First in Series of Price Hikes for Components Announced

AMSTERDAM, the Netherlands – Component makers have already or are about to announce price increases for their products. The China labour crisis; the euro exchange rate; hikes in shipping costs as well as higher prices for  raw materials like butyl and aluminium are forcing component makers to increase their prices by 5 to 6%.

Next to the increases component makers are also hesitant about quoting prices for longer periods in time as prices for, for instance aluminium, show a very unstable picture. Asked whether the biggest in bike components – Shimano Inc. – is also raising its prices, the people at the company’s headquarter in Europe answered that, so far, they didn’t hear about such considerations in Japan.

It is likely that the June 1 price increases for bicycle components will be followed by more hikes. In particular when the Chinese government under heavy pressure for the US and EU, decides to finally take action on the yuan appreciation. As reported in last week’s Bike Europe’s Newsletter bank economists expect that this appreciation will take place during the third quarter of this year. They indicate a possible 15% raise of the yuan exchange rate.