Peloton Expands Taiwan Manufacturing Agreement, Steps Away From Own Production

Peloton is ditching its self-owned manufacturing operations as part of a plan to expand its partnership with Taiwanese manufacturer Rexon Industrial and “simplify its supply chain” by focusing on its technology and content, according to a company press release Tuesday (July 12).

Rexon will become the primary manufacturer of the hardware for Peloton’s Bike and Tread product lines, while Peloton will suspend operations at its Tonic Fitness Technology facility through the end of the year.

“We are thrilled to be expanding our partnership with Rexon, a leading Taiwanese manufacturer with over 50 years of experience,” said Peloton Chief Supply Chain Officer Andy Rendich in the release. “… We plan to maintain a significant corporate and manufacturing presence in Taiwan with over 100 Peloton Taiwan team members who continue to play a key role in our engineering and manufacturing strategy.”

Peloton CEO Barry McCarthy said in the release the transition is “another significant step in simplifying our supply chain and variablizing our cost structure — a key priority for us. We believe that this, along with other initiatives, will enable us to continue reducing the cash burden on the business and increase our flexibility.”

Peloton has struggled to maintain the traction it achieved during the pandemic in the past several months, including a string of injuries using its equipment and episodes of popular shows depicting injuries and deaths by Peloton users. It has about 7 million members today, per the release.

In June, Peloton appointed Liz Coddington, a 20-year veteran of financial planning, as its new chief financial officer, replacing Jill Woodworth, who is stepping down after serving for the past four years.

Read more: Peloton Hires Ex-AWS Finance VP Liz Coddington as Its CFO

Coddington was recently vice president of finance for Amazon Web Services and has worked with other companies in B2B and consumer-facing industries, including Walmart and Netflix.

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