Peloton confirms plans to offer a cheaper version of its $2,000 bike as it pushes to dominate the at-home fitness market

• Peloton's CEO confirmed that the company is considering offering a cheaper version of its $2,000 high-tech fitness bike.
• CEO John Foley said that in doing so it hoped to reach more customers. "That's a big focus for us in the coming years," he said.
• Peloton is one of the few consumer companies to have seen sales boom during the pandemic as stay-at-home restrictions keep consumers out of gyms and working out at home.

Peloton CEO John Foley confirmed in a recent interview with Time that the company is looking to offer a cheaper version of its $2,000 bike in a bid to reach more customers.

"We want to make our products even more affordable than they are today," Foley said, adding that its bike currently costs just over $2,000 and can be paid for in interest-free installments of $58 per month for 39 months. If two people are using the bike, for example, this works out as $29 each.

"If we can get those monthly payments down, we can really open it up. And we want everyone in every socioeconomic class to be able to afford Peloton. That's a big focus for us in the coming years," he said.

Foley wouldn't comment on what price of the new bike might be. He said the aim would be to get these monthly payments down to $20 per person, assuming two people are sharing the bike. Based on its current 39-month installment plan this would work out at $1,560.

"I think if you can get to 20 bucks a month per person, you're starting to get below Planet Fitness-style, low-end gym chain affordability, and we think that that's a pretty big opportunity for Peloton," he said.

Peloton has been one of the few companies to have experienced a sales boom during the coronavirus pandemic as lockdown restrictions have kept gyms closed and forced consumers to work out at home.

In its third-quarter results Peloton revealed that sales surged by a whopping 66% during the quarter as more people invested in its bike, treadmill, or workout app.

Moreover, its average net monthly net churn, a metric used to measure customer retention, hit its lowest rate in four years.

"Our global Connected Fitness Subscriber base saw significant growth in the third quarter. Our growth was aided by increased demand for our products driven by the extraordinary circumstances facing our global community with the COVID-19 crisis," the company wrote in a letter to shareholders earlier this month.

"Connected Fitness Product revenue exceeded our expectations across all geographies driven by strong demand for our Bike and performance of Tread," it said.