TARIFFS AND SAFETY STANDARDS IN FLUX, AND THE DANGERS OF FALSE HOPE

12-23-24: “UL Safety Standards Legislation Cut From Government Funding Bill.” Bicycle Retailer and Industry News: “After initially being included in the government funding bill, the Setting Consumer Standards for Lithium-Ion Batteries Act was removed as Congress reached a compromise in time to prevent a government shutdown. The legislation by Rep. Ritchie Torres (D-N.Y.) would have given the Consumer Product Safety Commission authority to adopt mandatory UL safety standards. President Joe Biden signed the funding bill Saturday. President-elect Donald Trump and Elon Musk rallied Congress against the bipartisan deal after the draft budget resolution was released on Tuesday. In a tweet on Thursday, Torres said it would not be included after all in the package that funds the government through March 14 and includes $100 billion in disaster aid. BRAIN has reached out Monday to Torres' office for additional comment. The response: ‘House Republicans removed my lithium-ion battery fire safety legislation from their funding bill, alongside crucial programs like SNAP protections and child cancer research. All in the name of fiscal responsibility. Just for it to lose dozens of Republican votes and fail decisively. Ridiculous.’ The UL testing standards in the legislation are 2849 (e-bike electrical system), 2271 (lithium-ion battery), and 2272 (other powered mobility devices, including e-scooters). Absent, though, are the EN 15194 testing standard and three additional UL 2849 battery safety standards that industry members have proposed to be included. A statement from PeopleForBikes noted: ‘PeopleForBikes is relieved that the budget bill passed by Congress and signed by the president did not contain a last-minute amendment that would have substantially altered H.R. 1797, the Setting Consumer Standards for Lithium-Ion Batteries Act, as passed earlier this year by the House. That amendment would have directed the CPSC to adopt unreasonably narrow safety standards for electric bicycles and replacement batteries on an accelerated time frame. PeopleForBikes looks forward to working with the CPSC in 2025 on expected regulatory safety standards for batteries and e-mobility devices, which we have supported and advocated for at the state and federal levels for the past two years.’ Caron Whitaker, The League of American Bicyclists' deputy executive director, told BRAIN in an email that while the bill wasn't perfect, having no battery regulation is concerning. ‘While the language wasn’t perfect, there may have been some wiggle room in the regulatory process. Having no regulation on lithium-ion batteries is also a problem,’ Whitaker said. ‘We've heard from mayors that their fear of battery fires is leading them to want to regulate e-bikes at the local level, which could result in a patchwork of inconsistent regulation,’ said Whitaker. ‘If President-Elect Trump is true to his word and signs an executive order requiring no new regulations without the removal of an existing regulation, we could be waiting a long time to regulate these batteries. That will allow cheap, untested, and potentially dangerous batteries to continue entering the U.S. market.’” HPS Analysis: The lack of enthusiastic support from the American bicycle industry for this legislation that would have established the highest safety standards for e-bikes, UL 2271 and UL 2849, as mandatory federal standards under the Consumer Product Safety Commission, is not only disappointing but also deeply troubling relative to the future. Bicycles, inclusive of e-bikes, and bicycling facilities are under multiple attacks by the public for the first time in my memory. Instead of standing firmly on a safety-first platform, the bicycle industry association is advocating for what is the easiest for brands and manufacturers to comply with. This includes allowing compliance with the lower European standard, EN 15194 as being equal to the UL standards. As Whitaker noted above, ‘… that while the bill wasn't perfect, having no battery regulation is concerning.’ What we are faced with now, as she also said: ‘…will allow cheap, untested, and potentially dangerous batteries to continue entering the U.S. market.’”  

12-30-24: “Phoebe Liu Promoted to Giant Group CEO as Bonnie Tu Retires.” Bicycle Retailer and Industry News: “Giant Group announced its current chairperson, Bonnie Tu, will retire from her position, with current CEO Young Liu appointed as the new chairman, and current Chief Branding Officer Phoebe Liu promoted to CEO. These changes will take effect January 1. Tu, who will continue as a board member, has been with the company for more than three decades. As CFO, she led Giant's IPO in 1994. In 2008, she founded Liv, the group's female-specific cycling brand. She was named Chairperson in 2017 and led the effort to establish factories in Hungary and Vietnam. ‘As a publicly listed company, the rejuvenation, sustainable development, and succession planning of Giant Group have always been my top priorities,’ said Tu. ‘While working on my personal memoirs this year, I formulated the plan to retire. It is my sincere hope that the new management team will bring fresh perspectives and renewed energy to the company. I have complete confidence in the newly appointed leadership team to steer Giant Group towards a prosperous future!’ Young Liu, the new Chairman of Giant Group, joined the company in 1990 and moved to lead Giant's China operations in 1992. He returned to Giant's global headquarters in Taiwan in 1998 and assumed responsibility for global branded operations and product developments. Since 2002, he has served as general manager of Giant Taiwan. Since his appointment as CEO in 2017, Liu has overseen Giant Group's global sales and operational development. Most recently, he has been instrumental in establishing the Bicycling Alliance for Sustainability (BAS). Newly appointed CEO Phoebe Liu joined Giant Group in 2005, initially serving as export sales manager at the Kunshan Factory in China. From 2010, she served as executive assistant to then-Giant China President Young Liu, facilitating the coordination of production and sales in the Chinese factories. In 2015, Liu went back to Giant Group's global headquarters to oversee worldwide point-of-sale (POS) operations. Since 2017, she has held the dual role of chief branding officer and head of global gear business.” HPS Analysis: This is the third generation of family leadership that I and my HPS partner and senior advisor have known. While I did business with King Liu and later worked for Tony Lo, I was very aware of and had almost daily communication with Bonnie Tu in the role she had then as Giant Group's Chief Financial Officer. Steve Bina, HPS Senior Advisor, worked for me at Giant USA, and he prepared the reports and communications for Bonnie Tu and her resident financial representative Lanty Chang. Ms Tu’s nickname in the executive office at Giant USA was the dragon lady, To say she was formidable is an understatement. My point is that Giant Group has had strong and very effective hands-on senior management from the beginning, and I believe that quality of leadership will continue to this third generation. As such, HPS openly challenges the Giant Group to investigate very seriously investing in manufacturing bicycles and e-bikes in the United States or some combination of near-shoring as we enter this new era. 

