Cervélo , Contracts and Consumerism
It’s not until you go to a big Fondo, Marca or Sportiv that you’re able to figure out how the likes of Cervélo can sponsor a pro team.
On the start line you’ll see hundreds of Looks, Colnagos, Treks and — Cervélos; all sold at full price.
But how much money can you make on a bike frame?
‘A well known Italian former six day star’ who’s extremely well connected at all levels of Italian cycle sport told me that one of the biggest names in Italian frame design imported their oversize aluminium frames by the container load from the Far East, sprayed up and with the carbon forks supplied.
‘At what price?’ I hear you ask.
A frame retailing at â‚¬1200 Euros cost them less than 100 Euros to import — in other words, the gross margins are huge and there’s cash to be made if you get it right.
Even so, the costs of running a big Pro Continental squad are astronomic — the Vacansoleil budget for 2010 is around five million Euros and they don’t ride anything like the programme that Cervélo: do or have the likes of Hushovd or Haussler on the books.
Apparently there were financial concerns within the team back in the spring — but not that we heard of.
It was after the Tour that the stories began to circulate; a giveaway was that the riders whose contracts expired at the end of 2010 were not approached by team management regarding renewal.
Sastre’s jumping ship from the Cervélo: team was a sure sign of all not being well.
The situation at the moment is that the best nine or ten riders from Cervélo: will get a place with Garmin, Jonathan Vaughters has endorsed that.
The likes of Hushovd, Haussler, Klier, Hunt and Hammond will have their contracts rolled on to Garmin.
However, there will be some riders whose contracts will be ‘bought out’ — they’ll get their wages but won’t get a ride.
If their agent handles this well for them then it could prove very lucrative, even if they have to take less than market value then they still have the Cervélo: moneys.
Just this morning, we received that a press release from Caisse d’Epargne that ’31 year-old Catalonian grimpeur Xavier Tondo will join the new squad Movistar after the 1st of January 2011’ — and is no doubt breathing huge sighs of relief.
We believe that talk of Hushovd and Haussler ‘looking around’ and ‘negotiating’ are a red herring; these riders were on big contracts, and besides, most team’s 2011 rosters will be filled and won’t be in a position to find the seven figures that a Hushovd needs at the top of his pay slip.
For the Cervélo: riders who are out of contract it’s late but not yet disastrous, although their agents can’t waste any time in getting on the phone; and some will not be riding a 2011 programme anything like their Cervélo: 2010 one.
For the stagiaires, it’s a dream tuned to nightmare, the contract with the high profile team turns to dust in your hand.
Over at the American orange and blue team it’s a similar tale, contracts will not be renewed or ‘bought out’ - and you should use your Transitions lenses to look out for some very high profile redundancies — remember where you heard it first.
Their new recruit’s contracts will be honoured however, we believe.
Whilst Cervélo: and Garmin can’t afford any scandals or too many cries of ‘foul!’ once again it serves to underline the fact that when it comes to cycling teams, cash and contracts — if you’re a rider it really does pay to sign the best agent and lawyer that you can afford.
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