Tariffs Lifted on Carbon Frames Under $600 Entering USA

Oct 29, 2019 at 10:08
by James Smurthwaite  
hero

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.


199 Comments

  • 139 4
 looking at that photo, i can hardly contain myself.
  • 81 4
 sorry, I didn't mean to barge in with my shitty puns
  • 61 5
 @rocky-mtn-gman: whatever floats your boat, man.
  • 51 6
 @JesseE: sorry - i've been having some frustrations lately, had to go to anchor management.
  • 20 3
 @rocky-mtn-gman: maybe some shore leave is in order?
  • 18 2
 Had to re-read it to let it sink.
  • 22 1
 There's a boatload of problems with this comment thread
  • 31 0
 @ratedgg13: I'm a freight so. It's not admiral-ble how we've steered it into the rocks.
  • 35 0
 maybe its you that needs a stern talking to.
  • 14 0
 @rocky-mtn-gman: you're making waves in the comments
  • 19 0
 I sea what you did there. I'll bow out now.
  • 17 0
 I've been on the prow for something new, but the current prices have my stomach in knots.
  • 9 0
 That’s a hull of a lot of containers to ship.
  • 7 0
 @nyhc00: this comment is starting to get alot of cargo on it now
  • 5 0
 Trying not to sound like Captain obvious, but I think this ship won't sail!
  • 2 1
 Im really not shore what to say about this
  • 4 0
 Some of these comments are going overboard.
  • 5 0
 Shouldn't have to get yaw bikes from China.
  • 9 16
flag CatholicPriest420 (Oct 31, 2019 at 22:03) (Below Threshold)
 @rocky-mtn-gman Quit fooling yourself, that picture is the quintessential image of both the mountain bike industry and late western human existence.

We've sacrificed future generations ability to prosper, let alone survive, for our own ecologically lazy and corrupt greedy intentions.

Welcome to the future!
  • 5 0
 @CatholicPriest420: ---This guy is in the drink.
  • 7 0
 @CatholicPriest420: jeez, these puns sailed right over your head
  • 3 0
 @CatholicPriest420: it’s hard to take this user name seriously.
  • 1 1
 I just pooped a boatload.
  • 2 0
 Man, this should end just aboat now.
  • 2 0
 So, Parlee buys this frames for $600 , then puts a fork and sells them for $4,300 !
  • 107 3
 for $600 you probably couldn't even get a yeti chainstay protector
  • 34 2
 So if the Tariff is for frames under $600 and they sell (with a fork) for $4300, that makes for a 616% markup on the frame (assuming $600 MSRP fork)! Bikes are expensive. . .
  • 26 0
 @whilgenb: The markup is horrendous, especially when you consider that the people who actually make the frame don't earn a lot.
  • 12 8
 @whilgenb: read again..

the 600$ frame exemption is different from the one being requested by Parlee
  • 6 0
 Lucky for Yeti, their frames are made in Vietnam
  • 1 2
 @whilgenb: pretty much every consumer good sees a 700% mark up by the time a customer buys it. From between manufacturers, brands, distributors, shops, so many levels.
  • 1 0
 @hamncheez: Anyone you know using these frames?
  • 16 11
 @cool3: buying carbon products from aliexpress, especially when it comes to road frames, forks and bars makes you a candidate for Darwin awards.
  • 4 0
 @WAKIdesigns: That's what I thought... Wink
  • 7 0
 @cool3: ...sorry, they all died in pothole crashes
  • 2 0
 @H3RESQ: LOL!
  • 9 6
 @cool3: some of the common rationalizations of folks buying these is that top frames are also made in China, probably in the same factory as these. Some aliexpress sellers support that reasoning saying how much they worked for Spec or Pinarello and the replica is just something they do in their own time.

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.
  • 5 1
 @whilgenb: imagine paying $4300 for a rigid frame
  • 10 1
 @cool3: I have a Chinese road frame. Had it for 5 years now maybe. $350 CDN. It is great. For that price I was willing to take the gamble on them not honoring a warranty issue, which I had none. Would get one again. I also have Chinese carbon rims as well. I built up the wheels myself. I guess I just like to live dangerously. I am sure there are scammers putting out garbage but there are also plenty of known companies with good reputations and decent product. Like anything do your research.
  • 1 0
 @cool3: yes, and no problems at all, but he's a 140 pound roadie so not much stress on the frame
  • 7 7
 @tubby1536: it is a gamble on your health first of all. I have personally seen wasted no-name bars and if you need any more proof, check out Raoul Luescher who repairs carbon frames. And heh, it is not limited to carbon. My friend bought some noname , shittyname alu cranks and bars in alu, I wouldn’t dare to try on parking lot. Then off course there are some weirdos making stuff in Germany that should hang on the display on the wall, not on the bike. they do all the testing, yet they still come up with products like handlebars weighing 110g for 800mm width.

