Originally Posted by
dwolsten
There probably isn't much. However, we should be happy that there's rich people willing to spend $15k on a bike, because it's effectively subsidizing the bikes at the price points the rest of us buy at. Those $15k bikes are mostly pure profit for the manufacturer (not completely, they spend some on marketing and stuff which isn't spread over as many units as the cheaper models) and help pay for stuff like R&D costs for the bikes the rest of us buy. The new technologies found on those $15k bikes ends up being common on the cheaper bikes a few years later. The new technologies in Shimano's Dura-Ace line, for instance, end up being put into their Ultegra and lower lines in subsequent product generations.
I obviously can't speak for all manufacturer's but the example given in the past was not that the high end bikes were subsidising other bikes because so much R&D money went into them and they often sold in small numbers and had very expensive low volume production. It was normally the mid-range bikes that generated the huge money. These were the most expensive bikes sold imported from the far east which had a huge markup. If you had a range of bikes going from $500 to $10,000 probably the £1,000-$5,000 price point would offer the the greatest financial reward because it offers both high margin and reasonably high turnover. It really depends on the company though but to maintain a great brand with consumers you have to provide cutting edge product but most people will go for cheaper options than that. If you are putting in 95% of R&D into product that makes up only 0.2% of turnover by value I don't think you can say the high end is subsidising the lower end. I remember reading that Raleigh many years ago was selling 1000s of entry level bikes for every 1 of their high end special projects bikes. I realise that is a very dated example but it is the only one I can think of but I expect it is similar ratio today with many companies.