01-01-25: “Through the Grapevine.” Bicycle Retailer and Industry News, by Marc Sani: “SPEAKING OF BAD PR: A recent opinion piece in The Washington Post raised hackles within the cycling community with Marc Fisher’s column: 'The truth about bike lanes: They’re not about bikes.' His central thesis is that in Washington, D.C. and other cities’, bike lanes ‘…are often installed to satisfy the barely measurable trickle of residents who pedal to work but mainly to make car traffic worse enough that people will be discouraged from driving.’ The phrase used by Fisher and others is ‘road diet’ [meaning] ‘build bike lanes and put the squeeze on traffic.’ New York City has been battling with this issue for years. In mid-November, Faith United Church hosted a meeting in D.C.’s Michigan Park neighborhood to fight the potential of a new bike lane that would run past the church. Filling pews with folks fighting bike lanes is truly bad PR. Still, D.C. has built some 100 miles of lanes over the past 25 years, making it a bicycle-friendly community where Capital Bikeshare sets new ridership totals every month. Still, this issue is complex – tinged by race, class and wealth. Longtime residents are ticked off. They see new bike lanes as ‘amenities’ for wealthy transplants moving into their neighborhoods. They have a point. Gentrification – whether good or bad – puts people in pews who view commuting by bicycle as an attack on their values. Keep reading.” HPS Analysis: Ever since I first read this column I have been haunted by his introduction to UP AGAINST THE WALL, “What’s buffeting the industry today is unique to this time and place in the 21^st century.” If you haven’t already, I urge you to go to page 30 of the January 2025 print issue of BRAIN and read the whole article If you don’t have the patience or time to read the whole column, read “UP AGAINST THE WALL” and “SPEAKING OF BAD PR.” Our industry and its trade association have a tendency to avoid inconvenient truths, and accordingly, fail to act on them. As the end result, we also tend to support the path of least resistance that allows the smallest amount of regulation and minimum standards. I went to work in a bike shop in St. Paul, Minnesota in 1956 and started working for Arnold, Schwinn & Company in January 1966. I have experienced first-hand or witnessed every change and era of the American bicycle industry and business over the last 68 years. I am troubled by what we do not know, but are willing to speculate about, including the changing American consumer. What Sani points out is what we don’t know and don’t understand about what the changes and shifts in the body politic mean to perceptions of products and shopping and purchasing habits. 

01-03-2025: “2024 A Year of False Hope in the Bicycle Industry.” Bike europe: “In late 2023, after a difficult year, industry insiders were looking hopefully towards the new year. However, predictions of inventory level recovery and stability in the market were pushed back at every contact moment during 2024; from Taipei Cycle at the beginning of the year, to Taichung Bike Week at the end. This 'hope' was abandoned in the second half of the year as insolvencies and closures began to dominate the headlines. As hopes now push forward to those that have 'survived to 2025,' here, is a perhaps unwelcome look back at 2024. January 2024 already began with unsettling news from Accell Group. The Dutch manufacturer announced that it would close one of its manufacturing facilities in the Netherlands to ‘simplify operations and enhance efficiency.’ It became clear that financially-troubled Accell Group was facing the task of reducing its €1.2 billion debt. The previously announced factory closure for Ghost in Germany and a logistically difficult and expensive recall of Babboe cargo bikes added to the problems. However, a white smoke moment came in October when Accell announced that it had reached an agreement with its financial stakeholders to reduce this debt by €600 million and other measures to improve its financial position. … Accell was not the only manufacturer announcing factory closures in 2024. In November, Pon announced that it had decided to relocate the European production of Santa Cruz & Cervélo to the existing facility of Pon Bike in Emstek, Germany for reasons of efficiency. Perhaps the biggest shock was that quintessentially Swiss brand, Flyer, was going to move production away from Switzerland as owners ZEG reorganised the brand again. The factory closure was described as a future-proof positioning in view of the changing market situation. As the year progressed, a flurry of insolvencies, chapter 11’s and bankruptcies, made the headlines as uncertainties grew. In the Netherlands many once-pioneering e-bike brands filed for bankruptcy including Stella, Qwic and Amslod – the former two already under new ownership. Austria’s second-largest bicycle manufacturer, Simplon, needed an undisclosed capital injection by a new investor to secure its future. This didn’t come for compatriot manufacturer, WSF, which despite big ambitions was liquidated in July when a restructuring plan failed. In Germany, manufacturer Advanced Bikes filed for insolvency in November noting, ‘The current situation in the market, characterised by full warehouses at our customers and also at ours, has made it impossible to carry on as before economically ... What kind of year will 2025 be? With 2023 considered as a ‘difficult year’ and 2024 more of a ‘challenging year,’ the open question is how will 2025 become to be labeled,  the ‘consolidation year,’ ‘make or break year,’ or perhaps more optimistically the ‘turnaround year’… let’s hope for the latter.” HPS Analysis: I have said many times that the American bicycle market is not the European bicycle market and that we should be careful not to confuse the two. While I haven’t changed my position, I do think there is value in the candor of the European trade press and the honesty with which it presents the facts about profit, loss, insolvency, and bankruptcy. I am sure that some of this when compared to the relative lack of same on the part of the American trade press is the ready availability of information and the dearth of transparency on the part of the American brands and manufacturers, most of which are private and have no legal obligation to disclose operating statements or financials before insolvency is imminent. “2024 a year of false hope in the bicycle industry” says a lot about the expectations of the bicycle industry in Europe, and this article says a lot about the integrity of the European trade press in reporting the facts. The gap between the respective industries on either side of the Atlantic does however contribute to the confusion about the real state and condition of the global bicycle business and its multi-national global players. 