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.
  • 1 0
 @WAKIdesigns: Just upvoted you on that one dude. You’re blunt at times but honest always. Not saying greed doesn’t exist in the bike industry it certainly does. But it’s better to have the backing of a name brand and the associated customer service/legal recourse than the greed associated with selling a carbon frame for under $300 with zero liability recourse.
  • 3 1
 @WAKIdesigns: You are not wrong. I gave up an upvote. There is some bad stuff out there and at the end of the day no matter how much you research you never really "know" who you are buying from.

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.
  • 4 0
 @nfontanella: I’m sure lots of guys have paid that to get something rigid.
  • 29 4
 This makes sense. If the goal of tariffs is to put American companies first—even if you disagree with the principle or the tariff strategy—it makes no sense to put tariffs on stuff American companies cannot produce. Yes, there are a few companies like Guerilla Gravity and Allied, but in general, the US cannot make large quantities of carbon frames. So, right on, this exemption is a win-win no matter how you slice it.
  • 5 1
 It might make sense to maintain current profitability, but then is cheap foreign labor ultimately stifling innovation for the ability to locally source manufacturing and materials?
  • 21 0
 What bothers me is that Guerrilla Gravity is making an affordable durable, Made-in-USA full suspension frame with modern geometry and people still dismiss it.
  • 6 2
 One of the main strategies is to try to get China to lower the tariffs that they have been putting on US companies for decades. It is still in the air if it will work, but trade with China should to be more fair and balanced. Right now it is trade is heavily slanted in favor of China.
  • 6 0
 @sissypants according to this Pinkbike article from 2018 the US doesn't have a problem producing carbon fiber. The problem isn't that the US can't produce it, it comes down most likely to labor and factory start up costs. The factories are already in place in China and the labor as we know is cheap. Until those tariffs cut into profits enough to make it worthwhile for manufacturing to move, there wont be a change to Made in the USA.

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
  • 10 2
 @westeast: Tariffs are bad. Tariff wars historically have never had the desired effect of boosting the economy of the country that they are supposed to be protecting. A little research on the topic goes a long way. I’m not saying that China doesn’t play dirty when it comes to state sponsored corporate espionage, theft of intellectual property etc. since they are a totalitarian state it is impossible to separate corporate policy from govt. policy in regards to China. However, everyone on the side of these tariffs is deluded if they think this will bring back American blue collar manufacturing work. Remember, please bear in mind that it was American corporate policy that agreed to china’s stated conditions for setting up shop there in the first place. Board room decisions were consciously made in favor of “sharing” intellectual property teaching advanced manufacturing methods etc. This was done because the people at the top felt it would enrich them despite all the negative effects. In other words the board room mentality was such that if you can get away with not paying workers at all... let’s do it. The labor was so cheap and the environmental regulations were so lax, that closing up shop moving everything overseas giving away manufacturing methods, then loading everything onto a cargo ship and sending it halfway around the world was viewed as a win for the board room members and big shareholders. All this was done to avoid paying the American worker and to avoid any and I mean any environmental liability for spewing whatever kind of crap waste products said manufacturing would cause. If you want American workers to work for a few dollars a day, be forced to sleep in the factories where they work, and have to wear a respirator mask to simply breathe in major metropolitan areas then great. Let’s turn ourselves into China so we can compete. The problem is corporate greed of American multinational companies, along with a legal structure that makes them beholden to public shareholders and short term gains as opposed to actually caring about the workers that helped build the company in the first place. For these same companies to now cry boo hoo about China stealing all their secrets...well they should’ve thought about that before they started rubbing their greedy little hands together in excitement at the prospect of nearly free (slave) labor and zero environmental regulations. The piper always gets paid. Tariffs simply exacerbate the problem. Not solve it.
  • 5 4
 No, the goal is to get China on a level playing field. While someone here gets their cheap parts to own several high end bikes and sip a $5 latte daily at Starbucks while bitching about what the latest frame cost them some poor person over there is working 12+ hrs a day 6 days a week just to get by hoping they might someday own a 30 yo Schwinn to ride.

