According to a confidential internal presentation dated January 10 attained by CNBC, Peloton has paused its Bike production for two months, from February to March, due to a “significant reduction” in demand attributed to heightened price sensitivity and competition.
The documents also indicate that Peloton will not manufacture its Tread treadmill machine for six weeks, beginning in February. The company does not anticipate producing any Tread+ machines in the current fiscal year ended June 30, 2022.
Peloton had previously halted Tread+ production after a safety recall last year.
The confidential document follows news earlier this week that it the maker was raising prices to deal with inflation. According to a banner notice on its website, Peloton will charge customers a $250 delivery and setup fee on some of its bike models and a $350 delivery and setup fee for some of its treadmills.
According to a report Tuesday from CNBC, Peloton also retained consulting group McKinsey & Co. to review its cost structure and potentially eliminate jobs. The report indicated its apparel division might see expense cuts, and 15 of its 123 global showrooms could close.
Shares of Peloton at early-afternoon trading today were down around 17 percent to $26.00 a share. Its 52-week range is between $23.25 and $166.57, and Peloton stock is now trading below its September 2019 IPO price of $29.
