the bike industry

In article
<[email hidden]>,

loki said:

http://www.theglobeandmail.com/servlet/ArticleNews/TPStory/LAC/20040907/RTRADE07//?query=china+bicycle

Globe & Mail, 7/9/4, [Asian menace? or the glories of the WTO?]

'OTTAWA - Canadian bicycle makers fear a big jump in rival Chinese imports
after Ottawa cleared the way last week for the communist country to ship
cheaper products here without incurring anti-dumping duties.'
[...]
'That's because Ottawa has decided to stop treating China as a so-called
non-market economy riddled with government intervention and subsidies.
(China recently joined the World Trade Organization and has been lobbying
other countries to win market economy status.)

'But Ottawa's new approach means it's using data directly from Chinese
manufacturers, who operate extremely leanly, to verify these Asian producers
are not dumping bikes below cost of production in Canada.'
[...]
'Michael Flavell, a lawyer for some Canadian bike makers, said Ottawa's
move could force companies to shutter bike assembly operations here and
instead switch to importing them in order to stay competitive.

The two bike "assemblers" mentioned in the story are Procycle (Rocky
Mountain, Oryx, CCM, and other brands high and low) and Raleigh Canada.

Assembler generally means bolting frames made in Taiwan to components
made in Malaysia in the comfort of a Canadian plant. This is not a bad
thing! But I would be surprised if low-end bikes from these companies
even get such treatment. I'm pretty sure almost every CCM on the market
would be fully built up in Taiwan.

Chinese-assembled bikes don't really affect the LBS market (except as
another data point for customers who come into the shop, see
full-suspension bikes selling for $1800, and figure they should just buy
the $200 one at Canadian Tire), because I don't know of any Chinese-made
(as opposed to Taiwanese) bikes making it to LBS floors.

The future probably does mean that more and higher-end bike frames will
be built in China. Right now Taiwan is in the same boat Japan was 20
years ago: a maker of high-quality frames with cost-control issues
compared to a cheaper competitor across the water. Except Japan was
looking at Taiwan, and Taiwan is looking at China.

So for now, Wal-Mart bikes will get even cheaper, and eventually Norco
and Procycle and Raleigh will probably start moving more production to
China, and Taiwan will have some interesting times as they get pushed
into higher-end bike making, maybe even putting pressure on some
domestic makers in Europe and North America (Rocky Mountain, for
example, still touts the fact that its bike frames are made in Canada).

--
Ryan Cousineau, [email hidden] http://www.wiredcola.com
Verus de parvis; verus de magnis.