01-06-25: “Accell Group Says its Recovery On Track Following 390 Million Euro Loss.” Bicycle Retailer and Industry News: “Following a recapitalization agreement in October and a 390 million euro loss in 2023, Accell Group's CEO said the company's recovery is on the way. ‘2024 was a challenging year for both the bike industry and Accell,’ said CEO Tjeerd Jegen in a business update. ‘However, our recovery is well on track across the business. We've normalized stock levels, made significant progress with our recapitalization, and are proud to see one of the key Accell brands, Lapierre, return to the UCI World Tour. Also, the Babboe recall is nearing completion, with the launch of new models expected by mid-2025. As we look ahead, we are well positioned to benefit from the favorable macro trends and continue building on this momentum in the new year.’ Accell recently released audited annual financial results showing a revenue decline of about 10 percent to 1,294 million euros ($1.34 billion). Not excluding write-offs, the company recorded a 390 million euro loss. With write-offs totaling 344 million euros, the earnings were 12 million euros, down from 140 million euros in 2022. The write-offs include charges for obsolete stock, restructuring costs resulting from the integration of Raleigh UK, Ghost and Velosophy, and a global recall of Babboe cargo bikes due to frame failures. The company said, ‘During 2024, the industry downturn continued. The market still faced high inventories at both manufacturers and dealers, while global economic factors impacted demand. The consequence of this was significant discounting, ultimately leading to another year of decline. To weather the difficult market conditions, Accell has further streamlined its organization, transforming into an integrated player. By leveraging its strong manufacturing footprint and reducing operational complexity, the company is better positioned to drive efficiency and deliver value. Additionally, a continuous savings program was started, aimed at enhancing structural competitiveness. The company said its recapitalization program is entering a new stage that includes a meeting of the senior lenders to vote on the plan and a court hearing to sanction the plan, both scheduled for this month.  It also said all its bike brands now benefit from joint stock management, and the stock levels of finished bikes, which peaked at the end of 2023, have now been brought back to normalized pre-COVID levels. Accell's inventory of finished bikes has declined from 340,000 in November 2023 to 169,000 in November 2024. Accell's brands include Haibike, Winora, Ghost, Batavus, Koga, Lapierre, Raleigh, Sparta, Babboe, and Carqon. Lapierre is returning to the UCI World Tour this season as the official bike sponsor for Team Picnic PostNL. The team will also use some accessories from XLC, Accell's P&A brand. A meeting of the senior lenders to vote on the plan and a court hearing to sanction the plan, are both scheduled for this month.  It also said all its bike brands now benefit from joint stock management, and the stock levels of finished bikes, which peaked at the end of 2023, have now been brought back to normalized pre-COVID levels.” HPS Analysis: While Accell withdrew from the American market in 2019, it had been losing money in North America for some time before officially picking up and departing. Accell and its stable of brands was one of the HPS favorites in pointing out that the European approach to marketing, particularly through bike shops, was not going to work in the American market. The false bike boom that followed from 2020-2022 did further harm to Accell Group’s financial structure centered on work in process and finished goods inventories. It appeared to HPS that without the continuing financial support of KKR, the investment firm that acquired Accell Group in January 2022, and took it private, that it would have declared insolvency in 2024. As this article points out, Accell Group owns and manufactures 10 European bicycle brands as well as several accessory brands and a wholesale distribution company. Accell Group recently announced that its upper-end Lapierre brand was returning to Grand Tour sponsorship, something that HPS believes is only financially possible because of KKR’s deep pockets. There is no other OEM multinational currently engaged in North America that possesses Accell Group’s breadth of brands and manufacturing base, and while chances of a return to this market are slim to none, carefully watching the financial condition of one of, if not the, largest bicycle brand players in the European market will yield valuable strategic guidance going into the uncertainties of the future.  

01-06-25: “The Challenge for Made-in-America Bikes? Made-in-China Parts.” The Wall Street Journal: “Two and a half years after Guardian Bikes opened a factory in Indiana, it tries to find components manufactured in the U.S. In 2022, Brian Riley opened a bicycle factory in Seymour, Ind., shifting production of his Guardian Bikes brand to the U.S. from China. The problem for him now: that nearly all the parts still come from China. Riley had aspirations to use American-made components before the November presidential election of Donald Trump, who has pledged to enact steep tariffs on imports from China. Riley, founder and chief executive of the children’s bike maker, hopes these tariffs will help him shift to U.S. components faster by making American-made bikes and parts more competitive against Chinese-made ones. But it is still a tall order. Chinese manufacturers have dominated the bicycle supply chain for decades. Almost all of the bicycles sold in the U.S. are imported, and most of those are made in China or assembled from Chinese parts, according to industry estimates and trade data. A typical bicycle is made of 30 to 40 parts, most of them from different Chinese manufacturers. For now, components from China represent about 90 percent of the total cost of Guardian’s parts. By the end of next year, Riley hopes that figure will be about 20 percent. Guardian is starting production of its own bike frames, and is working to source parts such as grips and reflectors stateside. As a result of Guardian’s new manufacturing, American-made parts could represent about 60 percent of the cost. Riley moved his production to the U.S. because he wanted to build a safer bike that could prevent the kind of head-over-heels braking accident that had injured his grandfather years earlier. Many bikes sold at retailers such as Walmart or Target aren’t fully assembled when they are shipped to retailers from overseas, so manufacturers don’t have oversight on the final assembly. ‘By controlling every aspect of production, we can guarantee the quality of every bike that rolls off our assembly line,’ he said. Guardian prices its children’s bikes between $149 and $399. That puts the company’s direct-to-consumer bikes at a price point between mass-market brands and more premium ones sold at bike shops. The factory’s staff can assemble up to 2,700 bikes a day. Brian Riley helped design a bike brake system intended to prevent head-over-heels accidents. Moving production to the U.S. isn’t a viable option for all bike companies. After Trump increased tariffs on Chinese imports in 2018, premium children’s bike maker Prevelo Bikes moved its production to Taiwan. It has since expanded production to Thailand and Cambodia. Prevelo’s bikes range in price from $240 to $1,400. The factories it uses are highly specialized with expensive machinery, said Prevelo CEO Jacob Rheuban. ‘I am not in the position to build those factories here,’ said Rheuban. ‘If we are looking to reshore, we need a larger movement on behalf of the entire industry.’ Even if Prevelo assembled bikes here, it would still be building them using foreign components subject to tariffs, Rheuban said. Larger manufacturers also have shifted production in response to U.S. tariffs on China. Taiwanese bike company Giant Group, which makes about four million bikes a year, recently opened a factory in Vietnam because the U.S. imposes lower tariffs on imports from that country, a Giant spokesperson said. The Vietnam factory currently has a production capacity of 100,000 bikes a year. Giant also has facilities in China and Europe. HPS Analysis: Guardian Bikes (www.guardianbikes.com) is a niche DTC brand that specializes in 26-inch wheel and smaller children’s bikes, with hand brakes as a patented feature. In 2022, at the height of what HPS now labels the “false bike boom,” the owner of Guardian, Brian Riley, opened a bicycle factory in Seymour, Indiana and reshored production to the U.S. from China. At the time the bicycle industry paid little or no attention, and while the move was covered in the trade press it didn’t ignite a wave of reshoring chatter in the trade, but this was 2022 when the remaining believers in JIT were scoffed at and there was still the euphoric belief that we were experiencing an ongoing bike boom. The euphoria didn’t last long as it was overcome and smothered by the reality of out-of-control JIC buying and the resulting work in process and finished goods inventory imbalance and glut. As the global bicycle supply chain went into seizures it impacted domestic assembly and manufacturing that is still experiencing financial disruption as the article about Accell Group and this article about Guardian show. While there are most certainly big differences in scale, the issue of making a profit as an assembler or manufacturer of bicycles is like every good and worthwhile thing. and is on the razor’s edge of danger. So is any effort to assemble or manufacture in America, absent an effective cluster of component manufacturers either in country or close by. HPS advises Guardian to reach out to Arnold Kamler at Kent International, if he hasn’t already, about a potential collaboration with Kent’s Bicycle Corporation of America assembly facility in Manning, S.C.      

