitted in peloton in 2017
But it’s disc brakes that analysts suggest are a ‘roaring “buy” signal for Shimano’. Disc brakes have been tested in select professional road races this autumn, as the UCI has relaxed its rules regarding the use of disc brakes in a pro race, with a widespread roll-out predicted for 2017.
“The technology, say analysts, is then likely to eventually become standard in the amateur racing bike market — a boon for the handful of high-end disc brake suppliers, Shimano dominant among them,” reports the FT.
– Team Sky races with disc brakes for the first time
We’ve already seen the choice of disc-equipped road bikes explode in recent years, with most bike brands now offering at least one disc road bike, and some companies, like Giant, even making a wholesale change on key models.
Of the three big groupset manufacturers, currently only Shimano and SRAM offer a full hydraulic disc brake groupset, and it’s Shimano that is clearly the favourite choice with product managers and customers. Italian company Campagnolo has yet to show any sign of committing to a disc brake groupset, and risks being left behind.
37 thoughts on “Shimano set to profit from disc brake demand”
How long will it be before we
How long will it be before we see electronic servo assisted disk brakes on bikes?
Quote:How long will it be
You can get Di2 suspension on MTB’s, so I wouldn’t image it will be long!
lushmiester wrote:How long
MTBs have had disc brakes for ages, and nothing like power assisted or ABS equipped brakes have appeared.
Disc brakes are easy to pull anyway, so why would you need power assistance?
Unless you are thinking ‘fly by wire’ or completely wireless brakes with the servo right at the caliper, but then you’d have to have a actuator at the lever and a whole load of sensors in order to provide ‘feel’ (as per F1 cars since 2014) so it would be really expensive and unlikely to gain you anything.
joules1975 wrote:lushmiester
I could be wrong, but I was getting the impression the OP wasn’t being entirely serioius…
wireless brakes…. it’s the
wireless brakes…. it’s the natural evolution
It’s due to the increase in
It’s due to the increase in popularity of fishing.
Read this article in the FT
Read this article in the FT this morning – it’s on front page. Seemed pretty shallow to me. Use in the pro peleton of itself will cause sod all difference to Shimano’s margins (I imagine DA disc groupset while profitable on a per unit basis – doesn’t move the dial in term of overall profitability for the Shimano group). Suspect when it feeds through to 105/Tiagra/Sora on an OEM basis uptick in profitability will follow. But not sure I’d be piling into Shimano stock on the back of UCI’s decision.
surly_by_name wrote:Read this
It’s not the money Shimano will make from the pro peloton using disc brakes, it’s the uptake by amateurs upgrading to disc brakes. Disc brakes are pretty popular with non-racers at the moment, but if the pro peloton switches to disc brakes, it’s likely many more people will also upgrade to disc brakes. Whether that’s a good thing or not is another matter entirely
David Arthur @davearthur
Kind of.
Purchases of individual components (“amateurs upgrading”) are, I would wager, a rounding error when taken against OEM sales. (And amateurs aren’t going to upgrade to DA in the quantities that will deliver the significant increase in profitability that apparently informed analysts seem to think.) OEM sales about negotiating with bike manufacturers, who don’t want to/can’t afford to spec DA in volumes required – sweet spot somewhere between 105 and Tiagra. So if I was putting my cash into Shimano stock, I’d be aiming to do so just ahead of release of 105/Tiagra 11 speed integrated hydro/11sp shifter.
surly_by_name wrote:Read this
The fact that you’re reading the FT yet don’t quite grasp what this article means is laughable.
Iamnot Wiggins wrote:The fact
I am pretty relaxed that I was able to grasp the point of the article, I just don’t agree with the conclusion that underpins it. But just in case I didn’t, could you please enlighten as to “what the article means”?
If you could make the
If you could make the components robust and light enough, i.e a hydraulic servo, sensors and associated electronics, then why not ABS as a natural progression?
Whether cyclists ‘need’ it or not is certainly debatable but new features are generally good for sales.
Mungecrundle wrote:If you
Whether cyclists need it or not is not debatable it’s irrelevant.
