Bike Ownership and Behavior, (Iii) Shopping Behavior, and (Iv) Willingness-To-Pay for “Sustainable” Bikes

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Bike Ownership and Behavior, (Iii) Shopping Behavior, and (Iv) Willingness-To-Pay for “Sustainable” Bikes 0 Executive Summary Specialized Bicycle Components, the third largest bicycle brand in the United States, partnered with the Nicholas School for the Environment (NSOE) at Duke University to better understand the environmental impact of bicycle manufacturing, determine where the bicycle industry might best focus its future improvements, and determine the current state of interest for sustainably made bikes. This research was conducted between May of 2013 and May of 2014. As indicated through the limited amount of published environmental programs, the bicycle industry has done little to address its impact. The outdoor industry, however, transparently communicates the environmental and social work it’s doing. The Outdoor Industry Association (OIA) has been dedicated to lessening the environmental impact of the outdoor industry’s manufacturing processes for several years through brand collaboration in the Sustainability Working Groups (SWG). While the Bicycle Product Suppliers Association (BPSA) is a member of the OIA, it has not participated in any of the OIA SWG endeavors (Outdoor Industry Association, 2013). Specialized did, however, join the OIA with the specific intent to encourage the creation of sustainability metrics appropriate for the bicycle industry (Bainbridge, 2014d). Perhaps the outdoor industry is ahead of the bicycle industry in addressing sustainability due to a lack of negative attention from environmental advocacy organizations. Recently there has been some indication that the bicycle industry has started to become interested in supply chain sustainability through the 2009 release of the Trek Eco Design bicycle line, the start of U.S. carbon recycling programs, and a recent panel discussion on sustainability at the Bicycle Leadership Conference (Bicycle Retailer and Industry News, 2012; Huang, 2009; Staff, 2013). The goal of this report was to quantitatively analyze the sustainability of processes used to manufacture Specialized’s bicycles and to qualitatively determine the current state of interest for sustainably made bikes. A life cycle assessment (LCA) was performed to quantify the impact of a Specialized Roubaix 56cm frameset, a Specialized Allez 56cm frameset, a DT Swiss R24 Spline wheelset, and a SRAM PC 1071 bicycle chain. The OIA Equipment Index was piloted to assess Specialized as a brand and the two framesets considered. Finally, a consumer survey and a media analysis were conducted to evaluate progress within the industry and hypothesize consumer perceptions. The results of the LCA show that carbon fiber composite consumes significant amounts of water, aluminum bicycle manufacturing uses significant amounts of energy, and chain manufacturing produces significant amounts of recyclable waste. The index results slightly favor the aluminum bicycle frame, but do not robustly indicate the specific impacts unique to each product. Qualitatively, the team found that consumers are willing to pay more for sustainable bikes and the media perceives bicycles and the industry favorably, but focuses on bicycle use over production. One recurrent theme of this project was the bicycle industry’s privacy concerns as evidenced by the team’s data collection. This limited access to data partially explains the lack of sustainability progress made in the industry thus far. The team recommends that both Specialized and the industry engage with their supply chains to encourage greater transparency and increase collaboration among bicycle brands and suppliers. The OIA has had success with this cooperative approach as it facilitates companies to learn from each other and ensures that work is not duplicated. Since little work has been done to measure and address the sustainability of the bicycle supply chain there is a substantial opportunity for improvements and much more to learn. The team is hopeful that this research will catalyze a conversation within the industry that will eventually lead to a more efficient supply chain. 1 Acknowledgements We are extremely grateful to Bryant Bainbridge at Specialized Bicycle Components for his support, expertise, and dedication to this project. He spent countless hours responding to our questions and his support went beyond that of a client to one of a professional mentor. We would also like to sincerely thank our faculty advisor, Dr. Deb Gallagher, for her guidance throughout the project. 2 List of Key Acronyms ANZTEC The Agreement between New Zealand and the separate customs territory of Taiwan, Penghu, Kinmen, and Matsu on Economic Cooperation ASI Advanced Sports International BB Bottom Bracket BLC Bicycle Leadership Conference BOD Biological Oxygen Demand BOM Bill of Materials BPSA Bicycle Product Suppliers Association BRaIN Bicycle Retailer and Industry News CIESIN Center for Earth Information Science Information Network CML Center of Environmental Science of Leiden University CNC Computer Numerical Control ECFA Economic Cooperation Framework Agreement EMPA The Swiss Materials Science & Technology Center ESI Environmental Sustainability Index GWP Global Warming Potential IEEE Institute for Electrical and Electronics Engineers ISO International Standards Organization LCA Life Cycle Assessment LCI Life Cycle Inventory MIT Massachusetts Institute of Technology MSDS Material Safety Data Sheet MSI Materials Sustainability Index MP Master’s Project MPG Miles Per Gallon MY Model Year NIST National Institute of Standards and Technology NSOE Nicholas School for the Environment OIA Outdoor Industry Association PFC Process Flow Chart PVC Polyvinyl chloride RSL Restricted Substances List SAC Sustainable Apparel Coalition SSRI Social Science Research Institute SWG Sustainability Working Group U.S. LCI United States Life Cycle Inventory Database VOC Volatile Organic Compounds WFSGI World Federation of the Sporting Goods Industry WTP Willingness to Pay YCELP Yale Center for Environmental Law and Policy 3 Table of Contents I. INTRODUCTION ............................................................................................................................................. 5 A. PROJECT OVERVIEW ................................................................................................................................................................... 5 B. THE CLIENT.................................................................................................................................................................................. 5 C. THE OBJECTIVE ........................................................................................................................................................................... 6 II. BACKGROUND ................................................................................................................................................ 7 A. THE CURRENT STATE OF SUSTAINABILITY IN THE BICYCLE INDUSTRY ............................................................................ 7 B. EXISTING LIFE CYCLE ASSESSMENTS OF BICYCLES .............................................................................................................10 C. THE USE OF INDICES TO DETERMINE OPPORTUNITIES FOR SUSTAINABILITY IMPROVEMENTS .................................11 D. THE POLITICAL NATURE OF BICYCLE MANUFACTURING .................................................................................................13 III. METHODS ..................................................................................................................................................... 13 A. LIFE CYCLE ASSESSMENT .........................................................................................................................................................13 B. OUTDOOR INDUSTRY ASSOCIATION EQUIPMENT INDEX ..................................................................................................17 C. MEDIA PERCEPTION ANALYSIS ...............................................................................................................................................17 D. CONSUMER SURVEY ..................................................................................................................................................................18 IV. RESULTS AND DISCUSSION ...................................................................................................................... 18 A. BARRIERS TO DATA COLLECTION ..........................................................................................................................................18 B. LIFE CYCLE ASSESSMENT RESULTS.........................................................................................................................................19 C. OIA EQUIPMENT INDEX ..........................................................................................................................................................24 D. MEDIA PERCEPTIONS OF THE BICYCLE INDUSTRY .............................................................................................................28 E. CONSUMER SURVEY ..................................................................................................................................................................33 F. THE BICYCLE INDUSTRY’S OPPORTUNITY FOR IMPROVEMENT .........................................................................................39 V. FINAL RECOMMENDATIONS ................................................................................................................... 39 A. 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