Taiwan Today

For bicycle enthusiasts who desire to know what is hot in the world of cycling, the annual Taipei International Cycle Show, or Taipei Cycle, serves as a feast for the eyes and the mind. This year’s show, which was scheduled for March 17–20 at the Taipei World Trade Center’s Nangang Exhibition Hall, was set to feature a wide variety of bikes, from dazzling electric bicycles that offer a smooth, low-noise and no-emission ride to the new technology of “folders,” or folding bicycles, which can be folded in only a few seconds into very compact and portable sizes. Of course, there was no shortage of “big names” planned for the event, as evidenced by the platinum line-up of top brands from Taiwan such as Giant, Merida and Pacific Cycles, as well as a wealth of others from abroad.

In one sense, the history of Tai­pei Cycle parallels the development of Taiwan’s bicycle industry. Before the launch of Taipei Cycle in 1988, Taiwan had already emerged as a “bicycle kingdom” with a huge amount of bike exports, mostly under the low-price original equipment manufacturing (OEM) mode. Despite the volume of exports at that time, Taiwan’s bicycle industry was represented with only a “bicycle zone” at the Taipei International Sporting Goods Show, or TaiSPO. Now, Taiwan is home to many of the world’s leading bicycle brands, while Taipei Cycle has become one of the top three bike shows around the globe.

Taipei Cycle features the latest high-end models and products displayed along the themes of complete bicycles, bike parts and accessories, and light electric vehicles, and attracts thousands of visitors from abroad every year. According to statistics from the Taiwan External Trade Development Council (TAITRA), the organizer of the event, nearly 900 manufacturers from 36 countries and regions were registered to host more than 3,000 booths, making it the largest ever in the show’s 23-year history. “The numbers of exhibitors and booths both reached historic highs this year, making Taipei Cycle the largest bicycle show in Asia and one of the top three in the world,” says Andrea Wu, TAITRA’s publicity manager for the show.

In fact, this year’s show was planned as more than just a trade show, also including a series of supporting activities, such as the Tour de Taiwan, a professional cycling road race; the International Bicycle Design Competition; a forum on bicycle trends; expert seminars and outdoor test rides, all scheduled to coincide with the fair. “Expanding the scale of Taipei Cycle is merely one of our goals. With an emphasis on innovation and service, we hope to provide a platform which spotlights high-end products to meet the procurement needs of professional international buyers,” said Walter Yeh, TAITRA’s executive vice president, speaking at a media preview for the show in November 2009.

This growth has occurred as Taiwan’s former OEM bicycle makers have made the successful transition to original design manufacturers (ODMs), with several companies currently making great strides in evolving into original brand manufacturers (OBMs). James Liu, secretary-general of the Taiwan Bicycle Exporters’ Association (TBEA), describes how this approach has helped local manufacturers, who have proved remarkably resilient during the transformation process. “Taiwan’s current production strategy follows the global division of labor. By emphasizing innovation, high quality and branding, rather than the OEM mode of low-price mass production, as seen in developing countries, local bike makers have made significant inroads in the global market with their high-end cycling products,” Liu says.

“Some internationally renowned enterprises such as Giant and Merida boast complete production processes from manufacturing to marketing and courteous after-sales services,” Liu adds. “They also hold frequent activities to promote cycling, which have made them highly regarded in the cycling world. Now, Taiwan is esteemed globally as an indispensable supplier of high-end, innovative bicycles.”

Innovation was likely to become a key word at this year’s Taipei Cycle, as seen in the diverse collections of products lined up for the event, with many targeting the everyday cyclist.

One original folding design is the iF Mode, registered for display by Pacific Cycles Inc. The iF Mode promises easy, tool-free folding in a mere three seconds, but, unusually, has large wheels. Like a piece of luggage, it is able to roll everywhere on its main wheels even when folded.

“Few people prefer small-wheel folders. Most people choose large-wheel bikes,” explains George Lin, president of Pacific Cycles. “There are a number of reasons for this such as tradition, ease of pedaling, and perhaps most importantly, image. Riding on small-wheel folders would make them look like kids.”

The iF Mode has won many awards at such prestigious events as the 2008 Eurobike and the 2009 iF Product Design Award, where it won a gold medal, as well as a silver award at the 2009 Taiwan Excellence Awards. Interestingly, the iF Mode was used in a German movie about the future, and has been collected by a prominent design museum in New York, which planned to display the bicycle for three years. Since it became available for sale in July 2009, some 400 units have been sold in Taiwan and abroad.

In addition to folders, electric bicycles, or e-bikes, were to be another highlight of this year’s Taipei Cycle. In recent years, e-bikes have gradually become popular as a mode of personal transport for commuters. With the rising price of oil and the appeal of eco-friendly vehicles worldwide, manufacturers are jumping on the green bandwagon to promote the use of battery-powered bikes.

Among these, the db0 electric folding bike, jointly developed by Taiwan’s DK City Corp. and Robrady Design of the United States, was seen as likely to receive a lot of attention. Equipped with a high-tech electric power system to “assist” the rider and an easy-to-operate control interface, the db0 also features a sleek appearance and a highly sophisticated folding mechanism that together won it a gold Spark Award from the US-based Spark design group in the mobility category of the 2009 competition.

For bike racers, Giant Manufac­turing Co. Ltd. was to display its TCR Advanced SL Team Giro ISP, which is a road bicycle employing Giant’s world-class carbon-based advanced composite technology. Weighing a mere 6.5 kilograms, the model nevertheless has an extremely stiff, low vibration frame. Team Rabobank, a famous Dutch road race team sponsored by Giant, secured the overall victory at the 2009 Giro d’Italia on Advanced SL bikes.

