Taiwanese bicycle manufacturers reported robust revenue growth of 40 to 80 percent in the first two months of this year, with some hitting record highs for January and February, the companies’ data showed last week.
Solid growth momentum and strong orders amid the COVID-19 pandemic-driven bicycle boom would boost the industry’s revenue this quarter, analysts said.
Giant Manufacturing Co (巨大機械), Taiwan’s largest bicycle manufacturer, posted combined revenue of NT$12.19 billion (US$432.5 million) for January and last month, up 40.08 percent from the same period last year, which the company attributed to strong global demand for bicycles amid the pandemic.
Photo: EPA-EFE
Merida Industry Co (美利達), posted cumulative revenue of NT$4.83 billion in the first two months, up 43.74 percent year-on-year, the highest for the period in the company’s history.
Merida, which also sells bicycles under the Specialized Bicycle Components brand, shipped 183,078 bicycles in the two-month period, up 50.05 percent from a year earlier, Merida said in a statement.
Cumulative revenue at Lee Chi Enterprises Co (利奇機械), which produces bicycle components under the Promax brand, surged 81.13 percent to NT$604.02 million in the same period, the company said.
Bicycle chain maker KMC Kuei Meng International Inc (桂盟國際) reported revenue growth of 71.21 percent to NT$1.11 billion, while Topkey Corp (拓凱實業), which produces carbon fiber bicycle parts, reported revenue growth of 52.66 percent to NT$1.29 billion.
Revenue surged due to lifestyle trends amid the pandemic, which raised many people’s awareness of health and physical fitness, analysts said.
Global bicycle demand would remain robust this year, due to governments worldwide promoting cycling and subsidizing bicycle purchases, they said.
“Over the past 25 years, bicycle sales have seen steady annual growth at a single-digit percentage every year,” Yuanta Securities Investment Consulting Co (元大投顧) analysts led by Peggy Shih (施姵帆) said in a note on March 5. “However, amid the COVID-19 pandemic, global bicycle sales volume increased 32 percent year-on-year in 2020.”
Global bicycle orders have doubled or even tripled, and the production lead time is now one to two years, compared with about 60 days before the pandemic, Shih said.
Inventory levels are to drop to record lows amid strong market demand, while strong end-demand has intensified components shortages in the short term, she said.
Delivery times for some bicycle parts have increased to about 300 days, Shih said.
Larger manufacturers such as Giant and Merida have advantages in terms of material and component purchases, and greater bargaining power for finished products, Shih said, projecting that the two firms’ shipments would increase 10 percent and 15 percent respectively this year.
Despite tighter supply, order visibility for KMC’s high-end bicycle chains has extended to the end of this year, she added.
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
RSS