A bit of a reprieve has been granted from tariffs on certain carbon bicycle frames - up to a landed, wholesale value of $600 imported from China to the USA,
Bicycle Retailer reports.
Bikes and components from China are currently subject to 25% tariffs and this has
started to affect the bottom lines of cycling companies so it will be welcome news for the industry.
This latest exemption was requested by Parlee Cycles, a road bike brand, and will apply to frames alone, not frames as part of complete bikes, until August 7th, 2020. Parlee currently manufactures its Altum framesets ($4299 USD retail for frame and fork) in China and argued that manufacturing the frames in America or the startup costs of moving to a manufacturer outside of China would be prohibitive. It also claimed that passing on the costs of the tariffs to the consumers was "not an option." Finally, it claimed that there was no danger of China acquiring a new technology it does not possess so carbon bike frames are not of "strategic importance." This was enough to convince the U.S. Trade Representative to return the tariff back down to 3.9% as part of its latest round of exclusions.
This exemption is the second that has been granted, with the first being to single speed road bikes. There are 94 further requests for tariff exemptions currently requested by the bike industry so it is hoped that more exclusions will follow. Other tariff exemption requests currently under review include one from Trek on all frames of any material and at any price and another from PeopleForBikes, on behalf of the industry, to request for all frames valued under $600 to be exempt.
With the U.S. Trade Representative clearly willing to make concessions on tariffs on cycling goods entering the USA, hopefully, this is a sign that the expected impact of the trade war on consumers will not be as bad as first thought. We'll keep you updated with further news on tariffs and any relevant exemptions as we get it.
We've sacrificed future generations ability to prosper, let alone survive, for our own ecologically lazy and corrupt greedy intentions.
Welcome to the future!
the 600$ frame exemption is different from the one being requested by Parlee
Well guess what: Sho-Fho-king Wong! Xi Gzonju unlike Spec, will not show up to the court when you want insurance for half of the face you left on the road. He won’t give you warranty, he is not being hold responsible by anybody anywhere.
So what research are you talking about, when clientele of these products are people who are generally clueless. It is not about doing research whether a particular “brand” is ok. If you chose some dodgy stuff you better make sure you personally know the owners. Which in case of ali is impossible.
I will try to make some frames, and zi honestly have no clue how I will deal with that. I have a builder who I know makes legit stuff but Working 10 years in building sector I am 100% sure that things WILL go wrong at some point and I know there are folks who are making mistakes because they are completely clueless. They are incapable of forseeing them. the best make mistakes. That is why we have such giant safety margins. Things still get fkd and repairs take enormous amount of money. Fortunately before buikdings get inhabited it is all solved. Not a case in bike industry. Safety protocols take time and money, providing physical and social security fir your workers, managing waste, marketing takes their share. That is why there are mark ups on PRODUCTION price of frames. Folks who whine about “it takes 10$ to make a carbon HT” are ignorants.
At the same time I am not really talking about just buying some random stuff off Ali. There are plenty of resources from riders that have purchased and used product that are not clueless. The OEM I purchased from makes/made frames used by a few UCI teams and other clubs. They have a reputation of quality product.
I checked out the Raoul guy. Lot's of stuff about brand name bikes with defects and poor quality control. To me either way is a gamble with Carbon and everyone should purchase based on what they need/want/afford/trust based on their own comfort level.
mises.org/wire/against-trumps-tariffs-0
Global statistics: Global production of carbon fiber is pegged at 135,000 tons (compare that to 24,800,000 tons of aluminum). The largest producers for 2017 were in North America, with the US and Mexico churning out 48,700 tons. Japan is next largest at 27,100 tons, and then China at 13,300 tons. Aerospace uses about 80-percent of the world’s carbon fiber production, with another 15-percent gobbled up by sporting goods manufacturers. Of those, golf and snow sports are by far the largest carbon consumers, with cycling trailing somewhere off the back. The automobile industry is anticipated to become a larger player as it struggles to meet stringent fuel and emission targets looming ahead.
www.pinkbike.com/news/aluminum-vs-carbon-separating-environmental-fact-from-fiction-in-the-frame-materials-debate.html
Understand that the purpose of the tariffs is temporary and intended only to get China to the bargaining table. Right now their economy is under tremendous pressure. They’re desperately hoping to outlast our own will to succeed. IMO there shouldn’t be any exceptions made; not even one. It undermines the the entire process. If you’re even remotely paying attention to what’s going on then you know there are people with purposeful intent working solely to undermine everything. In the end they don’t give one iota of care about you. You’re disposable, a tool; either a purpose to an end or of no use at all. Get in the way and they’ll lie, cheat, whatever it takes to destroy you. And they’ll even enjoy and take pleasure in your unjust suffering. That’s life every day over there. If you’re not careful it will be that way here too eventually.
I’m just wondering how much longer it will be before the “Re-education camps” over there are turned into “factories“ ...
What did you think of the article I linked to and the points that it makes (tariffs don't raise wages and do not create more overall jobs). If the US places tariff on imported carbon frames allowing US carbon frame makers to exist and build frames at a higher price, that higher price the US consumer now pays would have otherwise been spent (or saved) on something else. Example: Instead of buying a $600 Chinese frame they are not buying a $1000 US frame. That $400 is now not available to be spent or saved for something else. You haven't created any new net jobs. You've only boosted the US carbon frame industry at the expense of another. Even worse, you've subsidized an industry that we do not have a competitive advantage in at the expense of other industries where we did have an advantage.