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“ ...
  • 4 3
 @fattyheadshok: The woe is me, blame the man attitude is tiring and played out considering American have the highest ability [relative to most of the world] to make healthy consumer choices. The status quo is cheap, short-life span junk at the expense of the environment and others around the world. Lets buy dollar store plastic so every room can have a 65" flat screen. Lets swig corn syrup vs buying from the local farmer. Let's buy cheap ebay lights and mounts vs supporting companies like K-Edge. Toss it in the bin and purchase new vs repair and rebuild. You cannot continue to blame faceless corporations for your compatriots inability to separate the chaff from the wheat.
  • 3 0
 @fattyheadshok: Interesting take. I do somewhat agree with your point about the short term thinking of corporations. I think you should have also mentioned more about the labor costs. Excluding increased environmental costs her rein the US, there are plenty of other labor expenses that make moving business out of the country attractive. Rather than use tariffs, why not eliminate some of those barriers? There was a study that measured the economic freedom/business freedom of industrialized nations and the US was behind many European counties that are thought to have more regulations. .

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.
  • 5 0
 @motard5: I get it. Trust me I walk the walk as much as I can. I buy local, belong to a local grocery coop, buy from my local bike shop, etc. As far as repairing things goes... I restore vintage guitars for a living. I get the value of high end hand skills. But American corporate law is structured in such a way that a publicly held company can be sued for not pursuing the bottom line and being able to prove it. A company making a decision to support workers or the environment etc. needs to be able to show how this improves profitability or open themselves up to law suits. Their first legal obligation is to the shareholders. Not even to the actual products or whatever the company’s business is. What they make, or sell is in fact secondary to the bottom line shareholder stake. That’s an issue. Another issue is the fact that in America no one from the actual labor force ever sits on the board. This is exactly opposite to Germany where every major company has someone representing the employees in the board room. Makes for a less adversarial relationship between the company and its workers.
  • 5 0
 "American corporate law is structured in such a way that a publicly held company can be sued for not pursuing the bottom line and being able to prove it."

"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.
  • 2 0
 @fattyheadshok: If you live in California, California is charging taxes (9.25%) on all online out of state purchases (9.25%) that California consumers make. That is a state tariff. This California state tariff is obviously to make more money (759 million in first year) to fuel their big spending, but also to keep consumers buying in California. It is funny that California politicians and leftists criticize Trump for the tariffs, but are doing the same thing themselves. Lol.

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.
  • 1 0
 @tacklingdummy: That's not how trade works. The reason we buy more stuff from China than China buys from us (the USA) is that the standard of living in China is substantially lower and so the cost of manufacturing there and shipping here is cheaper. If you make it more expensive to ship from China, the Chinese aren't going to buy more from us, they're just going to get poorer. It might get more "fair and balanced" but only because everyone lost out.
  • 2 0
 @TheUnknownMTBR: The fact the tariffs are temporary is why the US manufacters aren't gearing up to try to replace the Chinese. Manufacturers are moving production to Taiwan or Malaysia or whatever. The process was never going to work from the beginning, it's a bad plan that needs to be completely abandoned immediately.

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?
  • 1 1
 @bigfinnrider: you took that seriously? And now you think it’s worthy to invest time discussing it with you?

This is a geo-political subject that goes way beyond a bike forum, tit for tat, pee-pee match. Good luck.
  • 1 1
 @bigfinnrider: I have spent a lot of time in China. US products in China are very expensive because of tariffs on end products and more expensive than in the US. The tariffs on US products are to pressure sales of US products in China and promote sales of their own Chinese products. Chinese products are extremely cheap there that very few Chinese want to buy US products. That is why Home Depot was not able to compete there. They were priced out of the market and closed up shop. China smothers or blocks a lot companies from doing business in China. Chinese government is very powerful and they definitely control who is allowed to thrive or not. Trump just wants to try to level the playing field more. Fair and balanced trade.

