I have been spending a lot of time at our factory in Cambodia which produces bikes for the European market and can deliver the bikes at 0% duty as opposed to shipping from China which attracts 48% duty due to the heavy anti-dumping policy in place in the EU. This has led to a number of new factories springing up in Cambodia and some unexpected price hikes due to the increase in demand. In order for me to deliver a bike to the EU duty free from Cambodia I have to prove 30% localization – meaning that 30% of the final product must be sourced in either, Cambodia, Vietnam or Thailand. Since there are no good quality part makers in Cambodia we have sourced the parts and frames from Taiwanese owned factories in Vietnam, with the rubber products (tyres and Tubes) coming from Thailand. However the price of the steel frames produced in Vietnam are now much more expensive than similar products from China. This has resulted in our factory having to invest in our own frame welding line, starting with steel frames for now. Oddly enough the alloy frame price out of Vietnam has been unaffected leaving me wondering for how long the trusty cheap steel framed bikes we all rode as kids will be around.
Posted on: Wed, 31 Jul 2013 17:34:12 +0000
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