"Another issue is the fact that in America no one from the actual labor force ever sits on the board."
These are important facts that most Americans ignore. Our economy isn't looking for the middle class or anyone who considers themselves an employee, unless all you care about is your 401k that you can't even take until your 65.
However, one of Trump's main objectives was to get China to lower their tariffs. It seems most people don't see that. It is to be seen if will work, but I like the effort because China has been charging high tariffs on US companies for decades and no politician held them accountable for it.
Also, the tariffs are generally smaller percentage in comparison to the markup costs and sales taxes. For example. Lets say a shoe company pays 30 dollars for their shoes. The tariff is 10%. So, now the shoes cost 33 dollars to make. However, the cost for the shoes are 150-200 dollars. 3 dollar tariff is not a lot on a 150-200 dollar shoes in comparison to the markup and sales taxes. For California (9.25%), sales taxes are $13.88-18.50 paid by consumer.
People in China don't ride Schwinns.
"If you’re even remotely paying attention to what’s going on then you know there are people with purposeful intent working solely to undermine everything. In the end they don’t give one iota of care about you. You’re disposable, a tool; either a purpose to an end or of no use at all. Get in the way and they’ll lie, cheat, whatever it takes to destroy you."
Those people are called "capitalists" and they have run America for a very long time. What do you think killed the American labor movement?
This is a geo-political subject that goes way beyond a bike forum, tit for tat, pee-pee match. Good luck.
Any country that imports way more than it exports is going to severely pressure their economy.
Paying $600 for unpainted carbon frames isn't the same thing as painted, assembled, with hardware, with shock if it's a mountain bike, with fork if it's a road bike, then sold to a distributor, then to a bike shop, then to a consumer.
In ecommerce ppl double their cogs cost of good sold just for wholesale pricing and for retail there is another double markup. which takes care of all the components you have mentioned above+profits
I would like bike companies to reduce prices by 75% but the world doesn't work that way.
Best option is to wait and buy previous years models if you want to realistic no profit no loss pricing
1) Contract out a carbon frame to a country that is the largest polluter on the planet who only cares about one thing: a dollar
2) Put that frame onto a ship that is, let's just call it, "less than emissions friendly"
The argument that domestically made carbon frames would be 'way too costly' because of all the 'tooling up' costs has been debunked by Guerlla Gravity Bikes and it's $2450 full carbon frame with shock.
Now, I am by no means a 'climate nazi' but I am doing everything I can to limit my footprint. End of that story.
If I was looking for a carbon frame I could guarantee that I'd only be looking at a domestically built one. Less choice, yes, but I doubt I would end up with a 'sub-par' design as most bikes these days are designed so a dummy like me couldn't really tell the difference between 'suspension design A or B'.
If I'm smiling at the end of ride = success.
Bike shops make very little on frameset sales. My local shop only deals with brands where they can order directly from manufacturer and even then the profit margin for them on a frame is tiny. They make more on ordering the complete builds.
That's a lot of salaries to pay and a lot of shipping to pay and a lot of product that is manufactured and ultimately abandoned. You can avoid all that markup of course. Buy the frame yourself on alibaba, built it yourself, and "self-insure" in that if something's wrong with the end result, you're stuck with it.
Whoever buys 100€+ polos just for a small little man on your chest is stupid.
You only pay for the name- made in the EU clothing with way better garns is less expensive.
For Giant:
2018 Income Statement
Total revenue : $60,239,417
Cost of all goods sold (aka what giant pays for their crap) : $47,747,765
Total operating expenses : $8,455,578
Interest and Tax expenses : $1,559,042
Total income to Giant : $2,863,907
Giant brought in $60M of revenue in 2018, and only got to keep $2M. Thats 3.3% of their total revenue. Oh, you say $2M is a lot of money brought it, pass the savings onto the consumer... Well, if you look at something called a quick ratio, you'll find out that Giant has more liabilities and debts than they do liquid assets and cash. Which means it's not like they are sitting on piles of money and laughing at you for buying a $6K carbon bike.
Everyone has to get paid. Bikes are expensive for reasons. And we keep buying. So there's that.
Can’t you tell he’s involved in the industry and benefiting in some way?
Tl:dr if you’re on this site then bike cost is justified @stumphumper92:
Taiwan != China.
or does "!=" mean not equal?
Why use a suspension fork and shock? It makes your arms stronger!
Why ride a bike? Running is free!
Want a spare part for your one off frame built in Delaware? Oh you’re travelling and are in Finale? Best of luck.
You’re not buying a bike with mark up, you’re buying support. Bike buying decisions for me include a large amount of concern for what the brand is like to deal with, what they network is like.
I always laugh when everyone gets all shitty about these mark ups. Then talk about buying local because of jobs. So short sighted. Think for instance Trek/Giant/Specialized employs nobody? They’ve got design teams, engineering teams, supply chain management team, customer experience teams, and on a global scale. They then employ some Asian labour to build the frames. You can buy one of Ali express, but as we saw in that Taipei series a couple years ago, it’s all about being there and inspecting the QC constantly.
Lightcarbon where I bought my frame I observed multiple people have frame warranty honored.
The very first thing I saw when I opened my box was a nice envelope with my warranty in it.
No, taxes on products that are not made any where other than China just means people buy it at a higher price, or the company that has it made in China sells a fewer. It is almost never a Chinese company that is selling them to the consumer.
So the order from most affected by the tariff to the least affected.
1. Consumer
2. Company that sells product to consumer
3. Local government (loss of tax revenue due to decreased sales)
4. China