While advances in technology and manufacturing have added momentum to growth in the local industry, it is the successful creation of Taiwan’s own brands in the sector that has been a major development among local bicycle makers.

Despite clear signs of a global economic downturn since 2008, Taiwan’s bike exports have remained reasonably stable, which TBEA’s James Liu credits to Taiwan’s branded cycles. “The pursuit of branding has made Taiwan’s cycling industry sustainable in the global economic recession,” Liu emphasizes. In fact, according to TBEA statistics, although the export quantity and export value of Taiwan’s bicycles dropped in 2009 by 20 percent and 10 percent respectively compared with 2008, the average unit price of exported bicycles reached US$289, an increase of 12.6 percent over the previous year. In 2009, the export value of bicycles and bike parts from Taiwan totaled some US$1.75 billion.

While companies including Giant—the world’s largest bicycle maker—Merida Industry Co. Inc. and Pacific Cycles are obvious success stories of local brand development, many of Taiwan’s smaller bicycle manufacturers still rely on OEM/ODM orders from abroad, however, thereby making poor profits as compared with OBMs.

Building Brands

In order to foster an environment conducive to branding and assist the promotion of Taiwanese brands globally, the Ministry of Economic Affairs (MOEA) formulated a seven-year “Branding Taiwan Project” in 2006 to help domestic enterprises build their own brands.

Under the auspices of the MOEA’s plan, TAITRA held a training workshop on brand promotion for the cycling sector in May 2009 in Taichung, central Taiwan, where many bike manufacturers are clustered. Activities included a speech on “creative thinking on branding,” a brainstorming session to come up with marketing ideas and an in-depth discussion on branding among the 40 attendees.

“Brand marketing has become a key issue for industrial restructuring,” says Jennifer H. C. Lo, director of TAITRA’s Taichung Learning Center of Branding School. “This workshop is intended to train and cultivate talented individuals for branding and provide necessary assistance to nearby cycling manufacturers.”

Since 2003, TAITRA has worked with Interbrand, a well-known brand appraisal consultancy, to develop the annual Top Taiwan Global Brands ranking, which selects the nation’s 20 most valuable global brands. Not surprisingly, three bike-related companies, namely Maxxis, which produces tire and rubber products, Giant and Merida were among Taiwan’s top global brands in 2009.

“The bike sector is one of the few traditional industries in Taiwan that has good output volume, production technology, brand image and sales channels,” TBEA’s James Liu says. “Its success can serve as an example for local businesses in pursuit of their own brands.”

An unusual example of branding success can be found in Pacific Cycles, which was founded in 1980 and has always positioned itself as a “global design workshop.” With the aim of building a state-of-the-art working environment for like-minded designers around the world, the company has adopted a unique business strategy to provide a powerful research and development platform for more than 40 celebrated brands worldwide, as well as a factory that specializes in quality, high-end products.

Adding Excitement

“Our job is to create exciting products to meet the needs and expectations of enthusiasts,” company president George Lin says. “We are willing to commit our effort and resources to products that might not show tremendous market potential.” Refusing to compete with other bike makers for conventional market share, Pacific Cycles has instead turned to niche markets with its technically exquisite products, and by doing so has captured a throng of devoted customers worldwide.

Over the years, Pacific Cycles has garnered a wide range of accolades at home and abroad, including Japan’s 2001 Good Design Award, and Taiwan’s 2002 National Outstanding Small and Medium Enterprises Award, 2002 Rising Star Award and 2008 Taiwan Superior Brands Award for its Birdy folding bikes, as well as the latest honors for its iF Mode folders. Moreover, the company was featured in Taiwan’s Commonwealth Magazine in 2006 as one of the “25 New Hopes for Taiwan.” Currently, the company has five product series under the Pacific brand—Reach, CarryMe, Micah, Handy and 2Rider.

Meanwhile, Giant is striking out to tap the underserved market of women cyclists with women-specific bicycles and apparel. Several years ago, Giant’s CEO King Liu directed the company’s executive vice president and CFO Bonnie Tu to plan the first all-women’s bicycle store in Taipei. The company opened this dedicated women’s bike boutique, Liv/giant, in Taipei in April 2008.

“Women have been an afterthought in the male-dominated world of both the design and use of bicycles,” Tu says. “From a female perspective, these ordinary products appear lackluster in their traditional, male-designed form, and thus few women feel a great desire to buy them.”

“We stress fashion and lifestyle and offer bikes, clothing and accessories specifically designed to cater to women’s tastes and needs,” Tu says. For example, to make bikes more female-friendly, adjustments have been made to the shape of the frame, the height of the seat and the relative positioning of the handlebars. Some of the models also include a stylish detachable basket.

Giant’s vision proved correct. In 2009, the Taipei boutique’s annual revenue ranked in the top 10 of Giant’s more than 400 outlets in Taiwan. More importantly, it served as a pilot project for Giant to develop a retail strategy to lure more women into cycling. “This January, we saw the second Liv store open in Kaohsiung. The next one will be in Taichung, scheduled for April. We also hope to launch our first female cycling shop abroad in Tokyo this summer,” Tu says.

While almost all industries have been caught up in the recent global economic storm, Taiwan’s bicycle industry has remained relatively stable through its technological know-how and innovative designs. The products that were set for display at the 2010 Taipei Cycle are very likely to define coming trends, styles and prospects in the world of cycling. Having struck out on a new path for success, Taiwan’s bicycle makers, and now bicycle brands, are well prepared to keep the wheels rolling and to continue to play a leading role in the global bike market.

Write to Dennis Chang at dennis0602@mail.gio.gov.tw