News Article

E-Bikes Push Merida Revenues by 33 Percent in first Nine Months

Sales & Trends

TAICHUNG, Taiwan – Electric bicycles are turning out to be the big money-maker for Taiwan’s bike industry. At least, it is for the 2nd biggest maker of the country, Merida. It saw its revenue from Taiwanese operations grow by 33 percent with (e-bike) shipments up by 27 percent during the first three quarters of this year. Next week’s Taipei Cycle Show (taking place from October 31 to November 3) will reflect the rapidly growing relevance of electric bikes for the Taiwanese industry.

E-Bikes Push Merida Revenues by 33 Percent in first Nine Months
Merida CEO Michael Tseng. Company follows trend of all major e-bike makers; up in revenue, but drop in units shipped. – Photo Bike Europe

According to a report in the Taipei Times the results of Merida over September 2018 were slightly disappointing. However, this did not mean that financial analysts and institutions changed their optimism about the future results of the company. They even expect a 40 to 50 percent rise in e-bike orders in the fourth quarter of 2018 which is regarded as peak season for e-bike production and shipments. It is forecasted that Merida’s e-bike shipments would increase to between 145,000 and 155,000 units this year, from 93,300 units last year. By the way, these forecasts are on par with Taiwan’s e-bike export to the EU. During the first six months of 2018 that export was up by 54 percent from 64,000 units in 2017 to 98,000 e-bikes in the first half of this year.

40 to 50 percent rise in e-bike orders

Growth triggered by e-bikes

In the first nine months of 2018 Merida’s total revenue increased by 19.7 percent to TWD 19.93 billion (561 million euro). That this growth was triggered by e-bikes is indicated by a close to 5 percent drop in the total for shipped bikes which stood at 917,000 units. Also declining sales in China could not affect the big increase in total revenue. By the way, Merida’s China operations account for nearly 10 percent of the company’s revenue.

With this development – up in revenue, but drop in units shipped – Merida follows the trend that all major e-bike makers show.

Operations in China still under pressure

Merida’s operations in China are still under pressure as the bike market of the country declined further. Taipei Times reports by quoting financial analysts that “US President Donald Trump’s punitive tariffs on Chinese goods have had limited effect on Merida, as the company’s exports to the US are mostly manufactured in Taiwan.” These analysts also point to delays of key components causing lower Merida revenues in September, but as well state “Merida is a veteran e-bike maker. E-bike sales growth, the bright spot for the firm’s long-term operations, will more than compensate for weaker sales of its traditional bicycles in China.”

No dumping duties for Merida e-bikes

Merida is not affected by the provisional anti-dumping duties on e-bikes which have been imposed by the European Commission July 18, 2018. The company does not export e-bikes from China to Europe as it has been investing heavily in its Taiwan production of these bicycles. In March 2017 Merida announced that its new e-bike production facility was up and running. Production capacity stood at 10,000 units per month which since has been expanded to 25,000 e-bikes per month. Merida has added a second floor to its e-bike facility for increasing the production. The Merida announcement also said the company is working closely with Shimano for equipping the e-bikes with Steps mid-motors.

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