TAICHUNG, Taiwan — Because gyms are closed and we could all use a little more exercise; because we are avoiding buses and trains; because we are in need of outdoor group activities; or perhaps just because the pandemic has made us crave simple pleasures like the wind against our faces, bicycle sales are soaring around the world.
The result has been an international bike shortage. And the world’s largest bike maker, Giant, expects its supplies to remain tight for some time to come.
After President Trump started his trade war with China in 2018, Giant moved some of its manufacturing for the American market from China to the company’s home base in Taiwan to avoid the added tariffs. The next year, the European Union imposed antidumping duties on electric bikes from China, so Giant began making those in Taiwan, too.
But when the pandemic caused demand for bikes to jump, Giant needed to reverse course. With its Taiwan facility already under strain, the company had little choice but to crank up production in China, even if it meant bearing the extra cost of tariffs.
“There’s nowhere else in the world that can go like China from zero to 100 in an instant, like a sports car. Shyeew!” Giant’s chairwoman, Bonnie Tu, said in an interview.
The Trump administration this year temporarily lifted tariffs on a variety of Chinese-made goods that are deemed strategically unimportant. Bicycles made the list, which made it easier for Giant to go back to producing some of its bikes for the U.S. market in China.
But the tariff pause for certain types of bikes expired this month, meaning Giant may need to adjust its supply arrangements yet again. The trade pact that the United States and China signed in January has held up even as the two powers clash on other issues. That has hardly made planning less complicated for companies and industries that are stuck in the middle.
“It’s not that I want to leave China. Not at all,” Ms. Tu said. “It’s that there’s nothing that can be done. There are too many trade barriers.”
Giant rose to prominence decades ago making bikes for the iconic American brand Schwinn before gradually becoming a powerhouse in its own right. As China began displacing Taiwan as a manufacturing hub, Giant opened factories there while keeping a plant near Taichung, the Taiwanese city where bubble tea is said to have been invented. Today, the company runs five factories in China, accounting for 70 percent of its output.
Giant shuttered its Chinese plants after coronavirus infections started spreading quickly in the country, and it kept them closed for a month and a half. Then, when Europe and the United States began locking down, importers canceled orders.
American sales started picking up again in March, Ms. Tu said, and today all of Giant’s factories are running nearly at full steam to make up for the lost production. Despite the rush of first-time bike buyers, she does not plan to “blindly” invest in new manufacturing capacity. She is not yet convinced the world’s newfound love for two-wheelers will outlast the pandemic.
“Every boom ends someday,” she said. “It’s just a question of whether it ends quickly or slowly.”
Ms. Tu’s careful ways in business are belied by her carefree manner in person. At 70, she exudes energy and high spirits. She cycles three times a week and has completed four loops around the island of Taiwan. She says proudly that she completed her first triathlon in her 60s.
“But I did it as a relay,” she adds quickly. “Just to be perfectly honest.”
Like any good distance cyclist, Ms. Tu knows how to pace herself. She is not worried that Chinese rivals might try to capitalize on lockdown-driven demand by pushing out cheap bikes en masse. The pandemic has already revived the fortunes — for now, at least — of one of China’s biggest bicycle factory towns, which had to retrench last year after the country’s bike-sharing bubble popped.
Ms. Tu said she found it hard to understand why Chinese business owners seemed to believe their customers cared only about price, not quality. “They are willing to spend tens of thousands of euros to drink a bottle of red wine,” she said. “Why do they think other people are willing to ride a $60 bicycle?”
Her concern, when it comes to China, is maintaining Giant’s work force there. Young people’s interest in factory jobs is declining. Hiring in China still seems tough at the moment, despite widespread layoffs.
“Before, if we wanted to hire one worker in China, there would be three people lining up,” Ms. Tu said. “Now, if you are looking for three people, it’s nice if you have even one person lined up.”
Giant, she said, is trying to figure out how best to use its China resources amid the geopolitical turbulence. What if Mr. Trump canceled his trade war tomorrow?
“Of course we would return to China,” she said, laughing. “That’s for sure.”
Business ties are strong between Taiwan and China, even if much else about their relationship is tense. China claims the self-governing democracy as part of its territory, and it has not ruled out using force to bring the island to heel.
Giant recently opened a factory in Hungary and aims to produce 300,000 bikes there next year. Many manufacturers have set up in Vietnam, but Southeast Asia doesn’t make sense for Giant, Ms. Tu said. Not enough of a local market for its bikes.
Might Giant manufacture in the United States someday?
“I think you shouldn’t say there isn’t this possibility,” Ms. Tu said, a little cryptically. Ever since the trade war began, she said, “I’ve thought that everything is possible.”
Still, it would be “very, very tough,” she said. What would help, she said, are robots.
“If we can do more automation, then there will be a greater opportunity,” she said. “Under today’s automation, I think there’s absolutely no opportunity.”
The only way to make bikes in America, in other words, is by not getting many Americans involved.
The deindustrialization of the West is one of many grim realities of 2020 that the bicycle industry is not going to change on its own. But the coronavirus bike boom points to other kinds of transformations that might emerge from this dark moment. Cities around the world are overhauling their streets to restrict automobiles and better accommodate pedestrians and cyclists. European governments are accelerating investments in biking infrastructure and bicycle promotion programs.
On a gorgeous summer afternoon, Ms. Tu cheerfully agrees to go for a ride near Giant’s headquarters in Taichung. She emerges from her office in wraparound mirror shades and a teal cycling jersey.
Even the most humdrum corners of Taiwan abound with astonishing natural beauty: indigo mountains, the glittering sea, greenery in a multitude of eye-popping shades. Taiwan has had very few coronavirus deaths and no mass lockdown.
Ms. Tu has much to be exuberant about as she powers up a hill on a bright-blue electric bike.
“Yes!” she shouts. “OK!”
"now" - Google News
August 17, 2020 at 04:00PM
https://ift.tt/3ayGCnu
Sorry, the World’s Biggest Bike Maker Can’t Help You Buy a Bike Right Now - The New York Times
"now" - Google News
https://ift.tt/35sfxPY
Bagikan Berita Ini
0 Response to "Sorry, the World’s Biggest Bike Maker Can’t Help You Buy a Bike Right Now - The New York Times"
Post a Comment