Amid rising tensions in the U.S.-China trade war, American consumers are facing the prospect of steep bicycle price hikes.
What Happened: The cycling industry, already under pressure, is warning of potential bankruptcies and mergers as a result, reported the Financial Times on Friday. The tariffs imposed by President Donald Trump are heavily impacting an industry largely reliant on Chinese manufacturing. Arnold Kamler, chair of family-owned Kent International, one of the largest U.S. bike manufacturers, warned that industry-wide prices could surge by up to 50% if the current tariff levels persist.
Approximately 90% of the 12.5 million bikes sold annually by US brands are imported, with the majority manufactured in China. Other significant producers include Taiwan, Vietnam, and Cambodia. The U.S. president announced new tariffs of 125% on China on Wednesday, having previously threatened heavy tariffs on other major Asian bike manufacturing nations.
The tariffs are hitting the U.S.’s $6 billion bike industry during a challenging period, with a sales boom during the pandemic now reversed and inflation driving up manufacturing costs. Kamler anticipates a further price increase of at least 25% due to the additional 34% tariff imposed by the US president last week.
Kent International, whose adult bikes range in price from $149.99 to $524.99, has already raised prices by 12% this year, following Trump’s initial 20% tariff on China. The company expects to sell 1.4 million bikes in the US this year, marking its worst performance in over a decade due to the tariffs.
Why It Matters: The recent tariff hike on China by President Trump has sparked a broad risk-on rally, catapulting major indices to multi-month highs and sending volatility plunging. However, the impact on the bike industry is severe, with prices set to rise significantly.
Furthermore, the tariff hike has been criticized by some, including Kevin O’Leary, known for his role on Shark Tank, who accused China of unfair practices, including intellectual property theft from American companies. This ongoing trade war and its impact on various industries, including the bike industry, is a matter of concern for both consumers and manufacturers.
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