01-07-25: “How Can Leaders Build Resilience to Changing Tariffs?” McKinsey & Company: “For business leaders around the globe, geopolitics are shifting rapidly. The short-term future of trade policy is uncertain in all three of the world’s largest exporters—China, Germany, and the United States—which collectively account for $7 trillion of exports. What’s more, in recent decades there has been significant fluctuation regarding what goods are subject to tariffs as lists are updated, revised, and renegotiated. In situations of ambiguity, leaders may find greater success by developing strategic and risk-based options rather than defaulting to reactionary responses. Companies should factor in uncertainty regarding implementation timelines, since timing may be driven by not only foreign policy negotiations but also the mechanics of the regulatory regimes (and judicial reviews) that underpin tariffs. The recent U.S. tariffs on steel and Chinese imports followed year-long investigations that were announced in April 2017 and August 2017, respectively. Next, CEOs should seek to understand the implications of tariffs for their industries, supply lines, customers, and investments. These exercises can help identify strategic opportunities to create value, such as shifting commercial markets of focus, capital allocation, pricing strategies, and manufacturing bases. As part of a comprehensive analysis aimed at value creation, companies can take the following steps:

• Assess comprehensive supply chain vulnerability. This analysis should go beyond the surface level to understand first-, second-, and third-tier suppliers’ exposure to potential tariffs and retaliatory tariffs. Firms can examine the complexity and geography of each step in their manufacturing process—mapping goods’ countries of origin and total landed costs—to estimate the potential effects of tariffs. Scenario planning can cover potential impacts on both production and delivery, such as disruption of critical inputs, changes in cost, and whether manufacturers can absorb added costs. In addition to supply chain updates, leaders may ultimately consider shifts in product mix. Scenario planning can also include potential retaliatory tariffs.
• Explore alternate supply sources. Mapping out supply chains and assessing the feasibility and costs of switching suppliers can help inform leaders’ decisions on tariff responses. Some potential new markets may offer incentives to defray switching costs, which will be important factors in cost analyses. Understanding available subsidies (for example, India’s “Make in India” initiative), eligibility for investment incentives, and the ease of doing business in other countries can help CEOs decide whether a new supplier will be viable for their business.
• Evaluate potential demand shifts. Leaders can analyze how tariffs will affect consumers across their markets to determine whether new strategies are needed. This analysis can consider changes to market access; anticipate demand shifts in the short, medium, and long term; and assess the potential for higher operating expenses. Relevant analyses would cover whether suppliers can absorb some of the tariffs to stay competitive and how much costs might rise from reorganized supply routes. Leaders can also assess elasticity of consumer demand to help understand market impacts of cost increases.
• Update market scans. Leaders can review supplier exposure for all the major players in their markets to better understand how tariffs may affect their competitors. If leaders evaluate these potential market shifts in advance, they could be better positioned to quickly seize unique opportunities and emerge stronger.
• Validate shifts in strategy. Tariff policy is difficult to predict, and shifts may be temporary. Hence, any strategy shifts made in response to tariffs should be grounded in rigorous analysis that supports long-term value potential and that can hold up to further shifts in trade policy.

Based on this analysis—and by rebalancing portfolios, revising operating footprints, and optimizing supply chains, talent practices, and technology and data stacks—leaders can prepare to seize the opportunities presented by global rebalancing.” HPS Analysis: On January 9, the NBDA presented its Quarterly Panel on Growing Ridership and Retail Foot Traffic. The lead speaker was Bob Margevicius, Executive Vice President of Specialized and the U.S. Trade Advisor to the Commerce Department, and the United States Trade Representative (USTR). Bob disclosed some “Little Known Facts,” including a chart that he submitted to the USTR when the subject of imposing Section 301 tariffs on children’s bicycles imported from China was first introduced. The chart, which can be viewed here (a link to the complete NBDA Panel). Bob explained that while he advised the USTR to look at both the bicycle units and the FOB value of the units as presented in the chart, the USTR focused exclusively on the FOB value. While 88 percent of the bicycle units imported into the U.S. originated in China, 35 percent of the total FOB value of the bicycle units imported into the U.S. was from China. The USTR interpreted this to mean that 65 percent of the value of bicycle imports into the U.S. had shifted to Taiwan, Vietnam, Cambodia, and source countries other than China. The rest, as they say, is history and the Trump Administration imposed the sweeping Section 301 punitive tariffs on pedal bicycles and e-bikes imported from China, and the Biden Administration eventually kept the Section 301 punitive tariffs in place. This disclosure from Bob underscores his advice, that HPS supports, that both units and value have to be looked at and carefully analyzed side by side and not separately. This also is applicable to the five steps recommended by McKinsey & Company as part of a comprehensive analysis aimed at value creation that brands and importers can take in developing and constantly updating their strategies relative to tariffs. Some retailers are large enough to also be importers, and as complex and difficult as it is, HPS recommends that they also include a continual review and updating of the tariff situation in their strategic and business planning. 