Mungecrundle wrote:If you
A large number of people don’t think we need discs, so the idea of ABS will have some having major fits.
Electronic disk brakes….a
Electronic disk brakes….a flat battery or a spot of damp on a rainy day might make for interesting experiences!
The value of the share prices
The value of the share prices may go down as well as up.
as a side issue to this, i
as a side issue to this, i wonder what the difference is in sales between newbies choosing disc road bikes over caliper braked models specifically on their first bike and ‘experienced’ roadies choosing a disc braked model as an upgrade from an older caliper model?? I would imagine it’s somewhere in the region of 80-20…my LBS says disc brakes are the easiest sell in the world to a new customer, even though they really aren’t that necessary…I find my campag brakes on aluminium rims are as good if not better than a disc set up…
il sole wrote:as a side issue
You clearly can’t have tried a decent set of bedded in disc brakes then (TRP spyre or hydraulics, cause with the exception of a couple of others, the majority of cable discs brakes are indeed no better than a decent rim brake).
joules1975 wrote:il sole
I have TRP spyre HyRd on my cross bike and they are inferior to my campag SR rim brakes. I rode a cannondale synapse with hydraulic ultegra brakes in gran canaria this year and wasn’t overly impressed with those as it happened.
I wasn’t arguing for/against, I was just curious as to whether most sales of disc brakes are going to people new to road cycling as opposed to those changing from rim brakes…
il sole wrote:
I have TRP
The Spyre and the HyRd are two completely different brake models.
If you’ve got the HyRd and you think they’re not as good as rim brakes then you’ve either got a crap mechanic or you’re smoking something …..
il sole wrote:
I have TRP
I have hydros on my MTB and cantis on my road bike and commuter. I can’t get over the difference in feel between using actual devices engineered to achieve optimal deceleration versus what never ceases to seem like a very slightly evolved version of jamming a stick against my rim. But as always, to each his own, YMMV.
Well I went bike shopping a few weeks ago and MTBing friend tagging along asked for a quote on a carbon bike with hydro brakes. The clerk (nice, low key dude) was really surprised when he asked for an equivalent to a MTB 17.5″ and actually advised him against spending that much on a first road bike. He said something to the tune of “why don’t you start off with alu and cable brakes and if you feel like you really need them we have a 30-day return window for an upgrade”. They had a pretty good selection of hydro-braked road bikes in that shop. So I’m guessing (from a really small sample of anecdotal evidence, to be fair) that a large chunk of the disc brake market is comprised of road veterans.
before we get on to the
before we get on to the benefits of disc brakes, and there are some. This article bascially sums up the problem and it is more relevant to the MTB market at the moment, change for the sake of change, to simply drive sales. It is nothing about the end user experience and all about selling units. The money is in OEM so make it that you can’t upgrade easily, that you have to replace the entire bike.
mrmo wrote:before we get on
Yes and no.
Clearly most things the bike or indeed any other industry come out with is to drive sales – that’s hardly a surprise. However, out of all these innovations come some that are definitely worth having – the debate in my view is more about when to upgrade, not if. i.e. upgrade when you existing stuff wears out or when there is a very clear and fairly significant advantage.
What slightly goes against your argument is that disc brakes result in less wear on brakes and rims, so for example if everyone switched to discs the wheel companies will in theory sell fewer wheels, cause we won’t be wearing them out by using them as a braking surface (shimano being one of those wheel companies). So disc brakes could only be a short term gain in sales, and longer term loss.
joules1975 wrote:
Clearly
Which is solved by launching a new wheel size/hub width…
We just seem to be entering a period where there are NO standards, what headset do you need? What bb do you need, what is the hub width…. Basically getting to the point that if something has worn out it will mean new bike and not new component.
mrmo wrote:joules1975
You’ve got that right, back in the day only Peugeot and Raleigh used odd standards,you could fit just about anything to most frames with no compromises.
These pages are littered with bottom bracket and headset noises,failures and all sorts, that simply never used to happen.
