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EU Bike Import Shows Huge Shifts

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BRUSSELS, Belgium – The import flow of bicycles (excluding e-bikes) into the European Union is changing rapidly between countries. It initiated an investigation on re-routed bikes made in China for circumventing the ant-dumping duties which was announced by the European Commission on September 26, 2012.
Strongman
The huge increase in Europe’s import from Cambodia is triggered by Strongman and A&J. Strongman moved its production from Thailand to Cambodia. Export is expected to expand even more with Specialized branded bikes.

In last week’s newsletter Bike Europe reported on the investigation into the accusation by the European Bicycle Manufacturers’ Association (EBMA) that bikes made in China destined for Europe are illegally re-routed and re-packaged through Indonesia, Malaysia, Sri Lanka and Tunisia. This week we dig deeper into the European Union’s imports of bicycles in 2011 and during the first half year of 2012. It shows that there are huge shifts taking place.

Upswing in imports from Cambodia

What is in particular striking is the massive upswing in imports from Cambodia. In 2011 the European Union imported 366,000 bikes from Cambodia which took the country to the 9th place in the Top Ten ranking of the biggest bike supplying countries of the EU. In the first half of 2012 the country managed to almost triple its bike export to the EU. Cambodia’s export totaled close to 520,000 units in the fist six months of 2012 compared to 140,000 in the same period of 2011.

Strongman and A&J

The huge increase in Europe’s import from Cambodia is triggered by Strongman and A&J. Strongman moved its production from Thailand to Cambodia. With that the company is able to benefit more from the Generalized System of Preferences (GSP). The GSP is a trade arrangement through which the EU grants developing countries reduced import duties. Cambodia is granted the GSP+ status. As a result exported bikes, parts and accessories can be imported free of any charge into the EU markets. The regular import duty on bicycles entering the European Union from outside the EU is 14%.

More growth for Cambodia

Strongman is a main supplier of ZEG; Europe’s biggest dealer cooperative with over 1,000 retailers in the EU. In 2010, ZEG sold about 1 million bicycles from well-established brands like Hercules, Gazelle and Giant as well as the exclusive ZEG brands Pegasus and Bulls.

Cambodia’s bike production in 2012 increased also as A&J expanded its capacity. This (Taiwan based) maker is already for some years operating in Cambodia where it is now also producing alloy frames.

According to sources inside the country, the export from Cambodia is expected to expand even more in the coming years. In particular as Specialized branded bikes are now also assembled in the country. With that Cambodia is turning even more towards high-end bikes which is reflected in the average value per imported unit. That value increased by 34% in the first half of 2012 to 191 euro per unit.

Philippines and Bangladesh

Apart from the investigated countries Indonesia, Malaysia, Sri Lanka and Tunisia, others that stand out in the EU imports of bicycles in 2011 and the first half year of 2012 are the Philippines and Bangladesh. In the first six months of 2012 the Philippines managed to increase its export to the EU with 28% tot 323,000 bikes. Average value per unit is low with 44.17 euro while there are no reports on companies that shifted production to the county or the opening of new factories in the Philippines. This is not the case with Bangladesh where Meghna Group increased its production capacity over the years. Export to Europe increase by 28% in the first half of 2012 to 265,000 units which had an average unit value of € 85.63.

China and Turkey
Also China and Turkey are standing out; China because its export to Europe dropped hard (with 36%) while the same goes for the average value per imported unit (with 68% to 35 euro). The reason for this huge drop in units and value is caused by the fact that the e-bike export from China to Europe are no longer included in the EU import statistics for the first six months of 2012. From January 1, 2012 the e-bike import is tracked separately as these bikes got their own CN Codes within the Eurostat statistics. Tracking the separate CN Codes for e-bikes and speed pedelecs shows that 198,000 e-bikes were imported from China and 74,000 speed pedelecs in the first half of 2012.

Turkey is for the first time entering the Top Ten ranking of bike supplying countries to the EU. This is caused by the fact that Bianchi Turkey has been taken over by Accell Group which is sourcing bikes from its new subsidiary.

Country 2012 Jan-Jun 2011 Jan-Jun +/-2012 vs 2011
Taiwan 1,302,575 1,553,381 - 16.15%
Cambodia 519,389 139,988 + 279.15%
Sri Lanka 433,269 474,639 - 8.72%
Indonesia 411,703 432,241 - 4.75%
Philippines 323,067 253,122 + 27.63%
Thailand 320,929 569,460 - 43.64%
Bangladesh 264,822 206,448 + 28.28%
Tunisia 230,426 249,526 - 7.65%
China 177,331 277,542 - 36.11%
Turkey 139,714 127,229 + 9.81%
Total units 4,455,321 4,718,244 - 5.57%

Source: Eurostat

by Jack Oortwijn last update:10 Oct 2012

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