Peloton has recently reiterated that they currently have no plans to offer the Tread or Row as rental options.
Chief Financial Officer Liz Coddington attended the Morgan Stanley Technology, Media & Telecom Conference on March 7, 2024, and shared insights about the company’s fitness as a service (FAAS) plans.
As a refresher, we previously reported that based on Q1 2024 earnings call in November 2023, while Peloton was considering expanding their rental program – which currently only includes the Bike and Bike+ – to the Row, they are unlikely to offer the Tread or Tread+ as a rental option due to the complexity of the installation.
However, Coddington’s statements at the Morgan Stanley conference indicate that Peloton has no plans to offer rental options for the Row either at this time. She stated:
“I’ll never say never, because you never know. We may change our minds. But at this point, we have no plans to offer rental programs for our Tread or our rower.”
Coddington went on to explain that this is due in part to the fact that the Row is a newer product for Peloton, launching in September of 2022, and currently only available in the United States.
Moreover, Peloton’s rental program itself is still relatively new and does not have high awareness. According to Coddington:
“First of all, if you think about our Bike, we have been in the market with our Bike for over 10 years. There’s pretty high unaided awareness of our Bike offering. But there’s actually still relatively low unaided awareness of our Bike rental offering.
So we see that, again, as a way to reach incremental subscribers who would not have joined Peloton otherwise. And that’s the key reason for offering Bike rental. For Tread, we — it’s a newer product for us as well as rower, which is even newer. For Tread, we are seeing substantial year-over-year growth in our sales. And then for rower, so far, it’s proven to be more of a niche product for us.”
In addition, the Row and Tread are both sold at higher price points than the Bike and Bike+. While the Bike retails for $1,445 and the Bike+ retails for $2,495; the Tread and Row retail for $2,995. The Tread+ sits at an even higher price point at $5,995.
Coddington explains the difficulty presented by these price points:
“The other thing worth pointing out about both of those products is they are at a slightly higher price point than our Bike offering. And if you combine that with the fact that it is more expensive to deliver and set up those products, we would have to charge a higher rental fee for a Tread rental offering or a rower rental offering in order for the unit economics to make sense for us.”
In other words, the rental price may be so steep for the Row and Tread, it would not make sense economically for Peloton to offer this option. As always, this is subject to change – but for now, it appears that Peloton has no plans to expand their rental program to include the Tread or Row.
Peloton’s bike rental program first launched in 2022 and underwent a number of changes relatively quickly – first by expanding to additional states, then by expanding to the entire continental U.S. Earlier this year bike rentals became available in Canada, and later became available in Germany.
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