NEW E-BIKE REGULATIONS IN THE MIX AS MARKET CHALLENGES CONTINUE

By Jay Townley

04 27 26: “Another U.S. state wants to force registration for all e-bikes.” electrek: “As electric bicycles continue to grow in popularity and grab headlines, regulatory debates are heating up. More states are clamping down on how and where e-bikes can be ridden, and even what constitutes an e-bike. Hawaii could soon become the latest U.S. state to require registration for all electric bikes, as lawmakers advance a new bill aimed at tightening rules around micromobility devices. According to local news KHON2, the legislation, which is nearing a final vote before heading to the governor’s desk, would introduce a one-time $30 registration requirement for all e-bikes in the state. It would also require manufacturer labeling that clearly identifies an e-bike’s class, top speed, and motor power. On its face, the bill largely aligns with the widely adopted three-class e-bike system, formally defining Class 1, 2, and 3 electric bicycles with the usual speed and power limits. Class 1 and 2 e-bikes can hit speeds of up to 20 mph (32 km/h) with electric assist, while Class 3 e-bikes can reach higher speeds of 28 mph (45 km/h). All three are limited to 750W of power, but only Class 2 e-bikes are allowed to use hand throttles (while Class 1 and 3 require the user’s pedaling to activate the motor). But Hawaii’s proposed legislation goes further in several key areas, including enforcement and device classification. One of the biggest changes is the creation of a new category for ‘high-speed electric devices,’ which would include anything exceeding 750 watts or 28 mph. Those vehicles would generally be banned from public roads and bike paths, officially giving law enforcement clearer authority to remove what many consider e-moto-style bikes operating outside existing rules. That enforcement angle is a recurring theme throughout the bill. In addition to registration requirements, it explicitly allows authorities to confiscate illegal or unregistered devices. As one lawmaker put it, if a device can’t be registered, it can’t be used on public roads – plain and simple. The bill also attempts to clarify how and where e-bikes can be used. Sidewalk riding would be permitted but capped at 10 mph (16 km/h) and with a requirement to yield to pedestrians. Counties would still have the ability to restrict sidewalk access in dense areas, and riders would be expected to use bike lanes when available. Safety provisions are also expanded, including raising the helmet requirement age from 16 to 18 and banning what the law deems ‘stunts’ like wheelies on public roads. On school campuses, higher-speed electric devices would be prohibited entirely, while high schools are permitted to require registration decals for parked bikes. Electrek’s Take: This is part of a broader trend we’re seeing across the U.S. States are generally trying to preserve the three-class system for traditional e-bikes while cracking down on higher-powered electric two-wheelers that don’t fit neatly into that framework, though some versions of states’ laws we’ve seen have attempted to modify or remove the three-class system that has largely become the status quo in the U.S. But requiring registration for all e-bikes, like in this proposed Hawaii law, is a notable shift that likely will create a heavier burden on riders. One of the reasons e-bikes have seen such rapid adoption is that they’ve largely avoided the bureaucracy associated with cars, mopeds, and motorcycles. Hawaii’s approach aims to bring more order and enforceability to a rapidly evolving category. The question is whether that added friction will help improve safety, or risk slowing down the growth of one of the most accessible forms of electric transportation.” HPS ANALYSIS: I call the question. Will this Hawaii state bill, and the other similar pieces of state legislation, serve to really help improve safety, or will they slow down, or stop, as the New Jersey legislation has reportedly done, the sales and growth of one of the most accessible forms of alternative, eco-friendly electric transportation? The bicycle business has not yet, in HPS’s opinion, been able to achieve the “alignment” it is seeking, and in the process has not been able to help significantly improve overall consumer safety, while continuing to sell industry-tested and certified e-bike products to the public.

