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Tuesday, January 31, 2012

Inside Knowledge: Taiwanese Bike Companies and The Costs of Chinese Manufacturing

Bicycling IQ has a very good article up on the exodus of smaller Taiwanese bicycle component manufacturers from China as structural increases make doing business in China less of a profitable endeavor. The problem for these companies is in finding competing economies of scale.

Courtesy of the China-Taiwan cross-strait economic cooperation framework agreement (ECFA), tariffs on bicycle imports between the two countries have dropped from their previous levels of 12%, to 0% this year. The ECFA has been well-received by Taiwan-based makers of higher-end bicycles; but mostly those who had previously added mainland infrastructure to their manufacturing arsenal, years before they caught a whiff of earnest free trade discussions. They can now toggle their operations almost effortlessly between the two countries, depending on demand and client need. Other, smaller, OEM’s may struggle to compete against such flexibility in a declining global market.

The whole article is really intelligently thought out and is worth a read.


In other news, Giant has apparently won a bid to supply the city of Taipei with a system of bicycle rentals. Details of the winning bid or competing proposals are scant, but it appears Giant has its work cut out for it. This must be good news for Giant's President and Founder, King Liu, who also serves as a special advisor to the Taiwan's president Mr. Ma Ying-jiu.

The You Bike program aims to:
  • Promote Taipei City's image as an eco-friendly international metropolis
  • Create new tourism opportunities in Taipei
  • Improve residential quality of life and citizen satisfaction
  • Reduce the use of cars and motorcycles to improve air quality and transportation
  • Encourage people to take up cycling
  • Transform Taipei into Taiwan's capital of cycling
It is this writer's belief that the Taipei city government will have to do much more in providing city-wide bicycle infrastructure to make this project more than leisure rentals along bike paths. The city will need to provide a safe cycling environment, enforce traffic laws, provide safe storage facilities, retrofit busses and MRT cars for bicycle transit, increase the number of bicycle ONLY lanes and many other projects before this projects can begin to benefit Taipei residents. Lots of work to do before putting bikes on the roads.


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