Any country that imports way more than it exports is going to severely pressure their economy.
  • 1 0
 This is hard. I'm one foot in and one foot out. My political like and dislikes aside I agree at least to an extent. You are right other companies have done it and kept it affordable. I have a GG Trail Pistol that will be here any day. It's an incredible value for the money and the frame is made in the United States in such an innovative way with so many new ideas and tech being put into it that I had to try it. Granted I was in the market for something new but I would much rather support an innovative American company that is pushing the limits of what smart engineering can do than buy something with an absurd mark up. That being said I can still see that the majority of the Industy has been in China for years and we do still need it and for it to stay affordable. I do believe that these tariffs will ultimately hurt the consumer and the industry as a whole.
  • 25 1
 You know who isn't charging ridiculous markup and makes their frames entirely here in the USA? Guerrilla Gravity. Know that your hard earned cash is going into the hands of a rad group of Coloradans, using technology to produce a progressive geometry, affordable, burly carbon frame that can be transformed into 4 different models with adjustable reach.
  • 13 0
 You're the man! Our frames are also environmentally friendly through our short supply chains, powder coating vs painting, and recyclable carbon materials.
  • 2 1
 I'd love to support American Made Carbon but sadly I have had soo many bad experiences with smaller bicycle outfits I am unlikely to try them. Sending a bike to Santa Cruz for replacement is just too easy. Looks cool though. Had never heard of them till now. In 3 years when I get another bike if they are still here I will give them a look.
  • 4 0
 @Cyberhatter: @GuerillaGravity isn't exactly new to the game. They made alloy bikes in the US for several years before switching over to carbon. Their bikes are definitely worth considering, but I do see your point about buying from a brand that's been around and has the means to fulfill warranties for years to come. For what it's worth, I bet GG will be around for a long time
  • 3 0
 Getting me a smash frameset this winter.
  • 1 0
 @GuerrillaGravity: I didn't know carbon fiber could be powder coated... and down the research and learning rabbit hole I go.
  • 2 0
 @MattyBoyR6: In case you had any doubts about the fact that they are doing stuff in house, here's the rundown on how they've developed Revved Carbon Technology: ridegg.com/thedispatch/revveddevelopmentpart1
  • 2 0
 Preach. I have a trail pistol that should be here any day. I love seeing a company here in the states that's pushing the boundaries of what good engineering and innovation can achieve.
  • 24 2
 So a Parlee frame has a cost under $600 and sells for 2k?
  • 4 2
 I had to google who they are. Holy crap! That is an insane mark up.
  • 17 6
 @jmhills: I posted this below as well. There's a crazy amount of markup in the bike business, but the manufacturer definitely doesn't make 500 points.