04 27 26: “BEYOND TARIFFS.” POLITICO Weekly Trade: “Protectionist forces in Washington are descending on the capital this week to push the Trump administration to pair tariffs with additional measures in its Section 301 investigation into forced labor — demanding import bans, quotas, and supply chain traceability requirements. Those requests, from groups that generally support the president's approach to trade, may conflict with what USTR has signaled could be a more “flexible” tariff regime. Reminder: The administration launched a pair of Section 301 investigations last month as part of a broader program to replace tariffs imposed under ‘emergency’ powers that were struck down by the Supreme Court in February. One is looking at forced labor spanning 60 partners, including the European Union, Mexico, and China. The 12-panel, 60-witness hearing runs Tuesday and Wednesday and is a key chance for stakeholders to weigh in. USTR also launched an investigation into excess capacity, with a hearing expected early next month. Mihir Torsekar, a senior economist for the pro-tariff Coalition for a Prosperous America, is set to tell officials Tuesday that tariffs alone are not enough. Section 301(b) of the Trade Act of 1974 ‘authorizes the trade representative to take all appropriate and feasible action,' Torsekar will say, according to testimony obtained by Morning Trade, arguing that language ‘encompasses both tariff and non-tariff measures, including quantitative restrictions.’ ‘CPA urges USTR to complement tariff action with quantitative import management tools suited to the forced labor problem,’[ Torsekar will add, pointing to import licensing for supply chains with forced labor risks and tariff-rate quotas in sectors like solar, cotton textiles, and seafood. The Solar Energy Manufacturers for America Coalition, which advocates for policies that support a U.S.-based solar supply chain, will likely make a similar case, according to comments filed ahead of the hearing. ‘Tariffs matching the [IEEPA] rates, for example, would not be sufficient to deter the Chinese-owned supply chains,’ the group wrote, calling instead for full supply chain traceability mandates and a global tariff on all China-linked polysilicon. Prepare for a clash: Groups with import-dependent members are expected to push back, with the Consumer Technology Association poised to argue against broad tariffs altogether. ‘In some cases, tariffs can increase economic pressure on suppliers in those countries and create worse labor conditions, including more forced labor,[‘ Ed Brzytwa, vice president of international trade at CTA, will say, according to testimony also obtained by Morning Trade. ‘In contrast, targeted actions can better align economic incentives with desired outcomes.’ Signal of caution: Deputy U.S. Trade Representative Rick Switzer, speaking at an event hosted by the National Council of Textile Organizations earlier this month, said Section 301 is ‘built to have exemptions’ and that officials are actively working to build in more ‘nuance.’ ‘We are trying to be flexible where we can,’ he said.” HPS ANALYSIS: As a reminder, Section 301 tariffs are imposed by the U.S. on imports from countries that discriminate against U.S. businesses or violate U.S. rights under trade agreements. Remember, the first Trump Administration imposed a Section 301 tariff on Chinese-produced bicycles, PA&R, and e-bikes at the rate of 25 percent of the FOB value, stacked on top of the Most Favored Nation (MFN) tariffs. This punitive 301 tariff was continued by the Biden Administration, and after hearings and requests for exceptions, was reimposed and carried into the Trump administration. This time around, the Administration has been public about its plans to replace the IEEPA tariffs struck down by the Supreme Court with new Section 301 tariffs after the hearings that are referenced in this article. The Section 122 tariffs were imposed at 10 percent as a stopgap, and while they expire July 24, 2026, they were found to be illegal by the Court of International Trade (CIT) on May 7 and are now the subject of both more litigation and appeals, as noted by several articles that follow. Despite the testimony of The Radio Flyer Company and its president, there is no doubt some form of new Section 301 tariffs will be widely imposed by the U.S. on the nations of the world, replacing the IEEPA tariffs, until such time as they too are the subject of cases brought before the CIT.

04 27 26: “The iconic red wagon faces tariffs under Trump’s next wave.” Bloomberg: “There is no better current example out there for how President Donald Trump has shaken things up in the global economy than the still-closed Strait of Hormuz. But if you want to grasp some of the ways beyond that in which Trump still plans to shake up global commerce, consider another transportation mainstay: little red wagons. Officials from the U.S. Trade Representative’s office are holding public hearings on April 28 and May 5 as part of the tariff investigations Trump ordered after the U.S. Supreme Court ruled the bulk of the duties he imposed last year were illegal. It is all part of the statutory process Trump hoped to avoid and is now forced to go through as his team considers how to put duties on imports from countries they believe don’t enforce bans on goods made with forced labor or that have a ‘structural excess capacity’ in manufacturing. Hundreds of companies have already made written submissions. Which is where the little red wagon comes in. There are few American toys more iconic than The Radio Flyer Company’s red wagons. For generations, legions of kids have loaded them up with teddy bears, dolls, dirt, lemonade, and other childhood essentials and pulled them around the house or neighborhood. Radio Flyer was founded in 1917. It remains family-owned and headquartered in Chicago, and has diversified into analog and electric bicycles. Since the early 2000s, the company has relied on production in China. The tariffs proposed as part of the Section 301 investigation into industrial overcapacity would make importing the wagons and bikes it makes in China more expensive. So, in an April 8 submission, the company’s “Chief Wagon Officer,” Robert Pasin, requested that the Trump administration refrain from imposing new tariffs on its products. ‘American families — and American companies like Radio Flyer that have invested more than a century in bringing joy to children — cannot sustain further tariff escalation on top of the economic headwinds already facing our industry,’ Pasin wrote. What’s most interesting about the letter isn’t the existential plea against tariffs. It’s the economic case that Pasin makes that the Trump administration has gotten its diagnosis of Chinese overcapacity and what ails the global economy all wrong. To be clear, the U.S. is not the only country now worrying about a new flood of Chinese exports and what some have called China Shock 2.0. But in his letter, Pasin offers an interesting contrarian take by putting the current concerns in context. Pandemic Surge: A surge in demand for Radio Flyer’s products, coupled with supply chain problems and the inflation squeeze on household budgets that followed the pandemic, left the company with too much capital tied up in inventory and not enough going into investment and marketing. Tariffs will only make the situation worse, Pasin argues in his letter. Shifting production will take years and require yet more significant capital investments. Pasin argues the big economic issue confronting companies like his isn’t too much supply, it’s lack of demand.” HPS ANALYSIS: Mike Fritz, a founding partner of Human Powered Solutions (HPS) and recent inductee into the LEVA E-Bike Hall of Fame, worked with Radio Flyer several years ago and introduced me to Robert Pasin at the CABDA West Expo in Las Vegas this past February. We urge our readers to obtain and read Mr. Pasin’s letter to the USTR, the closing paragraph of which says: “Imposing punitive tariffs in response to normal post-boom market correction would inflict lasting harm on U.S. companies like Radio Flyer without addressing any genuine unfair trade behavior.” As HPS has opined, it seems highly unlikely that this argument, as sound and fact-based as it is, will register with the Administration. However, it is an argument that does have an economic foundation in the present “lack of demand” that the bicycle business is facing in the global markets that make up the industry's ecosystem. 