01-07-25: “Container Prices to Impact Bicycle Industry Trade in 2025?” Bike europe: “82 percent of supply chain professionals in China expect container prices to rise in January 2025, according to a survey by Container xChange. The survey also highlighted that supply chain participants are preparing for three key disruptions this year; tariffs, geopolitical risks, and structural overcapacity. These disruptions are expected to keep demand and supply dynamics volatile well into 2025 with a potential impact on the bicycle industry. Container xChange’s annual year-end sentiment survey of 900 supply chain professionals from China indicates widespread optimism about price increases in January 2025. Shift in trade flows: Rising uncertainty and volatility will likely sustain container rates at elevated levels well into the Q1 of 2025, explains Christian Roeloffs, co-founder and CEO of Container xChange. ‘The data indicates similar holding up of rates in Vietnam, where the country is increasingly becoming a key stop along the China-US trade route. Similar patterns exist in Mexico, highlighting shifts of trade flows to circumvent tariffs by leveraging trade-friendly nations with strong ties to the U.S.. For the global shipping industry, prolonged labor disputes and escalating tariffs present significant challenges for 2025.’ Stakeholders must prepare for a turbulent start to the year, as shifting trade routes and nearshoring trends reshape supply chains. Container price trends from China: Average prices for 40 foot high cube cargo-worthy containers in China have been on a gradual decline in the recent months. However, according to Container xChange there has been a steady stabilization over the past six months (July – December 2024), following a period of sharp recovery earlier in the year. In China, the average prices for 40 foot high cube cargo-worthy containers in 2023, remained relatively low and volatile, with averages ranging between $1600–$2140 (€1530 - €2050), reflecting subdued demand and market uncertainty. By the start of 2024, prices began to rebound steadily, driven by improving demand and increased frontloading of orders to mitigate potential disruptions. Vietnam gaining importance: With growing tariff concerns, Container xChange highlights that there is a growing role for markets like Vietnam and Mexico as ‘added stops’ in the U.S.-bound shipments from China. In Vietnam, average container prices surged sharply in the second half of 2024, driven by rising demand and constrained capacity. Prices in Haiphong increased by an average of 42 percent between March and December 2024, while Ho Chi Minh saw an even steeper rise of 66 percent from January to December 2024. Vietnam is in the top three exporters of e-bikes to the EU. According to the General Statistics Office (Vietnam), Vietnam’s import-export  activities continued to show positive results for the first 10 months of 2024 year over year. China remained Vietnam’s largest import source, while the United States remained Vietnam’s largest export market. U.S. – China tensions: As trade tensions between the U.S. and China escalate, tariffs are once again at the forefront of global trade policies following the re-election of Donald Trump. Early indications suggest a similar protectionist focus under the new administration, likely escalating costs and complexity for global supply chains. Meanwhile, domestically, China is grappling with declining retail sales, though industrial output shows resilience. The U.S. bicycle industry relies heavily on Chinese imports. ‘China’s economy is bracing for a slower pace of growth in 2025, as increasing trade tensions with the U.S. and domestic structural challenges weigh on its outlook. With U.S. tariffs likely to rise, we anticipate a decline in Chinese exports to the U.S., while trade flows pivot further toward emerging markets. However, stimulus measures could provide some relief, supporting infrastructure investment and domestic demand,’ concluded Roeloffs.” HPS Analysis: While the title of this Bike europe article is presented as a question, the answer is yes, container prices will impact the bicycle industry trade in 2025, and U.S. importers and retailers need to build potential cost increases into their strategic and business planning. While a U.S. dock strike is now off the table, the container shipping owners are already increasing their profit forecasts for the year in anticipation of raising container shipping costs as the result of increased international tensions tied to geopolitical events and the threats of tariffs. We are entering a period of uncertainty and disruptions that will continually change, with the one constant that every touch point in the global supply chain is going to take every opportunity to increase cost and profitability.

01-07-25: “Brompton Hit by Industry-Wide Challenges as Profits Drop 99 Percent.” Bike europe: “The boss of Brompton Bicycle has predicted that 2025 will be another year of turmoil for the bike industry after profits at the British folding bicycle maker dived by more than 99 percent amid a wave of discounting by rivals. When looking for an indication of how dire the current market situation is in the bike industry, look no further than the recent financial results of folding bike manufacturer, Brompton. The renowned British manufacturer has reported a dramatic decline in profits, plummeting from £10.7 million (€ 12.9 million) to just £4,602 € 5,543) for the fiscal year ending March 2024. The significant downturn is attributed to a combination of industry-wide challenges and economic factors, primarily the oversupply issue and lack of demand. The glut has prompted widespread discounting as companies strive to clear stock, intensifying market competition. 8% drop in units sold: For Brompton sales value decreased 5.3 percent to £122.6 million (€ 147.7 million) and an 8.2 percent reduction in units sold, totaling 84,899 bikes compared to 91,875 in the previous year. Exports accounted for 80 percent of unit sales, up from 74 percent in 2023. The company's operating costs have also risen by 15 percent, driven by increased staffing and marketing expenditures. Will Butler-Adams, the company’s CEO, said Brompton had been hit by widespread discounting by troubled businesses trying to clear stock, particularly in Europe and the U.S. The industry has also faced competition from electric rental bike schemes such as Lime, and the rise of cheaper Chinese rivals. Butler-Adams has criticized the aggressive discounting strategies employed by competitors, describing the situation as a ‘really sad state of affairs’ for the industry. He anticipates that the market turmoil will persist into 2025, albeit with some improvement over 2024. ‘The industry is still in turmoil and will not get better this year. It will not be as bad as 2024 but there is still excess stock,’ he confirmed. Strategic funding to support growth: Despite the downturn, Brompton secured £19 million (€23 million) in funding from British investment fund BGF in 2023, valuing the company at £200 million (€240 million). This capital infusion is intended to strengthen the company's balance sheet and support future growth initiatives. Through strategic funding, a focus on premium products, and expansion into international markets, the company is positioning itself to overcome current obstacles and pursue future growth. Additionally, Brompton has observed a shift in consumer preference towards its premium models, such as the T Line and P Line, with notable demand in the Asia-Pacific region, particularly China. New headquarters facing delays: Brompton had plans to relocate to a new site in Kent, aiming to restore wetlands and promote sustainable transportation in Ashford. However, this project is currently facing planning delays. The company remains committed to innovation and long-term investment, with Butler-Adams expressing optimism about achieving 15-20 percent annual growth in the medium term.” HPS Analysis: As viewed from the American bicycle market, Brompton is a niche brand, and folding bicycles, pedal-only and e-bikes, are in the “specialty” category. With this said, Brompton also represents the largest bicycle manufacturer in the U.K. and as such is an important brand across the pond. Brompton is being very forthright and transparent in reporting a drop in profitability of 99 percent, something most of their American cousins would be very reluctant to do. From this article, it appears that Brompton has a viable recovery plan and is adjusting its strategy and business planning accordingly.

01-08-25: “REI Cutting Experiences Division, Resulting in the Loss of 428 Jobs.” Bicycle Retailer and Industry News: “REI Co-op announced it will close its Experiences division that includes adventure travel, day tours, and classes. The decision was announced in an email to employees Wednesday from President and CEO Eric Artz and will mean the elimination of 428 full- and part-time jobs in that division. Customers who booked trips and day programs will receive full refunds and REI will work to address any associated non-refundable expenses. ‘We know this decision will also significantly impact many of the travel partners that we work with across the U.S.,’ Artz wrote. ‘We will begin informing partners this week and will work with them to terminate our existing contracts.’ The Experiences division served 40,000 customers last year, Artz wrote, which was fewer than 0.4 percent of all co-op customers, and Artz said in the email that even in its best year in 2019 did not generate a profit. ‘When we look at the all-up costs of running this business, including costs like marketing and technology, we are losing millions of dollars every year and subsidizing Experiences with profits from other parts of the business," Artz wrote. Despite exploring several options to continue the division, its unprofitability made continuing it impossible, Artz wrote. ‘Every path to profitability we explored would have required us to invest more time, effort, and focus away from parts of the business that reach significantly more customers, drive more positive financial outcomes, and have greater impact on our mission to get people outside. Each of the 180 full-time employees will receive their salary through March 9 and benefits through March 31. They also are eligible for separation benefits including severance, healthcare coverage continuation through COBRA, and outplacement service help. Employees who split time between Experiences and store work will discuss options with their manager. The 248 part-time employees will have benefits continue through January and will be eligible for severance pay. Artz wrote that while there remains a role for REI to play in ‘outdoor education and expertise,’ there needs to be a re-evaluation of how the co-op does it ‘to ensure they're relevant to our customers, aligned to our mission and financially viable.’ HPS Analysis: REI is the largest of the specialty outdoor retailers and it appears to be moving ahead with its store expansion while cutting unprofitable expense areas like its Experiences division. The company is being very candid in admitting that its Experiences division has never made a profit and it is, in HPS’s analysis, exhibiting good management judgment in shutting this unprofitable division down. Managing a business entity is difficult and becoming more difficult in the specialty outdoor segment because of changes in consumer preferences and buying habits. In the bicycle category, inclusive of e-bikes, there is growing recognition that our industry has been good at reaching out to enthusiast bicyclists but has done a terrible job of reaching out to casual and non-bicyclists, including children, to get them involved in the activity. Product pricing has also become a barrier and as FOB and retail value has increased from 2019 to 2024, consumers are backing away from purchasing new bicycles and e-bikes and have turned to the Circular Economy and the secondary or used market, or worse yet, deferred the purchasing decision altogether. REI’s strategic challenge going forward is providing the ‘experience’ without losing revenue and even making a profit.

