Taiwans Top-3 Bike Makers Saw Revenues Drop

TAIPEI, Taiwan  – Despite all the buzz at the Taipei Cycle Show earlier this month about Taiwan’s bike boom; Giant, Merida and Ideal suffered revenue decreases in the first two months of this year. Giant reported a 19.55% revenue drop from its Taiwan plant. Giant's consolidated revenue (including overseas operations) during the period, however, was up 3.33%. Merida saw its Taiwan operation drop 2.58% in revenue and Ideal Bike Corp. reported a first-two-month down in revenue of 6.91%. However, all three are optimistic about the whole-year business results.

Giant produced and sold about 5.05 million bicycles in 2005, including 790,000 units from its Taiwan plant, 2.68 million units from Giant (China) Co., Ltd., 1.15 million units from Shanghai Giant and Phoenix Bicycle Co., Ltd., 270,000 units from Giant (Chengdu) Co., and 160,000 units from Giant Netherlands. Giant's consolidated global revenue was TWD 25.4 billion (€ 645.8 mn). The company will continue to pursue a growth in average selling price rather than in volume this year. Marketwise, the company expected its sales to rise in North America, stay at a high level in mainland China and fluctuate slightly in Europe.
Merida estimated that it would have a 5% revenue growth this year. The company produced about 50,000 carbon-fibre bikes with high unit prices last year, with 30,000 units of which supplied to Specialized of the U.S. and the rest sold under Merida brand. Merida said that the high-margin carbon bikes contribute significant profits to its operations. This year, the firm will push the composite-frame (aluminum for front frame and carbon for rear frame) bikes.
Ideal said that it would challenge an annual shipment goal of 1.25 million units from its plants in Taiwan, Dongguan (Guangdong Province of China), and Poland. (MH)