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.
  • 27 2
 How much do you think a can of Redbull costs to make?
  • 25 5
 @NoahColorado: not sure what the market rate is for fizzy caffeinated animal piss...
  • 4 1
 @brianpark: I get the chain effect but its a generic geo road bike with a house brand fork and usual Ultegra drivetrain. Not exactly bang for the buck there.
  • 4 0
 If you read the article on BRAIN it also calls out Trek's Project 1 program (read: expensive) asking for an exemption for frames both under and over $600. I feel sorry for the poor bastards who ended up with the sub-$600 frames with the same Project 1 sticker slapped on them as the nice ones.
  • 6 2
 @jmhills: If you think that's insane mark up, you aren't very well versed in capitalism. Anything you buy in a convenient store has much larger mark up, most clothing has much larger mark up (like $2 per shirt, that they sell for $30+), etc.
  • 5 5
 @brianpark: bikes shouldn't cost as much as a half-decent used car
  • 6 1
 @monkeybizz: What "should" they cost? And how do you arrive at that number?
  • 8 0
 @monkeybizz: I don’t disagree. You won’t get an argument from me that the bike industry is inefficient and bikes should cost less.
  • 5 0
 @igxqrrl: Whatever he can thinks they should cost, and Communism.
  • 2 0
 @brianpark:....well at least the bikes themselves are efficient.
  • 3 2
 When you add salaries, wages, benefits, taxes, light, heat, electricity, marketing, sponsored riders, teams, lease payments etc, etc, etc, etc... and yes some profit... then yes the frames sell for 2k.
  • 3 0
 @brianpark: That's just the cost of the the raw material... a basic frame. When you add salaries, wages, benefits, taxes, light, heat, electricity, marketing, sponsored riders, teams, lease payments etc, etc, etc, etc... and yes some profit... it makes a lot more cents.
  • 3 0
 @monkeybizz: Bikes cost what they do because people buy them. You can argue and research economics 101 all day. In the end, whether they should or should not sell for what they do, someone, lots of people, buy them. And when they want another bike in a couple years, and the bikes went up, they buy them again. If the demand is there, the cost is what the buying market will pay for said bike. The best way to get your monies worth in the expensive mountain bike market( just talking dollars/ value) , is buy direct sale bikes. Buy direct, save a alot of cash, spend cash in LBS for service/repairs, and gear, parts..everyone wins.
  • 2 0
 @igxqrrl: look at the rigs Commencal is making. Pretty sweet bang for your buck. Go pay for your overpriced yeti since you clearly don't care that much
  • 4 0
 @monkeybizz: bikes should cost exactly what they cost. Not saying I like the fact that I just paid $5k for a stupid piece of plastic. But I did. And people do everyday. That’s the market. And like everyone has stated, the bike touches dozens of hands before it touches yours. Everyone has to get paid. And we as consumers are willing to pay them. If we weren’t, they’d be out of business.
  • 1 0
 @jason475: People in Calgary don't care what they pay for their bikes here, they're helping drive up costs. I'm also not expecting to pay a lot less either just a reasonable price. Plus I fix all my stuff myself cause that's just cheaper and easy enough to do
  • 1 0
 @monkeybizz: I paid less for my carbon fiber yeti than most of the alloy commencals out there.
  • 1 0
 @igxqrrl: Are we talking new at MSRP + spec matching + year that you bought it? I'm genuinely curious or are you just part of industry discounts
  • 1 0
 @NoahColorado: Aluminum can: 25 cents/ Silk screen logo: 27 cents/ Himalayan goat piss: priceless !
  • 1 1
 @monkeybizz: I get it for sure. The prices are mindboggling. Its like I f*cking hate how out of wack from reality pro baseball, football, and basketball players salaries are, along with top tier actors. But lots of people are willing to go to a game, pay $25-30 for parking, have like a few $18 beers and $10 hot dogs, and buy a $100 team jersey. As long as the buyers buy....
  • 2 0
 @islandforlife: yeah your answer shud be highlighted.
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
  • 13 1
 So....in this current "climate change frenzy" let's do this:

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.
  • 11 0
 To be fair, tooling costs a lot more when you don't own your means of production. We're constantly investing in our own manufacturing capabilities. The road to producing our Revved Carbon frames was planned years in advance.
  • 5 0
 @GuerrillaGravity: But you prove that it can be done Smile Keep it up!!
  • 15 4
 Is no one else mad at the obvious 500-600% markup these companies are charging for frames?
  • 8 7
 There's a crazy amount of markup in the bike business, but the manufacturer definitely doesn't make 500 points. Unpainted carbon frames aren't quite the same thing as painted, assembled, with hardware, shock if it's a mountain bike, fork if it's a road bike, then sold to a distributor, then to a bike shop, then to a consumer.
  • 3 6
 maybe re-read the article again... there are multiple exemptions being discussed..
  • 9 0
 @brianpark: The absolute vast majority of frames arriving from overseas factories are painted. Most will finish the assembly in-house which consists of installing bearings, shock, and minor bits. The shock itself is purchased at peanuts on the dollar at OEM level pricing from the big guys.

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.
  • 6 1
 @gus6464: ~500% markup, but the reality is nobody is getting rich in the bike biz. It turns out it costs a lot of money to ship, QC, return some % for failed QC, prep those that pass QC, paint, build, ship again, deal with shipping breakage, deal with customer returns (valid and invalid), deal with warranty issues, etc...

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.
  • 2 0
 this is really over simplified. There are lots of salaries, healthcare, taxes etc that have to get paid for. Want to protect your brand with a warranty and good service some more salaries and cost. Want to have insurance to make sure you can't go to jail when you are sued - More cost. Advertising, teams, sponsorships it adds up fast and has to be covered. I saw a guy go down on a the road when his carbon chineese fork failed. I think the collarbone sergery more than made up that money. No thanks. I'll still with the Trek, Santa Cruz, Specializeds of the world even though minions of satan they be.
  • 1 0
 You would be even more mad if you would know the markup on "designer" clothes.