01-09-25: ”U.S. Dockworkers and Shipping Companies Reached a Tentative Labor Deal, Averting a Strike at Major Ports from Maine to Texas that Threatened to Rattle the U.S. Economy.” The Wall Street Journal Logistics Report: “The WSJ Logistics Report’s Paul Berger writes that the agreement reached in principle verbally on Wednesday must still be ratified by port employers and by tens of thousands of members of the International Longshoremen’s Association. The agreement caps a contentious contract battle that drew attention from President Biden and President-elect Donald Trump. The agreement, reached ahead of the contract’s expiration on Jan. 15, avoids a repeat of a three-day strike last October that ended when the Biden administration intervened to get the sides to agree to a partial, tentative deal raising dockworker pay about 62 percent over six years. The union and employers didn’t reveal details of the new tentative agreement, but they said it ‘protects current ILA jobs and establishes a framework for implementing technologies’ that modernize East and Gulf Coast ports.” HPS Analysis: This is actually the most positive story so far this month. A Gulf-East Cost dock strike that had the potential to cripple the U.S. economy, including further negatively impacting the bicycle business, was becoming a certainty right before the incoming presidential inauguration until it wasn’t. While we still haven’t heard the results of the vote of union members, there is now very little to no doubt that the agreement will be ratified by the rank and file.

01-13-25: “Vosper: Are Retailers and Suppliers Really Going out of Business at Abnormal Rates?” Bicycle Retailer and Industry News: “There is a truism in journalism known as Betteridge's Law of Headlines. It states, more or less, that: Any headline ending with a question mark can safely be answered with the word no. The present headline isn't one of them. It ends with a question mark because we really don't know. At least not for sure. I've reviewed the notion of dealers going out of business a number of times in the past: specifically in December of 2023, more recently in May of 2024, and reaching back as far as 2019. My colleague Ray Keener tackled the same question even earlier. Both Keener and I worked with Christopher Georger's company, Georger Data Services. And each time we (and Georger) have concluded that, while some retail businesses may indeed be getting out of the cycling game, they're being replaced at about the same rate by new businesses. Be that as it may, those pieces didn't answer the Big Question of whether bike shops — or industry suppliers, for that matter — are failing at an accelerated rate versus historic norms. All we know for certain is that the overall population of dealers is pretty much constant and is even growing, thanks largely to the ongoing influx of new e-bike-only retailers, even though many of these businesses are not bike shops in the traditional sense. The dealer drill-down: Common sense tells us that some large number of these bike shops — just for purposes of discussion, let's say it's 500 or more — have gone out of business entirely in the past year. I reached out to Christopher Georger, owner of Georger Data Services and The Bike Shop List, to see if he could provide any absolute numbers on dealers who appeared on one or more of the sixty-odd bike brands' dealer lists he tracks in December of 2023 but were absent from all listings by December 2024. Georger emphasizes that his source material includes REI stores. Dick's Public Lands stores are likewise included, but not other Dick's locations. Scheels stores listed in Trek's dealer locator are included. And Beeline-only dealers are included, as are listed Yamaha dealers.’ ‘With certain notable exceptions, like a relatively few retail markets (Boston, for instance) and a handful of relatively healthy bike brands (Marin comes to mind), 2024 was a brutally tough year for just about everyone in our quirky little industry. So no promises, but here's hoping 2025 brings us something better.’ HPS Analysis: I recommend that when our readers are visiting the BRAIN website, they make a point of reading Rick Vosper’s Op Ed, part of which appears above (link in headline above).. Rick has done an excellent job of investigating the question: “Are retailers and suppliers really going out of business at abnormal rates?” In digging into this question Rick has also uncovered one of, at least to me, great unanswered questions of the American bicycle business. Why don’t we know? Why do Rick and our friend Christopher Georger find their reach and factual knowledge limited by the powers that be, the brands, manufacturers and business entities that do know, but aren’t sharing the information? The powers that be remind me of Donald Rumsfeld, Secretary of Defense from 1975 – 1977 under President Gerald Ford and from 2001 to 2006 under President George W. Bush. At a news briefing, February 12, 2002, Rumsfeld answered a reporter’s question with: ‘…there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns – the ones we don’t know we don’t know.’ Rumsfeld’s word salad was intended to avoid answering the question with the factual information the Secretary of Defense had but wasn’t going to share. HPS is of the opinion that the American bicycle industry trade association knows either the complete answer or most of the elements of the answer to Rick’s question, but aren’t going to share with the rest of the American bicycle business.