These new systems are usually designed to be faster for the factory to install without adjustment and are generally made of low rent materials that can’t stand long term fatigue ….oh but when new they’re stiffer and are lighter ! ( unit you start adding shims and washers)
Let’s face it, bikes are a mature technology, the industry is farting about scratching for a ‘new’ offer constantly, but other than the use of carbon and power meters. nothing has made road bikes any better.
Di2/ EPS ….weight!
Discs…..more weight, pointless in the peloton.
Aero…..been there, we all know these don’t really work other than in a TT constant position if you don’t move your head.
STI’s Shimano didn’t think about the ‘over the top’ going across the cassette, thankfully, Campag did.
Yes, I am still on friction, I miss the odd gear, but can go across the cassette in a heartbeat.
As one who eschews modern
As one who eschews modern fanglement, I too can’t see that in dry conditions, that discs of any type offer a benefit over cable operated V brakes.
Both are, I concede, better than any calliper type I have tried, Record included.
Road.cc- how about a premium
Road.cc- how about a premium rim brake vs hydraulic disc brake real world shoot out? Stopping distances wet and dry, descending, feel at the lever etc. Mix it up with Exalith too.
Wow 70% of the market –
Wow 70% of the market – that’ll be a licence to print money then. And that’s only going to increase as Campag have clearly thrown in the towel & SRAM are well, SRAM.
That said little or no effective competition can’t be good for consumer choice, low prices or product innovation in the long run 😕
In 2 years time we’ll have
In 2 years time we’ll have forgotten all about this debate and rim brakes will be dead on all new bikes. Discs are fine by me. No more scored rims and sketchy wet braking.
Hydro discs are only a year
Hydro discs are only a year away from being part of a £400 group-san, and will be spec’d on road bikes well under £1k. Soon every C2W commuter will have them, and we will wonder what we were ever thinking grinding rims to paste during 3 out of 4 UK seasons. Plus why we ever put up with stopping distances measured in HGV lengths, requiring a telegram a day ahead to advise of the need to start drying off the rims.
Biggest looser? Jagwire/Kool-Stop et al. When was the last time you purchased a MTB brake cable or pad? Even with three seasons of adventure racing included, my MTB is on to its 3rd set of £10 pads in a decade.
Soon calipers will go the way of the toe strap, only to be seen at twee vintage outings. Good.
The downside, riding a bike
The downside, riding a bike may become a lot less peaceful.
I’ve got discs on two bikes, and they’ve both had times when they screech badly in the wet. I’m not necessarily looking forward to riding in London on a rainy day, with all the bikes stopping together at junctions making that noise.
But I wouldn’t buy a bike for commuting now without discs.
So Shimano’s profits will go
So Shimano’s profits will go up as they will be increasingly specified as OEM on new road bikes and they will shift more complete groupsets. Good for them, but not so good for the consumer who’s already invested:
The term ‘upgrading’ to disc brakes is misleading, since it requires a completely new bike (frame, fork, wheels and half the groupset!) – hence the increase in profits for the company, more complete units sold, more perfectly good components into obsolescence.
The points about standards is well made in the comments here by Mrmo & FlyingScot – having looked into replacement framesets recently for my broken one, I find that to get something modern in carbon I can no longer screw the bb bearing cups into the frame directly, or sit bearings outboard as intended by Campag – I have to get extra components/ adapters and tools and introduce play and most likely creaking into the whole system. Trying to fathom the ten different BB ‘standards’ is a nightmare. Some manufacturers specify a completely different frame if I want electronic gears compared to if I don’t (and I don’t).. and don’t get me started on 1.25″ steerers – WTF!
The whole system is designed by manufacturers to make me get rid of perfectly good components, not to repair and service parts but to replace them completely on a 2 year lifecycle. Who here can properly service/ adjust a disc brake? (bet not as many as who can fix a rim brake!). Who can repair a Di2 system?! I’m as avid a consumer as the best of them, but in trying to be green by cycling we find we’re buying completely new bikes & components every couple of years then we’re undoing our good work with the environmental costs in manufacture and shipping everything half way round the world!!!
