"The incident is being investigated by police so if anyone has seen or heard anything suspicious we urge them to report it," he said.
"While insurance will help towards a replacement, it will not cover the full cost and the damage a mindless act of vandalism like this does to the reputation and vibrancy of our community comes at an even greater cost."
Taupo Mayor David Trewavas has called for the community to band together to make sure the "mindless thugs" get caught.
"This is not just an act of vandalism, it is a crime against the community," he said.
"It is unbelievable that someone would do this, particularly on the eve of our district being showcased on the world stage with international media coverage of Ironman New Zealand's flagship event."
Taupo District Council contributed $3500 toward the $55,000 cost, with the rest raised by the community.
Since its installation the 3m tall bike, designed and built by Waitahanui artist Marcel Zwezerijnen, has been a focal point for the community with many locals and visitors taking the opportunity to be photographed with the sculpture.
The damaged bike was removed today.