04 29 26: “Stagnant North America market leads to Thule Group's Q1 decline.” Bicycle Retailer and Industry News: “Thule Group's first-quarter net sales decreased 3.4, percent with the North America region dropping 13.8 percent. Net sales for the quarter were SEK 2,573 million ($277 million), compared with SEK 2,662 million at the same time last year. Thule noted that 7.3 percent of the decrease is from exchange rate fluctuations, and organically, sales increased by 3.9 percent. "‘The market remained challenging overall, particularly in North America,’ said president and CEO Mattias Ankarberg. North America net sales were SEK 479 million, with Thule saying the region has cautious retailers and consumers, with Canada performing better than the U.S. The region accounted for 19 percent of all sales in the quarter. Quarterly net income increased 10.2 percent, from SEK 266 million to SEK 293 million. Earnings per share increased by the same percentage from SEK 2.46 to SEK 2.71.” HPS ANALYSIS: This headline says it all. “Stagnant North America market leads to Thule Group’s Q1 decline.” HPS has been chewing on the premise that the global bicycle-e-bike supply chain and global markets have evolved into a single ecosystem. Here is a global Swedish-headquartered company, attributing its Q1 decline to a stagnant North American Market. Later, we will see a major brand attributing its current economic problems to the collapse of the Chinese bicycle market. There is now little doubt that the dynamics of the pandemic and the bull-whip effect it generated have accelerated the evolution of a global supply chain that is tied to and largely dependent on three large global markets – Europe, China, and North America.

05 03 26: “How a weaker dollar is quietly making life more expensive.” AP Morning Wire: “A hidden force is quietly pushing up costs for everything from your summer vacation to your weekly grocery bills: a weaker U.S. dollar. The dollar has fallen about 10 percent against other major currencies since President Donald Trump returned to the White House, a pullback potentially playing a role in Americans’ concerns about affordability. ‘It’s kind of a hidden tax,’ says economist Thomas Savidge of the conservative-leaning American Institute for Economic Research. ‘What your dollar is going to be able to buy is going to shrink.’ A look at where the dollar stands and what it means for you: Historic dollar decline: The U.S. Dollar Index, which measures the greenback against other major currencies, logged its steepest six-month drop in more than 50 years in the first half of 2025. Though the decline hasn’t deepened, the dollar index is still about 10 percent lower than at the start of Trump’s term. A strong dollar makes imports cheaper and can help keep inflation in check. A weak one can increase prices on foreign goods but boost American exports. U.S. presidents have long voiced support for a strong dollar even as they pursued policies that, at times, pushed the currency lower. Trump has suggested a strong dollar puts the U.S. at a disadvantage and that a weak dollar helps American industry. And as with most things with Trump, he’s been blunter in his messaging. ‘You make a hell of a lot more money with a weaker dollar,’ he said last year, one of a number of public statements showing his preference for seeing the dollar decline. Big multinationals benefit: Trump isn’t alone in seeing the benefits of a weaker buck. In recent months, corporate earnings calls have been peppered with talk of how a weaker dollar has helped companies from Philip Morris to Coca-Cola, with executives pulling out C-suite phrases like ‘favorable currency impact’ to note how the dip brought tailwinds outside the U.S. that added to bottom lines. ‘In many cases, we’ve got a weaker dollar, which is not unhelpful,’ Elie Maalouf, the CEO of InterContinental Hotels, said on a February call as the company announced higher profits and revenues. For big multinational companies that do business overseas, a weaker dollar can spur sales for products that suddenly become cheaper. But the vast majority of U.S. businesses are not operating beyond the border. For those catering to domestic customers, it’s a different story, particularly if they are reliant on importing goods.” HPS ANALYSIS: HPS has tried to make this case for months. A weak U.S. dollar is bad for the import-dependent American bicycle industry and the independent specialty bicycle dealer business. A strong dollar is good for big business and multinationals, until their liquidity is drained and committed in whole or part to the American market and the added costs of its import-dependent business. One solution is to withdraw from the American market and focus on the European and weak Chinese consumer markets until such time as consumer demand is stabilized along with liquidity. 