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.
  • 1 0
 @brianpark: but what you're saying? a frame on alibaba costs € 500, the big brands with the purchase volumes they have will pay € 150. Rest assured that profits are very high!
  • 1 0
 @Cyberhatter: yep cause name brands don't break at the exact same rate.
  • 8 0
 For all of you wondering what it costs to make a frame, I have never NEVER seen a mass-produced carbon frame that cost more than $600 to make. It just doesn’t happen. I’ve seen pricing for all kinds of models at the factory OEM level and it just doesn’t happen. Let me also kindly point out that outsourced Asian factory paint jobs are $50, and assembly of those small parts is negligible. This is why I believe in factory-direct sales. Not consumer-direct, factory-direct. Most brands use engineers at the factory, why not be your own brand and save that huge markup? It’s still a little shady out there, but we’ve seen improvements year over year and factories have really been stepping up there game with direct sales despite the language barrier, marketing issues, and prevailing stereotypes of IP theft and geometry cloning. There is real innovation going on in design at the factory level, we just never hear about it... because there aren’t huge markups to find Pinkbike articles.
  • 3 0
 Yep. Built myself a dentist build Chinese original.
  • 10 0
 Did we just become best friends?
  • 1 0
 I got my M06 for $580usd shipped, great xc frame.
  • 3 0
 @GuerrillaGravity: I am in awe at what you guys are doing. Make no mistake.
  • 9 2
 If you don't understand the operations, supply chain, marketing, R&D, or financial aspects that go into business.... Then maybe just shut up. They charge ridiculous markups because they have to, and because they can. Let me help educate....

