Here’s a new example of dynamic, creative capitalism: shifts in relative prices of urban transportation (i.e., high gasoline prices) have increased the number of urban residents who use bicycles for transportation instead of/in addition to sport and fitness. This shift in relative prices and previously-untapped demand has led to a new product market: the urban bike. I’ve noticed this phenomenon over the past couple of years (it’s obvious at every bike shop in Chicago), and today Wired reports on the phenomenon from Interbike 2007, one of the largest bicycle trade shows.
Traffic snarls, soaring gas prices and worries about global warming have prompted a big boost in cycling, affecting even places like Los Angeles — America’s freeway capital — that have traditionally given bicycles the cold shoulder. …
At Interbike 2007, the bicycle industry’s giant annual trade show, the shift toward the urban rider is loudly evident. Fancy road and mountain bikes are clearly no longer king of the roost — or road. It’s the scads of fixed-gear, town, single-speed and other urban bicycles that are drawing the crowds.
The rise of the urban biker is reflected in Specialized’s 2008 catalog, which lists 34 different models of city bike to choose from.
My informal data support this observation; I’ve noticed lots more bikers on the streets, especially this summer, and they’re riding fixies and urban cruisers that have hip style (Me? I stick with my trusty steed, my tri-customized Felt F70, or my mountain bike for cruising around town).
This is a great example of changing economics and changing values leading to new product markets, and in this particular case, markets with lots of attention to design. Virginia Postrel, call your office!