05 04 26: “Sea Otter emerging as a global trade event.” Bicycle Retailer and Industry News: “The numbers are in, and it appears that Sea Otter Classic continues to deliver exhibitors, consumers, campers, and racers with overall growth pegged at an average of six percent or more depending upon category. But there's one area where Sea Otter seems to be exceeding expectations — its growing draw as an international business forum that this year saw 30 new international companies join the expo. Perhaps more significant for the industry and exhibitors was the 430 international media personalities who registered and then descended on Monterey's fabled Laguna Seca raceway for the four-day expo. The potential for media exposure in a global market at a single event is almost worth the price of admission for many exhibitors. Sea Otter's growing role as an international event has not been lost on show organizers. While the expo has long been a venue for B2B meetings, that role seems to have grown in importance, said Frank Yohannan, president and CEO. And he added that Sea Otter could be at a pivot point in its future. ‘That's a good pivot point to have,’ he said, noting that exhibitor surveys have been completed. ‘And within the next week or so, Sea Otter staff will meet to review this year's event—pros and cons—and start to plan for 2027. We want to know what the opportunities and threats are that we need to be prepared for,’ he said. Sarah Timlek, the expo's sales director, spends hundreds of hours on the phone talking with exhibitors over the course of a year. Timlek, who also worked for Interbike, hears first-hand what exhibitors are thinking and what their concerns are. ‘The number of exhibitors who said they weren't going to Eurobike, that they were just doing Sea Otter, really astounded me, as well as the number of people who said they can get everything done at Sea Otter,’ she said. A telling score came through Sea Otter's exhibitor survey. The percentage who said they were coming to connect with consumers, but who were also coming for B2B meetings, were nearly equal. ‘It almost floored me,’ said Timlek, adding that in the past, the consumer connection far outstripped B2B. This is taking shape in the shadow of disarray in Europe as Eurobike, set for June 24-27 in Frankfurt, battles a potential competitor. Some German industry organizations plan to put on an international trade show in 2027. That could portend a dual trade show fight akin to IFMA's Cologne show versus an up-and-coming Eurobike. Taipei Cycle appears to be waning in international attendance from U.S. and European visitors after three years of lackluster shows. In the meantime, China Cycle, set to take place in Shanghai May 5-8, has been building its presence throughout Asia. That was clearly evident with the addition this year to the expo area of Avinox/Amflow and the bike brand X-Lab. Both companies are disrupting the marketplace with new technology (Avinox) and high-quality carbon bikes at low prices (X-Lab) at retail. Both are challenging legacy brands like Specialized, Trek, Bosch, and Shimano.” HPS ANALYSIS: This is fascinating, and our thanks to Marc Sani for his in-depth investigation and reporting on this year’s Sea Otter event and its global reach and influence. There is much more to this story, and if readers haven’t absorbed the whole article, we urge them to do so. Whether Sea Otter evolves into the international trade show that this article paints a picture of remains to be seen, but Sea Otter already has branched out to Europe, and the international supply chains and global markets are, as we have been describing, evolving before our eyes. The new companies and brands are actively challenging legacy brands, and the international trade shows of the immediate past will not be the international trade shows of the near-term future.

05 06 26: “Lynskey Performance Products files for Chapter 11.” Bicycle Retailer and Industry News: “Titanium frame maker Lynskey Performance Products, LLC, filed for Chapter 11 bankruptcy protection on April 30, saying the cashflow challenges after launching an e-commerce business with Shopify contributed to its troubles. Unsecured debts are owed to industry suppliers, including Cane Creek Cycling Components ($12,600), Full Speed Ahead ($162,000), and SRAM ($108,000), as well as industrial suppliers, shipping companies, and a credit card company.  As of Wednesday, the company had not filed a list of secured creditors with the court. On its initial petition, it listed estimated assets at less than $50,000 and estimated liabilities between $1 million and $10 million. The company had about 31 employees at the time of its filing. According to court filings by the company, the company's woes began when co-founder and managing member David Lynskey’s health began to decline. It said the decision to use Shopify to develop e-commerce sales led to the bankruptcy.” HPS ANALYSIS: As we have noted over the first four editions of 2026, bankruptcies of brands, companies, and retailers are up compared to previous years, and cash-flow and liquidity are the keys to surviving today, to be in business tomorrow. 

05 06 26: “Rad Power looks to Tennessee for assembly, distribution, and future manufacturing.” Bicycle Retailer and Industry News: “Light Electric Vehicles Manufacturing, part of the Life EV Group that acquired Rad Power Bikes in March, purchased a 100,000-square-foot facility in Algood that will serve as the assembly, distribution, and eventually the manufacturing center for the brand. The acquisition is expected to create 288 jobs and invest $7 million in Algood, about 85 miles east of Nashville, according to a joint news release issued Friday by LEV Manufacturing and the Tennessee Department of Economic and Community Development. ‘One of the top questions Rad receives from our more than 680,000 riders is, 'Where is my e-bike made?'‘ said Jim Brown, Rad Life Mobility CEO and president. ‘With this announcement, we're excited that the answer will soon start with 'right here in the U.S.' We hope it inspires continued investment across the micromobility industry in American jobs and innovation.’ Rad Life Mobility is a subsidiary of Life Electric Vehicles Holdings. ‘This location will serve as a central hub for distributing and future assembly of leading electric mobility brands, including Rad Power Bikes, Serial 1, and Life EV,’ said Life Electric Vehicles CEO Rob Provost. ‘By bringing operations closer to our customers and investing in U.S.-based manufacturing, we are building a scalable platform to support long-term growth, innovation, and job creation.’ The facility will collaborate with Tennessee's research institutions ‘to better support product innovation, battery technology, advanced manufacturing processes, and workforce development initiatives,’ according to the news release. Also, according to a news release issued in February by Life Electric Vehicles Holdings Inc. and published on its OTC Markets page, the company plans to designate the facility as a Foreign Trade Zone site, which it says will enhance supply chain efficiency, reduce tariff exposure, and improve working capital management. In March, Life Electric Vehicles Holdings Inc. completed the purchase of Rad Power Bikes' assets for $13.2 million, outbidding four other companies during an auction for the e-bike brand that declared Chapter 11 bankruptcy protection. Based in Deerfield Beach, Florida, Life EV agreed to acquire Rad Power's assets for $13,276,102 in cash. In an interview with BRAIN in March, Provost said he's planning to acquire another struggling e-bike brand. It would be Life EV's third acquisition since 2023, following Harley-Davidson's Serial 1 brand.” HPS ANAALYSIS: As we have noted, domestic manufacturing of bicycles and/or e-bikes, with or without a Foreign Trade Zone, has to be carefully planned and executed by a dedicated and expert team, with an abundance of committed working capital from investors that understand the realities of the timeline until pay-back. Give us a call if you want to know more. 

