Bicycle Production Up Slightly

by Gary Gardner

Bicycle production rose to 105 million units globally in 2004 (the last year with global data), a 1.5-percent increase over 2003.1 (See Figure 1.) The increase is actually a slowdown in production as firms draw down inventories that had grown during two years of rapid growth.

Although bicycles are produced in dozens of countries, the top five producers—China, India, the European Union, Taiwan, and Japan—are responsible for 87 percent of global production. 2 China is in a league of its own, however, with some 58 percent of the global market in 2004.3 (See Figure 2.)

Preliminary figures suggest that Chinese production increased by 11 percent in 2005.4 Given the relatively flat trajectories of other major producers, it is very possible that by 2006 China alone accounted for two thirds of global bicycle output.

The Chinese juggernaut faces obstacles, however, especially trade barriers imposed in Europe, Mexico, and Canada. Mexico’s 144-percent tariffs, first imposed in 1994 and renewed in 2005, have effectively shut Chinese bikes out of that country.5 And Europe’s 48.5-percent duties on Chinese bicycles, adopted in 2005, were expected to curb Chinese sales in Europe substantially.6 But China may be adapting to the restrictive European market, in part by setting up production facilities in Eastern Europe.7 Meanwhile, India is reducing tariffs on bicycles, an encouraging development for Chinese firms, especially in light of projections of a 33-percent increase in demand for bicycles there between 2006 and 2010.8

Production of electric bicycles—with electric motors that make longer and hillier rides possible with less exertion—continues to boom. Introduced in the mid-1990s, global sales rose to 12.1 million units by 2005.9 China accounted for as many as 11 million of these and is expected to remain the strongest engine of demand: Chinese consumers were expected to buy 15 million electric bikes in 2006.10 Meanwhile, electric models could receive a boost when new standards to be finalized in Europe make components of different producers compatible.11

Government support for bicycles—typically in response to concerns about climate change, traffic congestion, energy conservation, and fitness—is increasingly evident. Taiwan announced in 2006 a plan to build 2,600 kilometers of bicycle lanes over the next five years and to adopt bicycle-friendly traffic rules.12 In London, a congestion tax on autos produced a 50-percent increase in bike trips in the city, while use of the 16,000-kilometer-long National Cycle Network rose by 15 percent between 2004 and 2005.13

In Australia, the state of Victoria committed in 2006 to triple its funding of bikeways over the next decade.14 France created the position of “Monsieur Velo”—a Cycling Czar—whose chief responsibility is to increase biking rates, likely through promoting measures to increase cycling safety, provide more bicycle parking, and offer greater bike access to public transportation. 15 And in San Francisco, the city has set a goal of raising commuters’ bicycle use from 2 to 10 percent of trips by 2010.16

Achieving such a transformation in U.S. cities is a tall order. But a 2006 study found that the higher cycling rate in Canada—three times above that in the United States—could be traced to infrastructure differences rather than to weather or cultural differences.17 It found, for example, that cycling rates in the Yukon are twice as high as in Southern California and three times as high as in Florida.18 The authors concluded that cycling in the United States could be increased through changes in transport and land use policies.19 U.S. transportation legislation has increased funding for bicycling infrastructure from $150 million in 1992–97 to $900 million for 2005–09.20 But cycling’s share of transportation funding remains minuscule.21 (See Figure 3.)

Meanwhile, entrepreneurs continue to play a role in promoting cycling. A subscription bike rental service opened in Boston in 2006 that offers a year’s use of a 15-speed mountain bike for just $19.99.22 The bulk of the revenue for the service comes from advertising mounted on the bike frames, which costs companies about $100 a month for ads on four bikes.23

Includes the following charts and graphs
World Bicycle Production, 1950-2004
Top Five Bicycle Producers, 2000-2005
Share of U.S. Transportation Funding by Mode, 2005

Notes
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