01-14-25: “CBP Looks to Increase 'De Minimis' Data Requirements.” SupplyChainBrain: “U.S. Customs and Border Protection (CBP) is proposing changes to what data elements it collects on low-cost shipments, including a new ‘enhanced entry process’ designed to curb the flow of illegal drugs and counterfeit goods. So-called de minimis exemptions allow any individual shipment valued under $800 to arrive duty-free with less scrutiny from CBP. Although the rule was initially introduced in the 1930s so that American tourists wouldn't have to pay duties on items they bought while abroad, Chinese e-commerce retailers like Shein and Temu have taken advantage of the exemptions to ship millions of online orders in smaller lots without paying tariffs, and in many cases, sneak counterfeit alternatives to brand name products through customs. Drug traffickers have also been known to use de minimis rules to smuggle fentanyl precursor chemicals or pill press parts into the U.S. CBP's proposal would require de minimis shipments to include additional data to allow customs agents to easily and accurately verify the contents of each package. That would include the shipment's country of origin, a clearance tracing identification number that references a package's original bill of lading, a tariff classification number, and at least one other data element to verify the package's contents, such as the original URL to its online marketplace listing, a picture of the product itself, or a security screening number that confirms that it's been X-rayed by a foreign customs agency. ’Every day, the men and women of CBP interdict goods that threaten the health and safety of Americans, as well as the economic vitality of our country,’ CBP senior official Pete Flores said in a January 13 news release. ‘This proposed rule will help to give us some of the tools we need to address more of these threats.’ The proposal will next go through a 60-day public comment period before the next presidential administration can review, finalize, and implement the new rules. According to CBP, this is the first of two proposals designed to tighten de minimis exemptions, with the agency planning to release the second ‘in the coming days.’” HPS Analysis: CBP is making an effort to clamp down on de minimis shipments into the U.S. that amongst other things include dangerous lithium-ion batteries for e-bike and e-scooters. HPS urges the American bicycle industry trade association and individual brands, wholesalers, and retailers to support CBP in making the proposed new rules a reality at the end of the 60-day public comment period.

01-15-25: “Giant Group Full-Year Revenues Down 7 Percent.” Bicycle Retailer and Industry News: “Giant Group's 2024 operating revenues were down 7.4 percent from the year prior, but are still above pre-pandemic levels. Operating revenues for the full year were NT$71.25 billion ($2.6 billion), down from NT$76.95 billion in 2023, according to Giant's monthly revenue report filed with the Taipei Stock Exchange. While down from pandemic years, the 2024 annual sales figure still exceeds the sales recorded in 2020 and 2019, before the pandemic boom. The company has yet to release detailed profit figures for the full year. In its most recent detailed report, the company said its net profit before taxes for the first nine months of 2024 was NT$3.27 billion, down 33 percent from the same period the year prior. Net profit after tax for the nine months was NT$2.17 billion, down 30 percent from the prior year. Giant's operating revenue in the final three months of 2024 was down 6.5  percent, 16.1 percent and 1.4 percent from the same months in 2023, respectively.”

Year	Operating revenue	Change from prior year	Net profit before tax	Change from prior year
2018	NT$60.00B		NT$3.60B
2019	NT$63.40B	5.7%	NT$4.80B	33.3%
2020	NT$70.00B	10.4%	NT$5.20B	8.3%
2021	NT$81.86B	16.9%	NT$8.70B	67.3%
2022	NT$92.05B	12.4%	NT$8.74B	0.5%
2023	NT$76.95B	-16.4%	NT$4.80B	-45.1%
2024	NT$71.25B	-7.4%	n/a	n/a

HPS Analysis: While the 2024 Giant Group financials are the responsibility of the previous management team, the new incoming management would like to start on the best possible financial start that it can. This chart is taken from the article that published in BRAIN and it tells the story of the pre-covid, 2018 and 2019, the covid and surge, 2020, 2021, 2022, and the post-covid collapse, 2023, 2024. 

01-15-25: “Arkansas Cycling Accelerator Open to Global Bicycle Industry.” Bike europe: “Open to companies based in North America, Europe, and Asia, an innovative program dedicated to promoting ten tech startups focused on cycling has been initiated by the Arkansas Global Cycling Accelerator (AGCA). The accelerator will offer a ten-week hybrid program designed to support cycling-related tech innovation. The Arkansas Global Cycling Accelerator has been awarded $125,000 in funding by the Arkansas Economic Development Commission as well as a funding match from the Walton Family Foundation to start the Global Cycling Accelerator in 2025. The accelerator is led by the University of Arkansas Office of Entrepreneurship and Innovation, Zoe Maddox, Ph.D., Phil Shellhammer, Caleb Talley and Martial Trigeaud. Open for 10 exceptional startups: ‘This new initiative aims to attract a cohort of ten exceptional startups from North America, Europe, and Asia,’ says Martial Trigeaud, co-founder and managing partner at Cardinal Cycling Group (owner of Time Sport) and the accelerator’s founder and cohort advisor. ‘The accelerator will offer a ten-week hybrid program designed to support cycling-related tech innovation, provide access to key investors and mentors, and build strategic partnerships with top brands in the industry. AGCA’s mission aligns with Arkansas’ ongoing investment in cycling infrastructure, creating a unique ecosystem where tech-enabled solutions for cycling can test and scale. With its focus on both business growth and cutting-edge technology, the accelerator promises to foster long-term cycling industry growth in Arkansas.’ The accelerator will be led by staff from Startup Junkie Foundation and the University of Arkansas Office of Entrepreneurship & Innovation’s (OEI) Greenhouse Outdoor Recreation Program (GORP). ‘This is an exciting time for the cycling industry, and Arkansas is well-positioned to be at the forefront of it all,’ adds Martial Trigeaud. ‘Startup Junkie has supported new startups in Arkansas for over a decade,’ said Caleb Talley, executive director of the Startup Junkie Foundation. ‘Given the importance of cycling to our state’s economy and the density of industry leaders in our community, it made sense for us to help organize and execute this new program alongside our colleagues from the GORP program and with Martial’s cycling expertise.’ ‘Startups interested in shaping the future of cycling are encouraged to apply to AGCA’s inaugural cohort. Applications are open now at www.cyclingaccelerator.com. Interviews will be conducted on a rolling basis until the application window closes on 11 February. Decisions will be announced by 18 February.’” HPS Analysis: The Arkansas Global Cycling Accelerator or AGCA is a very interesting development at this point in time for the American bicycle business. Frankly, the $125,000 in current funding isn’t substantial, but the AGCA does currently have the support of the Walton Family Foundation and the objective of attracting ten exceptional startups has the potential to assist a future and well-funded reshoring initiative. The NBDA Retailer Summit May 20-22, 2025 in Bentonville will be an excellent opportunity for more discussions with the AGCA, and to hear how the initiative is progressing.

