Taiwan Today

Taiwan’s bicycle industry has undertaken atour de force with high-end products gaining ground worldwide.

  It all started with a sign attached to the door of a bicycle shop in the United States around half a century ago seen by Ike Tseng (曾鼎煌). It said: “We don’t repair poor quality Taiwan bicycles.” The image haunted him, and when he founded Merida Industry Co. in the central county of Changhua in 1972, it triggered the desire to improve the reputation of bikes made in Taiwan. In the same year Giant Manufacturing Co. started to operate in what is now Taichung City in the central region. As the two enterprises with their now-famous brands are celebrating their 50th anniversaries this year, it is evident that the country has built a solid reputation for its high-end bicycles over the decades.

  Enterprises producing premium bikes—whether under their own brands or as contract manufacturers and bike component producers like KMC International Inc., the world’s largest maker of chains—constitute an industry staple, according to Taiwan Bicycle Association (TBA). Impressive in terms of quantity in earlier years, the sector now stands out for the quality of products with value-added features like suspension systems or road-gripping tires, which are especially made with cycling enthusiasts in mind rather than commuters.

The peloton of the bike industry is clustered in central Taiwan, fostering symbiotic development with component and part producers. TBA Secretary General Gina Chang (張蕙娟) said that without a doubt, Merida and Giant lead the sector as rare locally based businesses that pulled ahead of other bike manufacturers to achieve worldwide fame. The association’s statistics tell the story of mass-produced low-end bikes giving way to high value-added bespoke velos. In 1991, Taiwan exported 9.83 million units valued at nearly US$1.1 billion, whereas in 2021, 1.98 million bicycles with a total value of US$1.3 billion were exported. The growth in electric bikes is even more phenomenal, with sales reaching US$1.3 billion in 2021, up from US$885,000 about 30 years ago. The export value of bike parts alone last year stood at US$2.5 billion.

As he guides visitors around the section of his factory where sophisticated upmarket products are manufactured—which can fetch up to US$19,000 a unit—Fritz Jou (周丁才), president of Taichung-based Fritz Jou MFG. Co. (FJM), said, “Businesses in Taiwan focus on premium bikes. That’s the strategy for growth in the face of stiff competition.” Thirty young, skilled workers are busy in the premium product area using high-quality components sourced both domestically and from abroad to put together bikes with precision and efficiency. Each of them assembles and fine-tunes just one bike at a time, with the focus on quality control, making sure every step in the procedure is perfect.

  Taiwan industry players pride themselves on high-end innovation, creating a technical sophistication that sets them apart from those who churn out standard products. FJM has been an original equipment manufacturer since the 1980s and has never ceased investing in advanced processes to remain competitive. It stayed ahead of the curve in 2015 by adopting an automated guided vehicle system used to move heavy materials, and then in 2016 applied RFID, or radio frequency identification, to track every single component via an electronic tag in order to improve production efficiency.

In Tandem 
Merida and Giant worked together to launch the A-Team in 2003, an alliance of the country’s bike and bike part producers forged in response to a rising China positioning itself as a bike manufacturing powerhouse. “The group facilitated communication and cooperation among its members to create synergy and improve mutual competitiveness,” Chang said. She noted that the A-Team was best known for promoting the Toyota production model. At its core was the concept of just-in-time inventory management, a system developed by the Japanese automaker that requires manufacturers to order and receive only as much inventory as is needed for immediate use and so demands its supplier network be highly organized. 

The two brands seek to get ahead through investment in product and production equipment upgrades. “We’ve developed one of the world’s most advanced bicycle production facilities here in Taiwan, paired with our highly skilled and forward-looking R&D center in Germany,” said Merida President Michael Tseng (曾崧柱). Merida produces a wide range of bikes, most in the mountain bike (MTB) and road bike categories. A recent addition is a gravel bike, a hybrid of road and mountain models added about four years ago to respond to a growing trend in the United States and Europe. 
  The research team in Germany has helped the company earn numerous honors, including Taipei Cycle d&i gold awards in 2021 and 2022 presented at the prestigious annual exhibition in Taiwan’s capital. Last year’s winner was a product with outstanding aerodynamic performance, suitable for fast riding on a flat road. This year accolades from judges went to an all-round ultra-light road bike that eases progress up steep inclines. 

The e-bike is a vehicle with strong input from Merida. With an electric motor to take some of the effort out of pedaling, the e-bike is increasingly popular with people interested in getting out into nature with greater ease. The enterprise is quick to respond to market needs, launching products like an e-MTB called eOne-Sixty that emerged as the top performer in a test of the world’s best high-end models conducted in 2021 by E-Mountainbike magazine.

Gearing Up
As the production side constantly innovates, large-scale marketing events like Taipei Cycle are essential to exhibit new products to the world. Co-organized by TBA and Taiwan External Trade Development Council, the event has grown to be the world’s second largest international exhibition of its kind. In 2020 TBA began to assist selected small and medium-sized companies to produce short but effective videos promoting their products in English on its YouTube channel, along with clips introducing d&i award winners to the world.

Taiwan’s brand names are also sponsoring star athletes and professional teams to broaden their influence. Giant has enlisted Kristian Blummenfelt, the gold medalist in the men’s triathlon at the 2020 Tokyo Summer Olympics, as well as BikeExchange-Jayco, an Australian professional road race cycling team competing in the UCI World Tour top-level series of events. Merida, ahead of the pack, started to systematically sponsor elite professional teams and individuals in the late 1990s and is now backing Team Bahrain Victorious, which won the best team award at Tour de France in 2021. “Racing has always been a strong strand of Merida’s DNA,” Michael Tseng noted. “The interest in racing has been a catalyst for numerous product developments.”

Freewheeling Fun
The surge in cycling for fun is a worldwide phenomenon fueling industry development. In Taiwan Merida organizes events to popularize cycling as well as promote its brand, such as the annual Changhua Classic 100, which attracted 5,000 people to the county this past April to enjoy a 107-kilometer route. Similarly, Giant encourages people to take up the sport by organizing Ride Like King. Named after company founder King Liu (劉金標), a cycling enthusiast who inspired many in 2007 by completing a round-island trip at the age of 73, the annual social event draws in riders from around the country, with parallel activities held in communities around the world. The overwhelming interest in such organized rides reflects the mass appeal of the sport as both a fitness and leisure activity. 

“Taiwan’s bicycle industry is growing fast and there are reasons to anticipate further robust development, notably the growing awareness of the public about reducing carbon emissions and getting more exercise,” said Michael Tseng, adding that a well-integrated international distribution network has helped Merida become a trusted name in the 70 countries it operates in. That said, he emphasized that the industry in Taiwan should be alert to challenges like the increasingly fierce competition from ambitious businesses in Southeast Asia. “Enterprises here must continue investing in innovation research to ensure Taiwan remains a strong force in the industry.”
 

Write to Oscar Chung at mhchung@mofa.gov.tw