Giant Remains Cautious About E-Bike Future
TAICHUNG, Taiwan – Giant had a difficult 2016 with a cumulative revenue decline of 5.57% to USD 1.87 billion (€ 1.74bn) from the previous year. Although sales from e-bikes, mainly in Europe, soared 50% year-on-year in 2016 Taiwan’s biggest manufacturer remains cautious about future revenue in this product category.
Giant Manufacturing Co Ltd reports in its financial statement over 2016 that the e-bike sales contribution stood at 7% of the total revenue. The company expects this will grow to only 10% in the next five years. While others anticipate on a rapidly expanding e-bike market in and outside Europe, also thanks to the growing e-MTB sales, Giant’s expectations in this product category are cautious.
Sliding revenue in China
In 2016 the company saw its net profit fall 20% year-on-year to US$ 79 million (€ 73.6mn). Revenue from its China operations contributed 18% of the company’s total sales last year, while sales from Europe and the US accounted for 31% and 21% respectively.
Giant’s decline in sales and profit last year was mainly due to sliding revenue from China. Also for 2017 Giant has its concerns about its business in China. The volumes are increasing again, particularly in the low-end of the market, while the competition is still intense, Giant reported.
Apart from Europe, the company said it also plans to expand its e-bike business in the US and Australia this year. Giant will also to launch its first Liv branded e-bike in the first half of this year.