FEATURE: Bicycle manufacturer now makes point of riding them

NY Times News Service, GREATER TAICHUNG

Mon, Sep 02, 2013 - Page 14

The bicycle maker Giant Manufacturing Co (巨大機械) was established amid green rice paddies and earth-god temples, a short ride from the roar of the South China Sea. But for years its founder, King Liu (劉金標), was never big on pedaling around to enjoy the scenery. The main reason he took one of his new products for a spin was to make sure everything worked.

After decades of struggles, it has. Giant is the world’s largest bike manufacturer by revenue. Its factories in Taiwan, China and the Netherlands churned out 6.3 million bicycles last year, generating revenue of US$1.8 billion. The company sells bikes under its own name and makes them for major brands like Trek, Scott and Colnago.

At 79, Liu still puts in 10-hour days as Giant’s chairman. However, after four decades of building bikes by the millions, he has finally started to enjoy them. Trim and tan from daily rides, with close-cropped gray hair and a heart rate monitor strapped to his wrist, he has become the public face of a cycling boom on Taiwan.

“I have a mission to make Taiwan a capital of cycling,” he said.

Since 2007, bicycle sales on Taiwan have surged, bike lanes and paths have been expanded, and the island’s two largest cities, Taipei and Greater Kaohsiung, have launched bike-share programs. At every step Liu has unflaggingly promoted the cause.

His evolution from a small-town tinkerer to an industry titan reflects greater shifts of Taiwan and its economy. Once a workshop to the world, anonymously churning out bikes, cellphones and computers for big-name foreign companies, Taiwanese firms like Giant, HTC Corp (宏達電) and Acer Inc (宏碁) have become global brands in their own right. With those successes come new questions about whether those businesses can continue to lead and innovate.

For Liu, the answer is not just selling more Giant products (though his cycling advocacy campaign certainly helps with that), but focusing on how bicycles can reduce pollution, make people healthier and help cities function better.

“It’s been amazingly successful PR for his company, but he’s not only doing it for that,” said Hochen Tan (賀陳旦), former chairman of Chunghwa Telecom Co (中華電信), and a regular cyclist.

“He’s showing that even people his age can do this. His encouragement and commitment is a driving force for people to follow,” Tan said.

Liu’s transformation, and that of many of his cycling compatriots, was motivated somewhat unexpectedly by a 2007 film, Island Etude, about a young man who bicycles around Taiwan.

“With some things, if you don’t do them now, you might never do them in your life,” was its most often repeated line.

“I saw the film and thought, that line, it’s criticizing me, isn’t it?” Liu said. “I was 73 and I thought, if I don’t ride now, I’ll never be able to do it.”

So he took up the film’s challenge, planning a circumnavigation of Taiwan.

He trained for six months, but admits that was not enough. Images of the 2007 ride show his round belly pressing against his jersey, his face locked in a scowl.

“Oh, that trip was really miserable,” he said. “I had back pain, sleep apnea, high blood pressure and so on. Old people’s problems.”

At one point he was knocked down by a car and scraped, but he persevered, finishing 575 miles in 15 days.

In business he has shown the same determination. After graduating from a technical high school, he cast about at several professions — transportation, chemicals, food imports, hardware — before deciding to build a bike factory with several friends in 1972. He was 38 and still reeling from the loss of his previous venture, a coastal eel farm that was destroyed in a typhoon.

“For the first four years we had no orders,” he said. “The image of products from Taiwan was very poor.”

Having learned to speak Japanese as a child while Taiwan was under Japanese occupation, he traveled to Japan and studied what was then the premier bike manufacturing economy. A major breakthrough came in 1977, when Giant chief executive Anthony Lo (羅祥安) negotiated a deal with Schwinn to begin manufacturing bikes for the iconic American brand.

Schwinn became both Giant’s strength and weakness. Bike sales leapt in the US during the oil crisis, and after workers at the Schwinn plant in Chicago went on strike in 1980, Giant became an important supplier, producing more than two-thirds of Schwinn’s bikes by the mid-1980s.

Then Schwinn decided to find a new source, and in 1987 signed a contract with China Bicycle Co (中華自行車公司) to make bikes in Shenzhen, near Hong Kong.

“We were terrified,” Liu said.

Giant relied on Schwinn for 75 percent of its orders, and its survival was at risk.

Giant began focusing on building its own brand, setting up operations in Europe and the US. Gradually sales of Giant-brand bicycles grew. At the same time Schwinn’s fortunes declined, and it filed for bankruptcy in 1992. The US company was never able to get cheaper production from its China Bicycle investment, said Jay Townley, an industry consultant who was an executive at Schwinn and later Giant’s US arm.

Townley, who has known Liu since the early 1980s, said in that era most bike executives weren’t interested in fitness.

“Everybody smoked, everybody drank,” he said. “There were some cyclists, but rarely like what you see today.”

Liu, he said, was better known as a ballroom dancer.

Now Liu focuses on his bike. He racks up about 40km a day, riding in the early morning around Giant’s headquarters in Greater Taichung. He feels depressed when he cannot train because of rain or work trips.

“I can’t stop riding,” he said.

In 2009, he followed up his trip around Taiwan with a 1,609km ride to Shanghai from Beijing. It was a logical next step. Giant’s manufacturing is now largely based in China, where it has six factories. China dominates global bicycle production, but Taiwanese companies either own or operate the factories that produce about 80 percent of China’s bicycle exports, industry analysts say.

While China’s legions of bike commuters have declined in recent decades, the number of recreational cyclists is growing, making it a crucial market. Giant is one of the most popular brands in China, thanks to a strategy focusing on higher quality, more expensive bikes.

However, while recreational cycling is rising in China, it has taken off in Taiwan.

Bike sales hovered around 600,000 annually for most of the 2000s before surging to 1.3 million in 2008. Taiwanese now buy about 900,000 bikes a year.

Liu believes that Taipei, with its car and motorbike-clogged streets, is the biggest obstacle to making Taiwan a “cycling island.” The city’s government is trying to make it more inviting for cyclists, widening sidewalks to make room for bikes and expanding its bike share program.

Since September last year, monthly use of YouBikes has climbed nearly sixfold, to more than 790,000 trips in May.

Liu knows he can personally draw people to cycling. For his 80th birthday next year, he plans to ride around Taiwan again, repeating his 2007 route.

“I want to show I’m even stronger than when I started,” he said. “If my stamina is better than when I was 73, that should be a big news story.”