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I recently assembled a new bike I bought but this piece was not mentioned in the instruction manual and I was not able to figure out by searching myself either.

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I tried putting it under the seat but did not seem to work. I also have 2 nuts and screws that I assume will go into those holes seen..

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Looks like a derailleur guard

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It mounts to the rear drop out on the derailleur side.
It protects the derailleur from some impact damage.
EDIT: 06/19/2021 The comments seem to be running strongly against the need for this device.
Many experienced riders see this device as useless, and for their use case this is true.
One possible use case: If I had a child and this was his/her first derailleur bicycle I would see this device as useful to prevent the occasional bike falling over or mild crash from affecting the derailleur.
Yes, the derailleur is inexpensive and the device is heavy - but the kid is just learning to ride and it does offer a little protection.

As a side note - when assembling a bike from the box

  • Adjust the front hub before installing the wheel
  • Pull the rear wheel and check / adjust the rear hub
  • Slip the chain off the front chain ring (you can shift the chain into the smallest chainring and then slip it off toward the seat tube so that it sits on the bottom bracket) and check crank bearing adjustment
  • Check headset bearing adjustment.

All bearings should spin smoothly with no play.
Many new bikes have bearings that are silly tight. A quick check and correct adjustment will make your bike ride better and last longer.

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    Yes, it’s a good idea to thoroughly check pre-assembled bikes. Not just bearing play, also that all screws are sufficiently tight, handlebar aligned, brakes aligned, brake cables properly installed and seated and so on. – Michael Jun 18 at 15:38
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    Some bearings (e.g. wheel hub, headset) have been known to be shipped with insufficient grease packing on loose ball bearings, so I like to disassemble things down to the ball bearing level on those just to make sure. – Armand Jun 18 at 22:06
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    I've never seen a derailleur guard on a bike whose derailleur was worth more than ten dollars, ironically. – Kaz Jun 19 at 3:20
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    @Kaz On better bikes the RD is somewhat protected by the replaceable derailleur hanger. The guard is connected directly to the frame so even if it soft, it might transfer some bad forces. – Vladimir F Jun 19 at 14:26
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    One other thing to check: just last week I fixed a kid's bike that had one of these fitted by removing it, because (for reasons known only to whichever company assembled it) the protector did not extend out far enough from the frame, so the derailleur hit it before the stop screw when properly set up and shifted into the highest gear setting, which put said highest gear setting about half way between the highest and second-highest physical gears. – user3482749 Jun 19 at 22:34

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