05 06 26: “Merida revenues remain under pressure despite March stabilisation.” Bike Europe: “Merida Industry's first quarter 2026 results show the company is absorbing a significant year-on-year sales decline as it works to mitigate the industry downturn. The Taiwanese company reported Q1 revenue of NT$5.49 billion (€147 million), down around 27 percent year-on-year, following a rollercoaster start to the year. Sales fell sharply by 44 percent in January and 22 percent in February, before easing to a 17 percent decline in March, hopefully an early indication that the steepest phase of the downturn is passing. The scale of the initial drop highlights Merida’s exposure to ongoing inventory corrections downstream and weak consumer demand across key markets. Like Giant Manufacturing, the company continues to feel the aftereffects of the inventory adjustments, with OEM customers still working through excess stock. However, Merida’s comparably sharper drops early in the quarter suggest the company is more sensitive to these fluctuations, particularly in its export-driven segments. Collapse of the Chinese market: The collapse of the Chinese market saw Merida’s revenue halved in 2025, weighing down the company’s overall Q1 performance. Similar market cooling in Europe and the United States has left the company with fewer revenue drivers in the short term, made especially difficult by its position at the beginning of the supply chain. The result is a more constrained global landscape, where demand recovery is less predictable. March offers Taiwanese companies battered by recent headwinds a respite and a glimmer of hope that Merida’s 44 percent revenue drop in February was the lowest point. However, a sustained rebound is still only a hopeful forecast. Ongoing geopolitical uncertainty, fluid trade dynamics, and cautious consumer spending continue to cloud the outlook, suggesting that any recovery is likely to be incremental rather than an overnight rally.” HPS ANALYSIS: Merida is currently the number two OEM in the global bicycle-e-bike supply chain and owns a percentage of Specialized. Accordingly, it represents, as a publicly traded multinational company, a window into the current supply chain and ecosystem. The collapse of the Chinese market has had a significant impact on all of the Taiwanese-based OEMs, including being openly challenged in the American market by the new wave of primarily Chinese brands. How Merida, and the other OEMs, Giant Group and Ideal, perform the rest of 2026 will provide a map as to how they will be positioned by their managers and BODs strategically going forward.   

05 06 26: “Massachusetts proposes ‘first in the nation’ e-bike and moped laws based on speed.” electrek: “Massachusetts lawmakers are considering one of the most comprehensive micromobility regulatory overhauls we’ve seen in the U.S. yet, proposing a new legal framework that would categorize everything from bicycles and e-bikes to electric scooters and Sur Ron-style electric motos into a four-tier speed classification system. And unlike many recent state proposals that have focused narrowly on restricting e-bikes, the Massachusetts bill appears to be taking a more nuanced – though still fairly aggressive – approach to defining where different types of electric vehicles belong. The bill, known as S.3077, would formally recognize Class 3 e-bikes in Massachusetts law for the first time (they were previously classified as ‘motorized bicycles’ that required a license and DOT helmet like a motorcycle), now defining them instead as pedal-assist electric bicycles that stop providing assistance at 28 mph (45 km/h). But that’s just the beginning. The bill goes much deeper, touching on every type of micromobility device, from your kid’s bicycle with training wheels all the way up to full-size motorcycles, and everything in between. A new “speed tier” system for micromobility: The core of the proposal is something called a “Maximum Designed Speed Tier Classification System,” which categorizes micromobility devices based on their top designed speed. Electrek’s Take: This is one of the most technically detailed micromobility bills I’ve seen proposed in the US so far, and interestingly, it essentially ignores most vehicle parameters such as weight and power, instead focusing nearly entirely on maximum speed. In my opinion, compared to some of the reactionary anti-e-bike proposals we’ve covered recently, Massachusetts appears to be trying to build an actual framework instead of simply banning things first and asking questions later. That doesn’t mean everyone will like it, and I still have my own issues with it, not the least of which is that a four-tier system (especially one that maxes out at ‘Tier 3’ due to starting numerically at zero) is likely to be confused with the three-class system already in use for e-bikes in most of the U.S. In Massachusetts’ new system, a Class 3 e-bike is a Tier 1 micromobility device, not to be confused with a 100 m.p.h. (160 kmh) Harley-Davidson motorcycle, which is a Tier 3 (not Class 3) device. Theoretically, the tiers seem reasonably well thought out, but the non-aligning and somewhat overlapping numerical systems working in parallel are bound to confuse people who are new to micromobility.” HPS ANALYSIS: There is significantly more detail to this Massachusetts legislation, and we urge our readers to absorb this whole electrek article and get a copy of the bill itself. As we have tried to convey, this is, as electrek has so clearly stated, the most technically detailed micromobility legislation the industry has encountered this year. It is both this technical detail and the uncertainty of the legislative process that concerns HPS. The bicycle industry has yet to prepare and table, as far as HPS knows, its own version of this legislation that incorporates what the industry currently feels is in the best safety interest of consumers, while representing what the industry currently defines and accepts as good and appropriate standards. In other words, this would be complete model legislation that has the approval of all the stakeholders. 