The more that this single company (Shimano) dominates, the more we’ll be encouraged to waste, which is a huge shame.
700c wrote:…
The term
Frame manufacturers are reacting by sticking with BS 1.37″x24TPI outboard – even on very high-end bikes. With Ultegra-spec bearings hovering around the £20-mark there is simply no need to look anywhere else. Anyone saying they can notice the difference between BB30 and a 24mm Hollowtech II can Get In The Sea.
700c wrote:The points about
While I agree with you concerning the scourge that is the proliferation of BB standards, discs are a bit simpler to service and adjust and loads of people are familiar with them thanks to over a decade of use on mountain bikes. Your first bleed is typically a nervous, messy affair (or maybe that’s just me) but it’s gets easier. Also, set up is very easy because hydros are self adjusting. Bolt on, back bolts off, squeeze lever, tighten bolts to 8Nm, that’s it. Easier than side pull callipers and a waaaaaaaaaaaaaaaaaaay easier than cantis.
Rotor size isn’t a big issue – I think some manufacturers seem keen on pushing 140mm for road use. This may be optimal from a performance perspective (bigger rotors weigh a bit more and the extra braking power probably not needed on road) but 160mm is pretty ubiquitous and I would be surprised if this isn’t the most specced size when the dust settles. In any event all wheels will take either size rotor as will most frames (and if they don’t its a £9.95 problem).
Some lack of standardisation of mounting style. Post mount seems to have been superseded by “flat mount”. This is a £2.95 problem (adapter to convert flat mount to post mount).
Axle standards still all over the place, although not helped by fact that mtbs also have plethora or difference axle standards (20mm for DH, 15mm for everything else; 135mm x 12mm; 142 x 12mm; boost). Wheel (and hub) manufacturers have decided to manufacture hubs with replaceable end caps rather than wait for manufacturers to reach a landing on a single standard. So again (usually) not a very expensive solution.
The real difference between road and mountain bikes is the effect of integrating your brake lever and your shift mechanism. I can run Shimano shifters and SRAM brakes on my mtb (or vice versa; or Hope, TRP, Magura, etc brakes) without giving up anything (other than maybe an extra clamp on the bars – and problem solvers can fix that as well). This isn’t currently possible on a road bike, so if I want to run SRAM shifters then I need to use SRAM brakes. This isn’t the end of the world, but it does reduce competition (which may explain why road disc brakes as still so ludicrously expensive when compared with their MTB cousins). So all of the manufacturers that make hydros for MTBs are essentially locked out of the road market because they don’t also do shifters. Ironically, electronic shifting may be the answer for these firms. If you could develop a stand alone electronic (ideally wireless) shifting system that could be integrated into a pair of brake levers you could open up the market for more competition. Some combination of the shimano junction box under the stem and the remote buttons from SRAM’s new e-tap system; all you would have to do is cut the right channels into your the body of your brake lever mount to allow the cables and buttons to be routed beneath the hoods so they are where you need them. No manufacturers have any incentive to do this because they want to sell an integrated system.
Nobody’s forcing you to buy
Nobody’s forcing you to buy anything.
A. Deore Hydraulic MTB
A. Deore Hydraulic MTB brakeset circa £80.00
B. Shimano 105 STI levers circa £110.00
C. Shimano R785 Hydraulic STI system circa £450.00
A + B << C This is how Shimano are set to profit.
overshoot wrote:A. Deore
Yep, agreed. Even though your example gives a better picture of Shimano’s margins, here’s to crossing the i’s and dotting the t’s 😉 :
A. Shimano SLX M675 Brakes £80.95
B. Shimano Ultegra 6800 STI Levers £144.95
C. Shimano ST-RS685 Hydraulic Disc Brake STI’s & BR-RS685 Disc Brakes £389.95
A + B < C Even though C is a packaged deal in both senses. However you look at it Shimano is probably making a pretty penny from its road disk brakes, while cornering the market at the same time. SRAM and Campagnolo (and Rotor/FSA/whomever) have a lot of catching up to do.