Mon, Oct 20, 2008 - Page 12 News List

FEATURE: Cycling boom keeps manufacturers busy

ONE MILLION SOLD As inflation soars and financial markets tumble, Taiwan’s bicycle manufacturers are thriving as the public becomes increasingly eager to economize

By Amber Wang  /  AFP , TAIPEI

Local women ride bicycles on a bike lane in Taipei on Oct. 8.

PHOTO: AFP

For the past six months Wayne Hsu has been cycling 45 minutes to his office every day, which he says gets him off to an energetic start and, more importantly, slashes his monthly gasoline bill.

Hsu, an airline sales representative in Taoyuan County, is among a growing number of people here opting for bikes over cars amid rising inflation and a slowing economy.

“Cycling is an inexpensive way to exercise and I’ve encouraged my colleagues and even my boss to follow my lead,” he said.

The new-found devotion to cycling is a great boon for bicycle manufacturers in Taiwan, which was once the world’s leading exporter but has watched business fall since the mid-1990s due to dumping charges and relocations of factories to China where production costs are much lower.

China now is the world’s major supplier of low-cost bicycles, while Taiwan retains its edge in high-end products such as racing-style, mountain and folding bikes with an average price tag of US$222, the Ministry of Economic Affairs said.

Exports reached a record high of US$$1.05 billion last year with 4.75 million bikes sold abroad, while this year looks set to break that record with the export of 2.76 million bikes totaling US$635 million in the first six months, government figures showed.

There is no official data on how many bicycles are sold locally but industry watchers estimate around 1 million were sold last year on the island of 23 million people.

“Business was booming in 2007 and this year looks to be the best,” said Jeffrey Sheu (�?�), spokesman for the world’s leading bicycle maker Giant Inc (捷安特). “Our monthly revenue hit a historical high in August and September looks like setting a new record.”

Giant’s August and last month group revenue rose 27 percent and 35 percent year-on-year to NT$3.91 billion (US$120.2 million) and NT$4.12 billion respectively while this year’s revenue is projected to increase by at least 25 percent to NT$40 billion.

“Our staff are constantly working overtime to meet the ever-growing demand,” Sheu said.

Orders have poured in for Giant products until the middle of next year, prompting the addition of a new assembly line at its central Taichung base to boost annual production to 1 million bikes from the current 600,000. It is expected to be completed by year-end.

As inflation soars and financial markets tumble, Taiwan’s bicycle manufacturers and other businesses catering to the thrifty are thriving as the public becomes increasingly eager to economize.

Pacific Cycles (太平洋自行車), a Taoyuan-based exporter, began selling its signature folding bikes at home in 2005, and since then they have become popular with city dwellers for their lightweight and convenient features.

“Our domestic sales are estimated to increase by 100 percent this year, compared with 10-30 percent in the past,” despite a 66 percent price hike to NT$50,000 per bike, marketing manager Max Yeh (葉斯偉) said.

The folding bike, fondly dubbed xiao che in Mandarin or “little foldable” by fans, weighs around 10kg.

The company, which produces 40,000 folding bikes annually in Taiwan, will soon unveil a second plant here to upgrade its product line, Yeh said.

Ed Lu, an avid fan of the folding bike in Taipei, said cycling to work helps him relax but he added that he’d prefer cleaner air for the ride.

“If more people start cycling instead of driving, we would be able to improve the air quality while reducing traffic jams,” he said.

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