01-16-25: “Why Buying a Bike Helmet Online Could Be Dangerous.” Consumer Reports: “A proliferation of third-party sellers means that bike helmets that don’t meet federal safety standards can be easily bought online from sites including eBay, Facebook Marketplace, Shein, Temu, and Walmart … You probably care about one thing more than anything else when you’re buying a bike helmet: whether it will protect your head. Though poorly-made products are never acceptable, the stakes are particularly high with a safety product like a helmet—which may be all that stands between you and a head injury or worse. That’s why bike helmets are a carefully regulated product, with mandatory standards set by the Consumer Product Safety Commission (CPSC) requiring that they adequately protect your skull in case of a crash. To comply with those standards, manufacturers of bike helmets sold in the U.S. must perform a series of tests designed to demonstrate impact protection and retention strap strength. They must also show that the helmet can stay in place and won’t block a cyclist’s peripheral vision. (The CPSC shares this guidance for manufacturers on its website and in PDF form.) To show that helmets have been tested to these standards, manufacturers are required to label helmets with specific, detailed information (see below for the exact requirements). Yet in a recent spot-check, CR’s product safety experts were able to easily find helmets available for sale online that didn’t come with the required labels and thus didn’t meet CPSC standards.” HPS Analysis: Caron Whitaker, League of American Bicyclists (LAB) Deputy Executive Director contacted HPS and the NBDA about this article by Consumer Reports (CR) and the very real safety concerns that CR and the LAB have about sub-standard bicycle helmets being sold in the U.S. Direct to Consumer (DTC) by third parties through Amazon, Walmart and other large e-commerce websites. HPS asks our readers to contact CR about obtaining copies of this and related articles to educate their sales associates about this, and to post in their stores. Also, contact the CPSC about recall notices involving bicycle helmets that are being recalled because they do not comply with the mandatory federal standards for helmets.

01-16-25: “U.S. Manufacturer Light & Motion Ceases Trading.” Cycling Industry News: “2025 has regrettably already chalked up its first confirmed business closure in the bike trade, with UK manufacturer Light & Motion announcing the move after 35 years in business. In a message to customers, Light & Motion said the closure came about due to ‘many factors,’ while also pinpointing the challenges of being a U.S. manufacturer, and noting that political talk had not necessarily translated into action to shore up U.S. producers. The customer note added that some dealers may be able to repair lights, but that full services would no longer be available. Here’s the full statement from the firm:

Dear customers,

Due to many factors, Light & Motion, a U.S. manufacturer of dive, bike, photography, and video lights is closing its operations. Over our 35 years in business, we have delivered some amazing products and enjoyed innovating to solve customer problems while building products in the U.S.

The challenges of being a U.S. manufacturer are significant and the political winds, regardless of the talk, have been against U.S. manufacturing, which continues its decline. We designed our lights to provide many years of continued use and we thank you all for your support over the years. We are not able to provide service, but some of our dealers are able to repair lights, including Backscatter.

Sincerely,
Daniel Emerson
CEO

HPS Analysis: Many years ago, as part of a Sea Otter Bike Industry Summit, I went on a tour of the Light & Motion manufacturing facility. What sticks in my memory was the enthusiasm of the employees in talking about their jobs and their products. I am very saddened by this article and the letter to customers from Daniel Emerson. There are several articles in this month’s TMR about reshoring and moving manufacturing to the U.S. Read Emerson’s letter carefully. It says: ‘The challenges of being a U.S. manufacturer are significant and the political winds, regardless of the talk, have been against U.S. manufacturing, which continues its decline.’ The data show that at the end of 2024 approximately 8 percent of all U.S. workers are engaged in some form of manufacturing. You can check this out yourself, and my intention is to underscore the steady decline in the number of Americans employed in manufacturing from the time in the early 1980s, when I was the senior corporate officer in charge of shutting down Schwinn’s domestic manufacturing, and was responsible for laying off approximately 1,800 UAW factory workers. The reason for these actions had little or nothing to do with the UAW workers and a lot to do with the Schwinn management, but that didn’t matter at the time. What mattered was the ultimate survival of the company. Manufacturing any product in the U.S. and making a profit doing so is difficult today, and for some companies impossible.

01-16-25: “Oregon Law Seeks to Ban Many Street-Legal Electric Bicycles from Bike Lanes.” electrek: “A new bill submitted to the Oregon Legislative Assembly seeks to ban street-legal Class 3 electric bicycles from bike lanes in the state. Class 3 electric bicycles include those that can reach motor-assisted speeds of up to 28 m.p.h. (45 km/h), whereas Class 1 and 2 electric bicycles can only reach 20 m.p.h. (32 km/h) under motor assist. Under Senate Bill 471, the proposed legislation would make it an offense if a rider ‘operates a moped or a Class 3 electric assisted bicycle upon a sidewalk, a bicycle path or a bicycle lane.’ Under Oregon law, traditional pedal bicycles can be legally operated on sidewalks unless restricted by a local ordinance, but e-bikes are already banned from operating on sidewalks. Thus, the proposed legislation is effectively a ban on electric bikes capable of speeds exceeding 20 m.p.h. from being used in bike lanes. Instead, such bikes would only be permitted for use on public roadways. In addition, Section 2 of the bill seeks to remove key protections for cyclists operating such 20+ m.p.h. electric bikes in bike lanes. Under current law, a motorist can be cited for failing to yield the right of way to a cyclist in a bike lane when the motorist crosses over the bike lane, such as when crossing into a driveway, parking lot, etc. It should be noted that drivers cannot visually distinguish a Class 3 e-bike from other classes of e-bikes being ridden in a bike lane because the difference is performance-based. Electrek’s Take: ‘Sure, I support this law, as long as we can apply the logic equally. If the logic goes that Class 3 (28 m.p.h. maximum) e-bikes have the ability to be ridden faster than much of the traffic flow in a bike lane and thus should be banned in such bike lanes, then we might as well just ban cars capable of highway speeds from being operated on city streets. Can your car go faster than 40 m.p.h.? Sorry, you know the rules. Keep that thing off city streets. It makes sense, right? Same logic. If it can go faster, it shouldn’t be allowed to operate there at all.” HPS Analysis: With all due respect, Electrek is begging the wrong question and making the wrong analogy. The question is the safety of bicyclists, pedestrians, and motor vehicle drivers. In a recent BRAIN article, Marc Sani points out the problems that come with bad publicity. This proposed Oregon law is just the tip of the iceberg. There are already laws restricting e-bikes and requiring licensing of e-bikes and operators, placing age restrictions on operators in New York and California, and there are more cities and municipalities, as the League of American Bicyclists points out, that are under pressure to do something to stop the PR-driven menacing danger of bicycles and e-bikes. The American bicycle industry has missed its opportunity to stand on a safety platform, and has placed itself among the manufacturers and brands of consumer goods who are advocating for the path of least resistance that will have the smallest amount of regulatory-related financial impact and the highest possible profitability. From the pre-covid period of 2019, we have evolved from “everybody” loving or at least being reluctant to criticize bicycles and bicycling to a post-covid 2024 era with e-bike lithium-ion battery fires causing property damage, injuries and fatalities in large cities, high-speed e-bikes involved in accidents, injuries and fatalities, pedal bicycles causing accidents with pedestrians and causing traffic problems and opposition to more bikeways and lanes because they cause traffic and parking problems for non-cyclists. In short, again quoting Marc Sani from a previous article: “What’s buffeting the industry today is unique to this time and place in the 21^st century.” 

Contact Jay Townley: jay@humanpoweredsolutions.com