Pedego Electric Bikes
A love of cycling and dislike of hills prompted the co-founding of Pedego Electric Bikes.
In 2008, Don DiCostanzo and Terry Sherry were at lunch talking about what they wanted to do with the rest of their lives. They were both 50-something serial entrepreneurs who were in between ventures. Best friends since college, they loved cycling but hated hills. They loved the concept of electric bikes but hadn’t found a really great electric bike. Despite having no bicycle industry experience, they decided to create their own. Over lunch, they designed their first bike on a napkin. The first Pedego electric cruiser bike was designed with a nostalgic look reminiscent of 1950s beach cruisers.
Overcoming Challenge #1: Manufacturing in China
Manufacturing challenges included persuading big-name bicycle components companies to allow Pedego to use their parts. Most were unfamiliar with electric bikes and were reluctant, but DiCostanzo was highly persuasive. Another challenge was finding the perfect factory in China to manufacture the bicycles, eventually they found one.
Overcoming Challenge #2: Distributing Electric Bikes
In 2009, the first Pedego Comfort Cruiser bikes rolled into the market. However, distributing the new bikes proved to be a challenge. Traditional bike stores were not interested in selling electric bikes since most U.S. consumers didn’t even know what they were. There was just a handful of electric bike stores at that time.
Realizing that getting customers on Pedego electric bikes was the only way to sell them, DiCostanzo devised the concept that would give them a competitive advantage. Individually owned and operated Pedego-branded stores would offer potential customers free test rides, and affordable tours and rentals. The first store, Pedego Huntington Beach, in California, opened in 2011. Today, there are more than 140 stores worldwide, including 100 in the United States.
The entrepreneurial duo created the opportunity for other entrepreneurs to become store owners. Most stores are owned by couples, families, and millennials who enjoy the outdoor lifestyle. The majority are people aged 40+ who are in their second careers after retiring, being displaced from other careers, or simply deciding to make a career change.
Overcoming Challenge #3: Electric Bike Ban on California Bike Paths
Pedego was hit with another challenge in 2015 when some California cities decided to ban electric bikes on bike paths. DiCostanzo and Sherry supported their local assembly member, Matthew Harper, on California Bill 1096. It went into effect on January 1, 2016, allowing electric bicycles to go anywhere conventional bicycles can go, such as bike paths, throughout California.
Since then, DiCostanzo has become involved in supporting laws that improve electric cycling nationwide. As a result of his efforts, today, electric bikes are legal everywhere conventional bikes can go. He continues to visit Washington DC to advocate on electric cycling every year with the League of American Cyclists.
Overcoming Challenge #4: China Tariffs
In 2018, Pedego faced a new challenge: China tariffs. In August, the U.S. government enacted a 25-percent tariff on nearly 300 Chinese-made products, including electric bikes. The tariffs affect every Chinese-made bicycle, electric or not, as well as nearly 5,000 other Chinese-made goods in a wide variety of industries, from aluminum and steel to farm equipment and baby cribs.
In July, DiCostanzo testified in front of a U.S. Trade Representatives panel to protest bicycles being on the tariff list because they do not fit the goals of preventing China from stealing intellectual property or bringing bike manufacturing back to the United States. He argued that manufacturing bicycles in the United States would double the price. Unfortunately, his testimony did not sway the outcome.
However, prior to the China tariff decision, Pedego had already planned its expansion into Vietnam in response to the European Union’s 83-percent tariff on Chinese-made electric bikes, which was announced in the spring. With the August confirmation of U.S. tariffs on Chinese-made bikes, they decided to move Pedego manufacturing out of China. Production moved to two factories in Vietnam and a second factory in Taiwan. Both countries have no tariffs.
Pedego still pays tariffs on Chinese-made bike parts. For example, the throttle on every Pedego electric bike is a part almost entirely made in China. But their foresight in planning the move to Vietnam and ability to make it happen quickly has enabled Pedego to keep prices fairly stable.
Along the way, Pedego has become a big supporter of charities, both locally and globally. In 2017–2018, the company was a silver sponsor of HomeAid OC, a charity that focuses on fighting homelessness. It also sponsors Wells of Life in its mission to bring clean water to Uganda. In 2014, Pedego created a hot pink Ford-branded bike to raise funds for Ford’s breast cancer charity, Warriors in Pink.
Pedego regularly makes donations to provide wheelchairs around the world through the Free Wheelchair Mission. In addition, each year, hundreds of its bicycles are provided to charity organizations for fundraising. DiCostanzo also speaks to students at his alma mater, CSU Fullerton, every semester.
A Green Alternative for Transportation, Exercise and Recreation
Pedego integrates the latest in electric bicycle technology and delivers a green alternative for transportation, exercise, and recreation. Innovative models include cruisers, commuters, mountain bikes, fat-tire trail bikes, cargo bikes, folding electric bikes, a trike, and even one with an extra-low step-thru for riders who cannot lift their legs very high. Pedego is the only company to offer 20- and 24-inch electric bikes for smaller riders, including kids.
Pedego riders enjoy the outdoors and riding longer, farther, and faster than they ever could on a traditional pedal bike. People have become fit while riding their bikes, including one woman who lost 270 pounds. Pedego bikes allow riders with injuries and other ailments to enjoy biking again. Many people commute to work by Pedego bike. Customers say their lives have been transformed by their bikes. Famous customers include William Shatner, Martha Stewart, Denise Austin, to name a few.
Pedego Is the Number 1 Electric Bike Brand in the United States
Today, Pedego is the number 1 electric bicycle brand in the United States and is the fastest-growing electric bicycle brand worldwide. Its secret sauce is delighting its customers with its innovation, quality, and customer service — the top core value of the company. Making its store owners successful is equally important.
The company has grown an average of 46 percent each year from 2012–2017. Future plans include opening another 200 stores over the next five years. New products for 2018 included a full-suspension mountain bike and several new commuter bikes.
Pedego’s success has been covered in Inc. Magazine (March 2017); the Wall Street Journal(October 2017) and many TV news programs, magazines, and newspapers worldwide. Pedego has been ranked on the Inc. 5000 for five years (2014–2018). DiCostanzo was the Orange County Business Journal’s 2016 Entrepreneur of the Year and was a finalist in Ernst & Young’s 2018 Entrepreneur of the Year program.
DiCostanzo and Sherry’s objective was to build the best electric bike company. They didn’t set out to build the biggest electric bike company, but now Pedego is both. Learn more about Pedego by visiting www.pedegoelectricbikes.com.