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Rising Lead-Times for Alloy Frames; Bike Makers Turning to Eastern Europe

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The lead-times for alloy frames produced in China are on the rise. Volume bike makers in Europe are now planning to start a joint frame facility in the Ukraine in order to become more flexible. For years the regular lead-time for in China produced alloy frames was 15 weeks. Currently that lead-time stands at about

Rising Lead-Times for Alloy Frames; Bike Makers Turning to Eastern Europe

AMSTERDAM, the Netherlands – The lead-times for alloy frames produced in China are on the rise. Volume bike makers in Europe are now planning to start a joint frame facility in the Ukraine in order to become more flexible.

For years the regular lead-time for in China produced alloy frames was 15 weeks. Currently that lead-time stands at about 25 weeks. The situation could even deteriorate further as the effects of the Chinese New Year holidays are not yet completely clear. Have all the workers come back to their employers or have they switched to new ones?

Next to workers/welders switching employers there’s also a consolidation trend going on among Chinese producers. The new labour regulations that went into force January 1, 2008 caused hundreds smaller companies active in the bike sector to cease operations.

And, with Chinese suppliers demanding upfront payment, the US dollar hitting a high against the Euro, and all the logistics problems and stretched lead times that come with sourcing in Asia; there’s a growing interest in production closer to the market. Eastern Europe offers possibilities for just that.

In order to become more flexible some of the volume bike makers in Europe are joining forces and planning to start frame production in Europe all over again. That production is to take place in low-labour-cost Ukraine, a country with a long history in metal processing. Bike Europe will publish more on this development in its April edition which also features a special on frames & forks.

 

 

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