High Value Rust On Wheels

One

Rob Ben­nett for The Wall Street Jour­nal Sept 3rd, 2011

The Recy­cle A Bicy­cle store on Avenue C in Manhattan.

An old, bro­ken bicy­cle is a sorry, sorry thing. Tom Waits knows—he wrote the sad­dest song in the world about those rusty old skele­tons: “Some­body must have an orphan­age for/All these things that nobody wants any more.” Well, that orphan­age is New York, where used bikes are the cor­roded dar­lings of the vin­tage scene. In just a few years, local retail­ers say, prices have dou­bled. There just aren’t enough used bikes to go around.

It’s likely due to the city’s new­found pas­sion for cycling—our DOT says bike com­mut­ing is up 62% since 2008—and a street­wise mind­set that puts a pre­mium on dull, bat­tered frames. A shiny new bike locked to an Avenue A street pole, after all, has a half life of roughly 60 seconds.

In most parts of the coun­try, an old bike has all the cachet of a cathode-tube TV. On his blog Blind Taste, behav­ioral eco­nom­ics researcher Robin Gold­stein wrote up the results of an infor­mal study com­par­ing used car and used bike prices in major U.S. cities. There’s an inverse cor­re­la­tion: In towns where every­one dri­ves, such as Phoenix, used-car prices were sky high, while the median used bicy­cle sold for just $120. Here in New York, used car prices ran 16% lower than in Phoenix, but the median used bike cost $200. In cycling-crazed Port­land, Ore., it’s even worse.

All of which sug­gests a fan­tas­tic busi­ness oppor­tu­nity: bicy­cle arbi­trage. Why not buy up all the used bikes in, say, Albany, and resell them in New York? Of course, like every good idea I’ve ever had, dozens have thought of it before me.

Among them is a man known as Shane DaBike­Jack, a tow­er­ing for­mer pro ath­lete who sup­plies half a dozen bicy­cle retail­ers around the city, not to men­tion his own stand at Brook­lyn Flea. “I keep the cher­ries for myself,” says Mr. DaBike­Jack, who declines to use his real last name for rea­sons I can’t quite com­pre­hend. His buy­ing ter­ri­tory: the New Eng­land ‘burbs, includ­ing Con­necti­cut and Mass­a­chu­setts. On a typ­i­cal day, he’ll hit five scrap yards, the tag sales, a half-dozen Good­wills and a Sal­va­tion Army. Some­times, dri­ving along, he’ll spot an unsus­pect­ing cyclist tot­ter­ing by on a vin­tage Schwinn and offer to buy it for $20 plus the shiny Chinese-built “Wal-Mart spe­cial” off the back of his truck.

A ven­dor known as ‘Shane DaBike­Jack,’ unloads his wares at a flea market.

It’s not easy, says Mr. DaBike­Jack. The days are long, he says, and 75% of the time he strikes out. On the other hand, he has no boss and can take all the breaks as he wants: “I smoke weed and girl-watch.” And the prof­its can be fan­tas­tic. Most used bikes need a lot of work, and Mr. DaBike­Jack spe­cial­izes in retro­fitting vin­tage frames with new parts. “I Puff Daddy it out. I remix it,” he says. But occa­sion­ally, he scores a real find: a $5 bike in per­fect con­di­tion that resells for $500.

At Mr. DaBikeJack’s stand, prices start at $125 for a delivery-boy special—a scrappy moun­tain bike from the late ‘80s. And that’s about as cheap as bikes come in New York. Even on Craigslist, the rusti­est, sor­ri­est bicy­cles pulled from the Gowanus start at $150. And most list­ings come from a hand­ful of deal­ers eager to ren­dezvous at some vague meet­ing spot near the Staten Island Ferry, for exam­ple, or the Knicker­bocker stop on the M line.

Among the more rep­utable Craigslist reg­u­lars is Peter Whit­ley, who sells hun­dreds of used bikes from his Brook­lyn base­ment. He had a busy sum­mer. Sales dou­bled after a cus­tomer advised him to rename his busi­ness Brook­lyn Vin­tage Bicy­cles. To keep up with demand, he relies on a hand­ful of ven­dors who shop out of town and resell used bikes by the truck­load. On a typ­i­cal deal, he’ll pay $50 whole­sale, add $50 in new parts, and sell the ride for $200.

Mr. Whit­ley says he trusts his long-term ven­dors. But the prob­lem with buy­ing a used bike, of course, is fig­ur­ing out where it came from. And accord­ing to Trans­porta­tion Alter­na­tives, there are dire con­se­quences for buy­ing a stolen ride. It not only wrecks your karma, the group warns on its web­site, “but also increases the chance that your own bike will be stolen.”

The advo­cacy group rec­om­mends Recycle-A-Bicycle, a non­profit with shops in Dumbo and the East Vil­lage that restores donated bikes and uses the pro­ceeds to fund job train­ing for city teenagers (a brave new gen­er­a­tion of bicy­cle mechan­ics). But there are no bar­gains there, either: Retail Direc­tor Susan Lin­dell says she charges mar­ket rates. The recent selec­tion ranged from $225 for a Mon­goose BMX (“so clas­sic, so cool”) to $1,200 for a Mer­lin Road bike.

Many folks buy­ing a vin­tage bike think they’re get­ting more than just a mode of trans­porta­tion. It’s a sig­ni­fier. “A fab­u­lous car will get a man in bed with a girl,” says Mr. DaBike­Jack. “The bike will do the same thing in New York.”

I’m not in that scene, I really can’t com­ment,” says Joe Nocella. The full-time archi­tect recently opened a Park Slope bike shop, 718 Cyclery, and is already plan­ning a new loca­tion in Gowanus five times the size. He spe­cial­izes in col­lab­o­ra­tive builds, work­ing with clients to cre­ate cus­tom rides based on used frames bought off eBay. The typ­i­cal tab: $900 to $1,200.

To some, he sur­mises, a vin­tage bike sug­gests you appre­ci­ate the finer things: “It’s an easy ticket to dis­play­ing a lifestyle that’s bet­ter than the lifestyle you have.” As if on cue, a man in his 30s comes burst­ing through the door to check on his bike-in-progress. He is lit­er­ally danc­ing with excite­ment. To refresh his mem­ory, Mr. Nocella asks the cus­tomer to recall a few details. The response is imme­di­ate: “I just told you to make it look awesome!”

—Ms. Kadet, who writes the “Tough Cus­tomer” col­umn for Smart­Money mag­a­zine, can be reached at anne.kadet@dowjones.com

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