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<b>Portugal 2009:</b> Crisis Hits Portugal Hard

Sales & Trends

With bankruptcies, huge decreases in production and companies on stand-by, 2009 has been a year of re-definition for bike production in Portugal. The economic crisis has definitely taken its toll. Bike production has been

<b>Portugal 2009:</b> Crisis Hits Portugal Hard

LISBON, Portugal – With bankruptcies, huge decreases in production and companies on stand-by, 2009 has been a year of re-definition for bike production in Portugal. The economic crisis has definitely taken its toll.

The Bike Market in Portugal (x 1000 units)*

 
2003
2004
2005
2006
2007
2008
2009*
Domestic production
580
690
1200
1200
900
1500
998
Imports
81
70
65
70
133
168
170
Exports
370
530
980
980
700
n.a.
760
Consumption
295
270
290
300
330
n.a.
400

*Estimates

Bike production has been growing in Portugal for the past years. Last year, with the big contribution of RTE (assembler for Decathlon) of almost 1 million bikes, total production for the country was nearing 1.5 million units. At the beginning of the crisis the perspectives were still good, but soon international orders decreased and stock mounted. So, the solution was to slow down the assembly lines.

RTE/Decathlon

Naturally, the biggest slow-down was at RTE also. With a huge production in 2008 and a crash in sales/orders on Decathlon’s shops, the Portuguese assembler saw its plans for a record number being postponed. Earlier, optimistic estimates predicting more than a million bikes soon met a 325,000 unit reality. This situation influenced the overall country’s success, since the other players have kept their figures more or less stable.

Sirla, recently undergoing an image renewal and proceeding to a new location with modern machinery, is now facing real economic trouble and has stopped production. They did come out with 25,000 units so far this year, but the future appears uncertain and dismal.

Vag also shut its doors, facing bankruptcy. Income wasn’t enough to pay for expenses – the solution: sell the brand rights and remaining stock to Motoacessórios Famalicense. This company has been around for some years, producing entry level bikes. They hope to reach production of 17,500 units for 2009 also selling the remaining of Vag’s stock at very low prices.

Neighbours in business

Spanish brands continue to be responsible for a considerable amount of the Portuguese bike production. Orbea, Agece and BH claim 80,000 units each and Interbike (Coluer bikes) another 30,000.

Portuguese Órbita, the oldest national manufacturer (along with the Miralago branch – producer of gym machines) keeps producing the Vélib bikes for Paris and has started their own bike sharing/renting service in the centre/north of the country, as we have reported recently.

In spite of all these situations, bike production is still healthy. But the future is yet to be determined. The unexplored City Bikes business in Portugal could be one life-saver. Will 2010 bring bigger numbers to bike production or will the crisis still be muffling bike sales? The path is still long and far away.

 

 

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