John Paul M. Joaquin Tech 08.16.2022 01:Aug AM EDT

Will Peloton Make You Assemble Your Bike Yourself Soon?

If you're planning to get a Peloton bike anytime soon, you may have to think it came from IKEA.

Peleton CEO Barry McCarthy is currently thinking of redesigning the company's bikes so end-users can assemble them independently as part of its ongoing restructuring plan to reduce the company's costs, per The Verge.

Peloton went ahead in its restructuring plan in early February, with McCarthy becoming the company's new CEO and his predecessor, John Foley, being placed as executive chair.

Do-It-Yourself Peloton Bike Assembly Details

McCarthy mentioned in his interview with Bloomberg that Peloton was planning to redesign its bikes that would allow customers to assemble them at home.

Currently, Peloton's treadmills and bikes require white-glove delivery in separate pieces and a Peloton crew that will build the bikes and treadmills for customers. This service used to be free, but Peloton began charging an additional $250-$350 at the end of January 2022.

With Peloton's redesign, customers will be able to assemble the bike by themselves easily without the need for a Peloton crew.

Slash Gear also reported in its article that Peloton might be going for the IKEA effect. This effect happens when a customer puts their own time and effort into assembling an item, such as the redesigned Peloton bike, the item's worth goes up in their eyes, per a research paper published in the "Journal of Consumer Psychology."

The redesign will also allow Peloton to ship its bikes through FedEx, further lowering the cost on the company's part.

McCarthy said that the redesign is "a real thing" and that the company has been working on it for quite some time. However, it isn't known when the "do-it-yourself" bike is coming to store shelves.

In addition to redesigning Peloton bikes, McCarthy is also considering a plan that would let Peloton app subscribers potentially view workouts in third-party workout machines.

Why Peloton Is Considering 'Do-It-Yourself' Bikes

Peloton has been suffering from a massive and unexpected drop in sales in early May, which caused its shares to slump by as much as 29% for the 3rd quarter of the fiscal year for 2022.

However, the decrease follows a slowdown in demand that happened during the early months of 2022, causing the restructuring and appointment of McCarthy as CEO.

The slowdown in demand and the massive unexpected drop in sales has hurt Peloton's profits and revenue, causing them to consider "Do-It-Yourself" Peloton bikes and view Peloton workouts in third-party workout machines.

Those are not the only measures Peloton is willing to take. To recover from the slump and decrease in sales, the company significantly increased the price of its Tread and Bike+ bikes while laying off approximately 800 people from its distribution and customer service departments.

At this point, Peloton has already laid off 4,170 people, with 2800 people let go in February while another 570 in Taiwan were laid off in March.

McCarthy hopes that the changes made in the company will allow it to progress its strategic plan and better position the business for long-term success.