05 07 26: “Specialized drops prices on e-bikes at 'a competitive moment.” Bicycle Retailer and Industry News BRAIN: “Specialized Bicycle Components told its U.S. and Canada retailers Tuesday it is permanently lowering prices on its entire Turbo Levo e-bike lineup, with MSRP reductions from 6 percent to 27 percent and wholesale pricing drops of 3 percent to 27 percent. The largest reductions affect top spec models, such as the Levo R S-Works, which sees a MSRP cut from $15,650 to $11,500. The new pricing is now live on the Specialized website. In an email to retailers from Matt Kephard, the company's North America commercial leader, the brand said ‘operational improvements on the Levo platform reduced cost structures specific to this product line, and the competitive moment in e-MTB made now the right time to act. The result is a permanent pricing reset that brings more riders into the category and into your store, while supporting sustainable margins and stronger sell-through.’ The ‘competitive moment’ includes new market entrants, including AmFlow, with significantly lower pricing.” HPS ANALYSIS: In all my 69 years in the bicycle business, I have never seen anything like this. I have not seen the whole of Matt Kephard’s letter, but I do believe the BRAIN article quotes all the important pieces. Exactly what the strategy is, and I can only speculate, but the tactic is clear: drop the MSRP and margins on Specialized Levo models in the North American market. Since these are relatively high-priced models to begin with, and the reductions leave them as high priced models, we will have to wait and watch.

05 07 26: “Sales in Fox Factory's SSG unit down 9% in first quarter.” Bicycle Retailer and Industry News: “Sales in Fox Factory’s Specialty Sports Group, which includes its bicycle-product business, were down 8.7 percent in the first quarter from the same period in 2025. The company said the decline in SSG sales ‘reflects distributor and dealer inventory destocking and a difficult prior-year comparison given the industry’s first half 2025 order pull-forward partially offset by a $10.5 million or 8.7 percent decrease in Specialty Sports Group (“SSG”) net sales. The SSG division includes Fox's bicycle business through the Fox, Marzocchi, Ride Concepts, RaceFace, Easton cycling, and Lizardskins brands. SSG also includes Fox's Marucci business, which sells baseball and softball gear. Company-wide, Fox’s first quarter sales were up 3.9 percent in the quarter, to $368.7 million. It recorded a net loss for the quarter of $15 million, an improvement on its first quarter 2025, when it lost $259.7 million. Company-wide gross margin was 28.9 percent, compared to 30.9 percent in the first quarter of fiscal 2025. The company said the decrease ‘was primarily driven by the net impact of tariffs and shifts in our product line mix.’ In a call with analysts Thursday, Fox CEO Mike Dennison said, ‘We knew Q1 would be a tough column for SSG, particularly in bike, given the strength we saw in the first half of the prior year, as the industry pulled forward orders in 2025. The bike environment feels much like last year. Channel inventory has improved, but remains volatile. And demand signals remain muted as consumers are cautious.’ Dennison also mentioned that the Middle East war has disrupted some of its SSG suppliers and customers, without sharing specifics. He said the impact of those disruptions will be seen in the second-quarter financial report. In a statement, Fox said there is ‘potential’ that it will recover tariff costs paid under the International Emergency Economic Powers Act (IEEPA). But it said there is still uncertainty about the timing and size of any recovery, so the company is not including the potential recovery in its forecasts.” HPS ANALYSIS: This financial news from the Fox Specialty Sports Group generally confirms what we have been seeing in the PR from other component suppliers and brands. The North American bicycle market through Q1 is down compared to the previous year, which was also down. The one item of note is Mike Dennison’s comments related to the Middle East war disrupting “some of its SSG suppliers and customers.” However, the war has disrupted a whole bunch of things, including ocean shipping routes, so we may see more “disruptions” the longer the conflict lasts. The other issue mentioned is tariff costs and possible refunds of the IEEPA tariffs paid to Fox, and the fact that any such refunds are not being included in the compani’s forecasts. 

05 07 26: “Ideal Bike Corporation sees revenue evaporate.” Bike Europe: “Ideal failed to sustain this stability, reporting a 34.6 percent drop in revenue in the first quarter of the year. Sales at Taiwan's third largest bicycle manufacturer, Ideal Bike Corporation, follow a similar trend as the country's two other main producers, Giant and Merida. In January, sales suffered a sharp 53 percent year-on-year decline; in February, they saw a 17 percent decline, followed by another 31.4 percent decrease in March. Even though these three companies' sales continued to decline by double digits compared to January-March 2025, they appear to have shifted into the lowest gear. Three years of declining business performance have not left the Taiwanese industry unscathed, including Ideal Bike Corporation. After the sales peak in 2022, the industry waited for better days, citing excess inventory as the reason for the downturn. For 2025, Ideal reported relatively stable sales, but costs and losses rose again after implementing a radical cost-cutting strategy in 2024. Ideal failed to sustain this stability, reporting a 34.6 percent drop in revenue in the first quarter of the year, totaling TWD 486.72 million (€13.08 million). HPS ANALAYSIS: This headline did its job – it grabbed my attention. “Ideal Bike Corporation sees revenue evaporate” probably got most readers to want to find out more by reading the rest of the article, This is the number three multinational Taiwanese-based OEMs, and a 34 percent drop in revenue in Q1 is definitely a bad start to the year. 

