My thoughts on The Italian Job. Can Campagnolo Survive?

by John Satory November 16, 2011

Every once in a while, I find a cycling related article that I can actually read all the way thru without falling asleep or losing interest. The article in the latest Bicycling Magazine titled "The Italian Job" by Bruce Barcott that's about Campagnolo was one of them. Below are some of my thoughts that I took away from it...

  • Shimano cycle-division sales of $2.1 billion to Campagnolo's $150 million.... -Wow. I would like to know what SRAM's sales are...
  • No surprise that Campy's current market is older, more affluent riders. I find this to be true.
  • "About 95 percent of the bicycles and components sold today originate in Taiwan or China." - Wow. Just wow.
  • "Campagnolo employs about 400 people in Vicenza. Like most Italian workers, they are strongly unionized and well paid." - I expected more employees. I wonder if the unions over there are structured like ours here in the US...
  • "The electronic gruppo problem illustrates a larger dilemma for Campagnolo. Its engineers must not only compete with a company more than 10 times its size. Their executives must not only find profit margins while paying 10 times the hourly wage of its competitors."- What a challenge. This certainly is a reflection on the price differences between Campy and Shimano.
  • "The refusal to compromise quality moved Campagnolo from a company to a cause. Some call it a cult." -This is somewhat true.
  • "Technology transfer—some would call it idea theft..." - This is so true. There's a lot to be said about this...
  • "Romania—a country famous for a man who drank blood and another whose name included the phrase "the impaler." Its remote location and spooky cultural reputation act as their own barriers to technology transfer..." - Ha... That's funny but probably true.
  • "A combination of outsourcing fatigue (those long flights to Shenzhen for quality control take their toll), rising labor and transportation costs, and the let's-rethink-this mindset of the recession have dampened the business world's enthusiasm for Asian manufacturing." - This makes me very happy.
  • "If the demand for Campagnolo'stop-level $2,500 carbon-fiber groupset, the Super Record, exploded tenfold, the company couldn't simply hire 10 times as many skilled machinists and ramp up production. Those machinists don't exist..." - This is so true and a valid problem that most consumers, both IBD's and end-users, don't understand.
  • "FSA's Mukilteo headquarters—a warehouse and a tidy suite of offices staffed by young dudes and their dogs—Van Enkevort says, "I can't help but feel this was a vendetta against us for having the gall to compare our product to Campagnolo's..." - You can't compair a FSA crankset with a Campy crankset... a world of a difference.
  • "Tom Kattus...has one of the toughest jobs in the American cycling industry: He's the general manager of Campagnolo North America." - I'm going to have to agree with this statement.
  • "...fixing the new chain required a special, $299 tool—the most expensive chain tool ever produced. If you ask a bike mechanic making $12 an hour what he thinks of the new 11-speed gruppo, prepare to get an earful about the chain tool." - Yet another true statement. Crazy expensive even at wholesale cost.
  • "The United States represents only 14 percent of the company's sales..." - Interesting.

...this is interesting to say the least. I must say that I am more impressed with Campagnolo as a whole after reading this article. There's definitely something to be said about Campy and why they do what they do.

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