Stephen Frothingham broke the story
that US President Donald Trump approved tariffs on another $200 billion dollars worth of Chinese imports. Tariffs take effect this coming Monday, September 27, beginning at ten percent and increasing to 25 percent January 1, 2019. Bicycles and components make up half of the affected goods - a billion dollars worth of imports - much of which has already been paid for, but is still traveling on container ships, headed for bike brands that will now have to cough up ten percent more cash to US Customs before they can receive their goods.
The news came as Interbike, the largest US cycling expo, opened its doors to North American bicycle retailers in its new venue in Reno, Nevada. Timing could not have been worse. A number of industry organizations went to bat against tariffs during Congressional hearings on the subject, but their gains were minimal. Reportedly, "The U.S. Trade Representative said safety products, including bicycle helmets and bike lights, were among the 297 product categories removed from the list of proposed tariffs." Chinese e-bikes and motors have already been dinged for 25 percent, now bicycle, frames and components will fall under the ax.
I covered the conflict
in detail when the additional tariffs were first proposed. Now that they are a reality, the burning question is, "How will the new taxes affect my next bike purchase?"
What Does it Mean for Customers?
For a while, not much. Not all brands will be affected, and even the ones that are may not suffer nearly as much as many propose. Truth be told, the bike industry is infamous for making poor business decisions and has rebounded from much larger, self-inflicted losses.
Most bike makers can eat ten percent for one or two business quarters, but come Spring 2019, we should expect a building wave of announcements as bike companies attempt to break the bad news
as softly as possible. Beyond higher retail prices for many bicycles and products, however, the effects of the tariffs on the health of the sport and the future of its retail business are mostly speculation at this point.