05 08 26: “Porsche closing its e-bike performance group.” Bicycle Retailer and Industry News: “Citing ‘fundamentally changed market conditions for e-bike drive systems,’ Porsche AG announced Friday it is closing its e-bike subsidiary Porsche eBike Performance GmbH. Fellow subsidiaries Cellforce Group GmbH and Cetitec GmbH are also being dissolved, the company said in a news release. The Ottobrunn and Zagreb sites’ closing will affect about 360 eBike Performance employees. In total, the closing of the three subsidiaries affects more than 500 employees. The decision follows the planned sale of Porsche's stakes in Bugatti Rimac and the Rimac Group. ‘We must refocus on our core business. This is the indispensable foundation for a successful strategic realignment,’ according to Dr. Michael Leiters, Porsche executive board chairman. ‘This forces us to make painful cuts — including our subsidiaries.’ Last year, Porsche eBike Performance announced that it would build a battery production facility in Sveta Nedelja, Croatia, that was scheduled to open this year. In 2022,  Porsche acquired the remaining 80 percent of shares in German e-bike drive system Fazua GmbH.” HPS ANALYSIS: This came as a surprise after the articles last year and early this year about Porsche’s strategy for its e-bike performance group. It will be interesting to see if Porsche sells the Fazua GmbH drive system business they acquired in 2022, and to whom. This does not mean, at least yet, that the automotive industry is backing away from the e-bike potential in the overall individual transportation market going forward.

05 11 26: “Nike Sued by Customers Seeking Refunds of Tariff Costs.” SGB Media: “Nike Inc. is facing a proposed class-action lawsuit accusing the company of improperly seeking tariff refunds after allegedly passing those same tariff costs on to consumers. In the proposed lawsuit, consumers argue Nike should not be allowed to keep ‘significant’ refunds it may receive after the U.S. Supreme Court ruled in February that President Donald Trump lacked authority under the International Emergency Economic Powers Act (IEEPA) to impose certain tariffs. Filed in the U.S. District Court for the District of Oregon on May 8, the lawsuit alleges that Nike would improperly retain a ‘windfall’ by both passing tariff costs on to consumers through higher retail prices and simultaneously seeking refunds from the federal government following the Supreme Court ruling. They claim that after the Supreme Court invalidated the tariff program in February 2026, Nike became eligible for refunds on duties that it had allegedly already passed on to consumers through higher prices. ‘This lawsuit seeks to prevent that unjust result,’ the complaint states. The complaint maintains that Nike’s own public statements serve as evidence. In April 2025, Nike joined other footwear companies in signing a Footwear Distributors & Retailers of America letter warning the White House that tariffs would lead to ‘significant price increases’ for consumers. The suit also cites Nike’s announcement of ‘surgical’ price hikes beginning June 1, 2025, including increases of $5 to $10 on select footwear and up to $10 on apparel and equipment. The plaintiffs argue that because Nike publicly acknowledged passing tariff-related costs downstream, any subsequent tariff refund should belong – at least in part – to consumers. The filing stated, ‘Nike has made no legally binding commitment to return tariff-related overcharges to the consumers who actually paid them. Unless restrained by this ‌court, ⁠Nike stands to recover the same tariff payments twice — once from consumers through higher prices and again from the federal government through tariff refunds.’ Nike did not immediately respond to requests ​for comment. HPS ANALYSIS: While HPS isn’t ready to cast any aspersions on any brand supplier, we have our concerns about what can and actually will be done to return any of the tariffs collected to retailers in the bicycle business. This article about Nike does, however, raise some questions. To our knowledge, no bicycle brand has said that it will even attempt to actually reimburse retailers, in whole or in part, for the tariffs included in wholesale cost. So, if any bicycle and or e-bike importer of record does receive a refund from U.S. Customs it, in theory, will recover the same tariff payment twice, once from wholesale customers in the price of goods, and again from the federal government through the refund. What do you think?

