Taiwan’s Bikes & E-Bikes Getting Squeezed Out Of The Market, But A Comeback Seems Likely
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While the cultures of Taiwan and China continue to slowly drift their separate ways (after a civil war three-quarters of a century ago), there’s one thing that’s still firmly entrenched on both sides of the Strait: bicycles. It’s an indisputable fact that bikes are fantastic for densely-populated areas. They’re small, they take up little space, and perhaps most importantly, they’re cheap.
Bike travel has usually been a priority in Asia, with actual bike infrastructure in place except in the most rural areas. Bike paths are very common, but even on the roads, people in cars are used to sharing space with bikes and don’t get raged out the way drivers in the US all-too-often do.
Instead of killing the bicycle, modern technology has further entrenched the humble vehicle’s presence in most of Asia. For one, e-bikes have largely remained as unregulated as regular bikes, giving the vehicles a serious boost in usefulness while keeping costs and headaches low. Add in GPS, cellular technology, and increasingly cheap computers, and both regular and e-bikes are now widely available for easy rental. Often located at transit stations, these bikes serve extremely important last-mile duty.
But, just because both sides of the Strait have embraced and continue to support bikes, doesn’t mean rivalries can’t find their way into the picture. This time, competition is happening in the international sales space, and according to Show Daily (a publication that covers bike shows and the bike industry), Taiwan’s bike industry isn’t winning the fight.
The problem? Show Daily says it’s a “pork cycle.” The pandemic fueled much greater interest in bikes and e-bikes globally, especially as an alternative to transit. Nobody wanted to sit in a box with other people who might have a deadly germ, so the open air of bicycles fueled a LOT of growth.
But, the growth wasn’t to last. E-bikes got a lot of bad press (especially fires in New York), for one. The end of the pandemic (at least officially) cut out a lot of the interest. Rising prices also had a nasty effect on sales. Now, there’s a glut of bike production and inventory is piling up in Taiwan’s warehouses instead of getting shipped overseas.
Taiwan’s biggest bike companies, Giant and Merida, were hit as hard as the smaller players. Giant’s sales dropped by almost a third in the last quarter of 2023, while new models were also delayed to avoid oversaturating the retail market.
There’s one bit of good news, though. Regular bikes have been hit pretty hard, while e-bikes have been spared some of the economic carnage. This proves out the idea that buyers prefer e-bikes over pedal-only bikes, and shows us that e-bikes have a promising future outside of the regular bike markets.
While Taiwan has been hit hard, China’s bike exports doubled in 2023. I’d personally attribute this to extremely heavy marketing. Journalists and influencers (including us) have been given a TON of Chinese review bikes over the last few years, amounting to cheap advertising for the companies selling them in the U.S. and Europe. It has gotten to the point where many influencers and publications (again, us included) had to start charging for the reviews to keep them from becoming a meaningless flood of “me too” bikes for audiences.
Show Daily doesn’t think this will last, and they may be right. the lifting of Xi’s zero-COVID policies led to a production and sales surge while consumer interest globally is still down regardless. Economic headwinds in China are also a big problem that’s likely to hit the industry.
Regardless of performance in the near-term, the overall e-bike picture is likely to remain strong. If companies on both sides of the Strait can get their inventories to even out and get production more in sync with demand, there’s still a lot of room for growth in the coming years.
Geopolitics Could Make For a Strong Comeback
Anyone following the news in Asia knows that China isn’t making its neighbors very happy. Fake islands have been built in the South China Sea atop reefs and atolls for a big land grab that has everyone from Vietnam to the Philippines up in arms. Prohibited from carrying weapons along the border, Chinese and Indian troops have been in medieval battles. Continued scrapes with Japan and South Korea have led to some serious military buildups there, too. Even Japan has been considering going nuclear.
These aggressive moves combined with Russia’s war in Ukraine (Russia is aligned with Beijing) has soured many countries in Europe, the Americas, and Oceania on China.
With global political strife, it seems likely that trade barriers will continue to go up. The United States is already excluding EVs with Chinese batteries from being eligible for tax credits, for example. If the political situation continues to deteriorate or even devolve into open warfare, you can bet that western democratic powers will work to cut off or reduce Chinese imports and otherwise avoid feeing the enemy.
This would leave Taiwan’s bicycle and e-bike manufacturers in a position to write their own ticket. Without the many different kinds of Chinese bikes dominating the bike market, a reduction or end of imports would lead to a mix of domestic (U.S. and Europe) manufacturing and Taiwanese imports going up. This could be true even in a war situation, as Giant already has factories in Europe, and the Chinese factories Giant still has are not exporting to the United States.
Getting The U.S. To Buy More
Another big question is whether demand in the United States could be increased. The number of bike-friendly places are growing, but I think most readers would agree that this is a situation that needs to improve a lot more. With EVs finding unexpected (at least by manufacturers) challenges of affordability and demand, e-bikes can help pick up the emissions slack.
If cities and states can be smart about better accommodating bikes and e-bikes, the market could get even better for bike manufacturers in Taiwan. But, that’s no easy task given the dismal state of bike infrastructure in much of the country.
Featured image by Giant.
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