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.
  • 1 0
 Yes because companies don't pad the balance sheet to look like they are profiting less than what they really are...
  • 2 0
 Thanks for educating us, but you’re off by a factor of a THOUSAND! Maybe read your own link if you’re going to quote it.
  • 1 0
 Something seemed off about this and yep, you might want to add 3 zeros to each one of those lines.
  • 2 0
 Significant figures aside, I came to make the same point. A lot of people also have to get paid between the wholesale contract manufacturer and the consumer. The markup is ~100% just between the the brand and bike shop (part of the reason for the surge in direct sales). But bike shop owners and staff ain't exactly raking it in.
  • 1 1
 Yeah but this is Giant, I mean they haven't even updated the Glory since it was released, maybe if they made bikes that people want things above would be different. How would the balance sheet at Santa Cruz look?
  • 10 1
 So every carbon frame under $600. So you mean ever carbon frame.
  • 8 1
 yeup. crazy how much the mark up is. I understand that it takes more money and time to assemble, paint, etc. but not $3000 worth of time. Something gotta give with they high prices. but supply and demand...
  • 8 3
 @stumphumper92: With all that crazy profit you'd think someone would start a bike company that does it for less! And it happens, and they go broke because it turns out the markup isn't crazy, it's the reality of running a business. Stuff costs money.
  • 7 0
 @igxqrrl: Not sure why a lot of consumers defend the high prices lol do you like to pay more or are you just trying to justify the large hole you have put in your pocket?
  • 1 0
 @stumphumper92:
Can’t you tell he’s involved in the industry and benefiting in some way?
  • 2 1
 IMO if you take enjoyment out of watching the videos on this site, World Cup racers, rampage or slope style competitors than the price of bikes is justified. The markup isn’t that high because that is the cost of raw material and frame production, not taking shipping, athlete salaries, employees and the countless other expenses into account. There are some people for sure that don’t care about any of that and that’s cool but I like to see people do inspiring shit and if that means I can afford a bike every 4 years instead of every year it’s worth it to me.
Tl:dr if you’re on this site then bike cost is justified @stumphumper92:
  • 1 0
 @igxqrrl: People get scared when it's inexpensive they think there getting something of low quality. Klien couldn't sell bikes until they jacked the price up way beyond reasonable. Companies quit making single pivots as a less expensive option because no one would buy what they perceived as cheap inferior design. (Evil had to add two dozen bearings to their single pivot to make it sell able) Rich white guy sports = expensive. It's our own fault bikes cost so much. We just want to pay more and will defend our right to do so, So GG when the sales go down just jack up the price.
  • 1 0
 @tooladdict: Couldn't agree more. I bought a Vitus this past year. Quality build for 2k that typically would go for 3k+ with the big name brands. Just as good as the competing brands and even better than some. But they won't sell as much as you said, since they lack the boutique price point and people tend to be skeptical when bikes are affordable.
  • 8 0
 how much do you think it would cost to ship my pants?
  • 7 0
 i just shipped ma drawers!
  • 4 0
 @laxguy: right here in the store ?
  • 3 0
 I can't wait to ship my pants, Dad!
  • 6 0
 Buy aluminum from Taiwan , democracy , better wages , recyclable into frames again and again
  • 6 0
 In other words, all carbon frames
  • 4 0
 So the industry saves 25% on something they mark-up to a level that makes the Tariff savings statistically insignificant… EXCELLENT NEWS!!!
  • 2 0
 Know who won't see the price reduction after the reduced tariff? The customer! The media won b/c it riled up their base against the US government, and the bike industry was supportive of their reporting b/c they knew they'd win in the end. And heres the end result. The beginning of reduced tariffs without the requirement to decrease their MSRP they claimed was necessary to cover the xx% tariff increase. Such BS.
  • 4 1
 The funniest part is that there will still be the fools trying to defend the $7k price on bikes that were ultimately like $1,200-$1,500 in parts.
  • 1 0
 Giant bikes have always had a China and a Taiwan factory. I saw in the news that giant pulled out of China for 80% of what they did. I have had a few tranches and they were great now if I can just get the cash for a alu reign 29
  • 3 0
 OK so people who self import chinese carbon frames are good to go. Sorry everybody else.
  • 8 5
 What's a 'Traiff'? Is it like a Tariff but a street version?
  • 6 0
 Exactly - what is a spellcheck?
  • 2 0
 Any relief on aluminum frames or this is only for dentists.
  • 5 0
 @siobhananon: I’m usnure
  • 3 1
 Ahhh they fixed the title. Now I look stupid and deserve the negative props.
  • 1 3
 @jorgeposada: only hand relief, but that costs extra, I double checked with my 'masseuse'
  • 1 0
 @rjwspeedjunkie: That's ok, I have more bikes than know what to do with right now.
  • 3 0
 so until then, i'll stick with my alu kona (pictured in this article)
  • 5 0
 The one carrying all the containers?
  • 1 0
 If everyone only knew what the OEM price is on a Fox 36 GRIP2. Also SRAM pricing on NX at the OEM level is barely over the cost of the raw materials to make the thing.
  • 1 0
 Numbers?
  • 2 0
 Article about tariffs on carbon frames. And the picture shows a huge boat shipping china.
  • 7 9
 These tariffs are terrible. The profitability and employment of US workers relies on the means of production being done abroad. Cost of living in the United States is too high (recently and directly as a result of these tariffs) to believe that manufacturing jobs would be viable here, not to mention the environmental regulations for manufacturing that keep costs high here. We have all time low unemployment. What is the point of this?
  • 1 0
 That's going to be driving some quality and enviro legacy in the industry and country for the indeterminate future.
  • 2 0
 So walmart carbon gets a break.... hmm
  • 2 0
 Profit margin goes up for your LBS, we won't save a dime
  • 1 0
 So is this $600 to the bike company or rrp? Makes you wonder what our bikes are really worth Big Grin
  • 1 2
 OK so a $4299 frame and fork cost $600 or less to manufacture. Thanks again bike industry for absolutely screwing us consumers with your overpriced and most of the time poor performing products.
  • 1 0
 Please don't buy a carbon frame for less than $600.
  • 1 1
 Mine is excellent.
  • 1 0
 @JohanG: I'm sure it's fine, I'm just concerned with the conditions and practices to produce it that cheaply.
  • 2 0
 MY BIKE IS ON THERE.
  • 1 1
 Are frames from Taiwan exempt?
  • 2 1
 Frames from Taiwan have always been exempt from tariffs.

Taiwan != China.
  • 1 0
 @raybao: Good to hear.
  • 4 0
 @raybao: Taiwan does not = China . They have a democracy there.
  • 1 0
 @DGWW: Yes I know but the US officially supports the "One China" policy, which says Taiwan is a part of China. This is why I asked.
  • 1 0
 @jawzzy3: I wouldn't call parading warships through the Taiwan straight , and selling weapons systems worth billions to Taiwan "officially supporting" .
  • 2 0
 @raybao: Taiwan is most definitely not China - although many factories in China are owned by Taiwanese people and vice versa

or does "!=" mean not equal?
  • 1 0
 @DGWW: Not getting into the specifics. The US' official position is that Taiwan is a part of China (One China policy). Their actions are clearly not inline with their official position.
  • 1 3
 Carbon bikes suck anyways. I prefer a aluminum frame any day.
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