[Exclusive] Giant Bicycles' Mainland China Sales Plunge 65% Amid Bike-Sharing Craze
Qian Tongxin
DATE:  Nov 20 2018
/ SOURCE:  yicai
[Exclusive] Giant Bicycles' Mainland China Sales Plunge 65% Amid Bike-Sharing Craze [Exclusive] Giant Bicycles' Mainland China Sales Plunge 65% Amid Bike-Sharing Craze

(Yicai Global) Nov. 19 -- Giant Manufacturing, one of world's biggest makers of bicycles, has seen sales in the Chinese mainland slump 65 percent as bike-share companies looked to other producers for supplies. 

"Shared bikes have greatly impacted us," Chairwoman Bonnie Tu said in an exclusive interview with Yicai Global last week. "From our viewpoint, the biggest mistake domestic shared-bike companies made was to not find a professional bike manufacturer like us to be their partner. We have always been open to cooperation."

The Taiwan-based company's annual sales in the rest of China fell to less than 1 million units last year from 3 million in previous years. Even with six factories in the mainland, Giant has not benefitted from the emergence of the bike-sharing phenomenon and its overseas expansion is threatened by higher tariffs, jeopardizing the company's 'made in China and sold to the world' business model.

Giant's sales in Europe and America have been boosted by the demand for electric bicycles in those markets. Its European revenue jumped 40 percent in the first three quarters, according to the company's latest financial report.

But the European Union has unveiled plans to impose tariffs on imported bicycles next year, ranging from 21.8 percent to 83.6 percent, to boost local manufacturers, who have been severely hit by rivals. Giant faces imports duties of 27.5 percent.

The number of e-bikes exported from China to the EU tripled between 2014 and 2017, during which time the country's market share rose to 35 percent with the average price falling 11 percent, according to EU statistics.

"China was like a world factory in the past," Tu said. "Most of Giant's products sold worldwide were made in China. The pattern will change in the future. We'll focus on short-chain supply and quick-market response."

Giant will consider producing more bikes in the markets they are sold in, she added. The firm has a factory in the Netherlands, and new plants in Hungary and other places will be built next year.

Giant is also looking into the possibility of assembly lines in the US because of uncertainties brought about by trade friction. Specific plans have not been decided yet because production migration takes a long time, and factors such as the cost of integrated parts and components need to be taken into consideration, Tu said.

Editor: Bivash Mukherjee

Follow Yicai Global on
Keywords:   Business Strategy Adjustment,Bicycle Maker,Bike-Sharing