Waterford Precision Cycles
The factory that produced the iconic Schwinn Paramount racing bikes has solidified its place near the top of the US bicycle manufacturing industry.
With roots that extend more than a century deep in U.S. bicycle manufacturing, Richard Schwinn and the talented builders at Waterford Precision Cycles have found new growth producing gorgeous, lightweight, high-tech American steel bicycles.
Rather than shut the doors and send production overseas, the same factory that produced the iconic Schwinn Paramount racing bikes has solidified its place near the top of the US bicycle manufacturing industry by contracting to produce frames for Shinola, a Detroit-based start-up selling luxury bikes for urban commuters. Adding to the excitement and the bottom line, Waterford is building a highly-sought after, limited run of 75th anniversary Paramounts.
Week-to-week, the diversely talented crew of 18 workers move from milling machines to welders to oxy-acetylene torches, joining steel tube with walls as thin as 0.4 mm with perfect tig welds, artfully cast lugs, and spools of precious silver.
The results are touring bikes, road bikes, cyclocross bikes and mountain bikes–for Rivendell, Boulder Bicycle, Georgena Terry Bicycles, Shinola, and Milwaukee Bicycle Co., in addition to filling orders for Waterford’s own brands, Waterford and Gunnar. The one commonality is an exacting attention to detail and precision measured by the thousandth of an inch.
The deal to fabricate 1,000 frames a year for Shinola adds to an already schizophrenic environment in the 8,000-square-foot factory, surrounded by trees and farm fields on the edge of Waterford, Wis.
“It’s wonderful when we can get 10 in a row,” says Richard Schwinn, Waterford president.
The Paramounts connect Waterford to a history that dates back to 1895, when Ignaz Schwinn, Richard’s great-grandfather, helped start Schwinn Bicycles in Chicago. The Schwinn company opened the Waterford factory in 1983 to build the Paramounts that dominated the Uracing bike market through the 1950s and late ‘70s.
When Schwinn stopped Paramount production in 1994, Richard Schwinn and long-time lead product engineer Marc Muller led the employees in the launch of Waterford.
“The Waterford factory has its own reputation that’s separate from Schwinn,” the bearded, 60-year-old legacy leader says. “The attachment is to the factory, not so much to the brand.
“We’ve set these roots down here and they’re not going to move.
“I like building bikes. I like building cool bikes, and I like building the world’s finest bicycles. Thoughtful, clever designs, compelling designs that people want to enjoy. We do very specialized kinds of bikes, technical masterpieces.”
The limited run of Paramounts and the foundation of the Waterford and Gunnar models connect the company to its lineage as an offspring of the once-dominant Schwinn line. At one time, Schwinn employed 2,000 people in its Chicago factory. That’s about the number of bikes that Waterford now produces in a year.
Still, the company ranks easily in the top 10 and possibly in the top five among bike builders in the United States. Roughly 100 U.S.-based builders, companies like Waterford, Serotta, Lynskey Performance Designs and Independent Fabrication, manufacture about 12,000 bikes a year domestically. That represents a miniscule fraction of the estimated 13 million adult bicycles sold in the country each year.
Most of the companies in the U.S.-based group measure their annual production in the hundreds. Waterford produces about 2,000 to 2,500 frames each year, and Schwinn cautiously reveals a total revenue figure of $1 million to $2 million.
“Two thousand is the high end of the boutique artists that are doing the hand-builts,” says Jay Townley, a veteran industry analyst and principal in Gluskin Townley Group LLC.
“They’ve hung in there. They’ve done different levels of private label work and they are part and parcel of a growing movement, a trend since 1993: the growth of the high-end, hand-built market.” Townley lists a number of new start-ups in Chicago and Detroit among the builders helping to return production to the U.S. “The high-end, hand-built business has been a part of the American story and you’re getting some expansion of that,” he says.
While the limited Paramount production represents a reflection of the Schwinn and Waterford history, the launch of Shinola represents a significant opportunity for its future. Financed by Tom Kartsosis, the founder of Fossil watches, the company opened in Detroit two years ago, making high-end watches and bicycles and focusing on the American-made appeal. It opened a trendy shop in Detroit and a fancy boutique in New York City to sell its watches and the luxury bikes, the lugged, silver brazed Runwell and the tig welded Bixby, at $2,950 and $1,950 respectively.
“Shinola has been a way to broaden our base and ensure the factory is full. It changes the motivational structure of the factory,” Richard mused. “Shinola allows us to create a fashion bike that’s revolutionary.”
Filling the Shinola contract will strain the capacity of the welders, brazers and shippers working in the cluttered Waterford plant. The company’s reputation earned it the business, according to Sky Yaeger, an industry veteran and the design leader for Shinola.
“Shinola only wants to bring to market high-quality products so we feel really lucky to be able to make the frames here,” Yaeger says. To date, “It has worked spectacularly. Waterford has delivered the highest-quality frames in record time,” she says.
Producing frames for other companies – the venerable Rivendell and the newcomer Shinola – will be a key to the success of Waterford and similar builders, according to Townley. The other businesses absorb the marketing costs and much of the other overhead, while Waterford focuses on what it does best: weld steel into bicycles.
In conversation, Schwinn shifts smoothly from violins to bike building to U.S.-China trade relations. Thoughtful and well-sourced, he analyzes the economy as carefully as a new bike buyer inspects a brazed lug.
The challenge for Richard Schwinn and Marc Mulder will be to balance the work and keep Waterford and Gunnar fresh and appealing. Delivery times on Gunnar frames have grown to three months, compared to four to five weeks, due to the private label workload.
“Yeah, I worry about that,” Schwinn says. “I have to put time into Gunnar and Waterford because they sustain us. It’s all part of the tightrope of being in the bike business.”
The Shinola contract has added urgency to efforts to improve efficiency in the factory. Schwinn has encouraged the individual workers to become more flexible, and to invest the same energy in shipping and inspecting as they do in welding and brazing. “It’s cool to see how people are working together,” he says. “My ideal world is self-directed work groups.”
The bicycle industry is constantly changing, as evidenced by the shift away from racing bikes that eventually caught up to Schwinn and Paramount in the 1980s, and the waves of Chinese built frames that now dominate the market. Schwinn says that today Waterford would be unsustainable as a business building only Waterfords and Gunnars.
“We would be too inbred in our thinking,” he says. “I learn from every one of these experiences. They have made us more innovative. “I think it’s going to be a really cool time in the next five years.”
Whether you throw a leg over a Ferrari-fast, fully custom Waterford racer built just for you or a luxuriously comfortable Shinola, we think you’ll agree with Richard: American steel is still cool, and it ain’t going away.
Find out more at www.waterfordbikes.com