05 11 26: President’s trade agenda took another hit when a federal court ruled his replacement tariffs unlawful.” POLITICO Weekly Trade: “COURT CALCULUS: Trump’s latest tariff setback is triggering a scramble among importers and trade lawyers over whether companies need to pursue new litigation to secure relief after a federal court ruled the president’s ‘Plan B’ duties unlawful. Context: The CIT on Thursday determined that Trump illegally imposed 10 percent tariffs under Section 122 of the Trade Act of 1974, a backup plan the president implemented after the Supreme Court struck down his more sweeping tariffs earlier this year. But while the trade court barred the administration from collecting the duties from the two importer plaintiffs — Burlap & Barrel and Basic Fun! — and Washington state, it stopped short of granting nationwide relief. The Justice Department quickly appealed, setting up another legal fight over the president’s tariff powers that could stretch beyond the duties’ scheduled expiration in July. Attorneys say the ruling could encourage a wave of copycat lawsuits. ‘If they’re illegal for our clients, they’re illegal for just about everybody else,’ Jeffrey Schwab, senior counsel and director of litigation at the Liberty Justice Center, which represented the importers, told Morning Trade. Schwab said other companies ‘might think maybe we should go to court and try to get the immediate injunction.’ Much of that calculation hinges on whether the appeals court temporarily pauses the trade court’s ruling and allows the tariffs to remain in place while the case proceeds. ‘If it doesn't get stayed, then you're going to have an avalanche of lawsuits,’ Luke Mathers, an associate at Sandler, Travis & Rosenberg, told Morning Trade. But Mathers said he expects the U.S. Court of Appeals for the Federal Circuit will likely temporarily pause the ruling and allow the tariffs to remain in place while it considers the administration’s appeal, similar to how the court handled earlier litigation over tariffs imposed under the International Emergency Economic Powers Act. Peter Harrell, former senior director for international economics in the Biden White House, made a similar suggestion, writing in a post on LinkedIn that the appeals court ‘in recent years has been more deferential to the Executive Branch on tariffs than the CIT has been.’ More implications: The CIT ruling could also shape how the administration approaches its planned Section 301 tariffs, which are widely regarded as a more legally durable replacement for the invalidated ‘emergency’ tariffs. The Section 122 duties at issue in the case are scheduled to expire on July 24 — just after officials expect to wrap up their Section 301 investigations. ‘If I were USTR, I’d be looking at this and thinking that I had better make sure my Section 301 investigations are buttoned up,’ Harrell told your host. ‘Between the SCOTUS opinion on the IEEPA tariffs and now this, the courts are clearly signaling they will take a hard look at expansive tariff power claims.” HPS ANALYSIS: This and the next article are going to be proof positive that the only people who stand to make a pile of money out of this whole tariff mess will be lawyers. There is no kind way to say this: the incompetent aides and councilors in the White House, International Trade Commission (ITC), and United States Special Trade Representatives (USTR) office gave very bad advice and counsel when they recommended Section 122 duties to impose as a stop-gap to fill the void left by the Supreme Court striking down as illegal the ill-advised IEEPA tariffs. The Section 122 tariffs, imposed at 10 percent, are due to expire on July 24, 2026, and be replaced by Section 301 tariffs that are now the subject of public hearings. Now, however, the Court of International Trade (CIT) has found that the Section 122 tariffs are illegal. While there are several legal issues that still have to be clarified, as this article makes clear, the CIT Section 122 decision will be appealed – probably up to the Supreme Court – and an anticipated large number of litigations will be filed by companies seeking refunds of the tariffs paid. This is on top of the refund mess surrounding the striking down of the IEEPA tariffs. As I said, the lawyers are going to make lots of money.

05 11 26: “Importers weigh lawsuits as Trump’s 10% global tariff faces appeal.” SUPPLYCHAINDIVE: “Importers should consider filing lawsuits to secure their rights to potential refunds after a trade court ruled President Donald Trump illegally imposed a temporary 10 percent global tariff, trade lawyers told Supply Chain Dive. The May 7 ruling by the U.S. Court of International Trade applied to only three plaintiffs challenging Trump’s use of Section 122 of the Trade Act of 1974 to impose global levies. While the court did not prevent the Trump administration from collecting those tariffs nationwide, lawyers said there is nothing to stop importers from filing lawsuits seeking a similar stay on tariff payments. ‘The court is sort of quietly broadcasting that the relief is limited to the named plaintiffs, and so, if you want help, you have to come and get it,’ Alexander Schaefer, a partner at Crowell & Moring, said. ‘That’s going to mean filing complaints and asking for an injunction, getting the same relief that the plaintiffs in this case got.’ U.S. Trade Representative Jamieson Greer said the administration would appeal the ruling, Reuters reported, but it is likely the administration would ask the appellate court to continue collecting the tariff during the legal proceedings, lawyers said. ‘They’ll certainly ask, and they certainly may well get it,’ Schaefer said. Nevertheless, that possibility shouldn’t deter importers from filing lawsuits, as there are no guaranteed outcomes. The Supreme Court’s rejection of Trump’s use of the International Emergency Economic Powers Act to impose global tariffs could also work in importers’ favor in the current case, Brittney Powell, partner in the International Trade Practice Group at Fox Rothschild, said. ‘We’re in a different posture here now,’ Powell said. ‘We’ve seen now there’s a little bit of a track record of using these tools to obtain tariffs, and they’re not lawful, so the likelihood of success on the merits is very high.’ However, not all lawyers agreed that importers should file lawsuits now. Devin Sikes, an international trade lawyer and partner at Akin Gump Strauss Hauer & Feld, said there’s a two-year statute of limitations on filing a lawsuit, so there’s no rush to file one now, especially since the ruling could be overturned on appeal. ‘But, ultimately, the bottom line is that if the Court of Appeals and/or the Supreme Court agree with its [CIT] conclusion, we would likely see some sort of refund process similar to what we’re seeing with the IEEPA tariffs,’ Sikes said. ‘But we’re quite a ways from that ultimate conclusion.’ HPS ANALYSIS: Sorry for two long articles about the Section 122 tariffs and potential refunds, but we wanted our readers to have access to as much factual information to action on as possible. We advise our readers to discuss their positions as importers of record with their attorneys and customs brokers as soon as possible.

05 12 26: “Industry struggles with blurring boundary between e-bike and e-moto.” Bike Europe: “The e-bike regulation issue leads to even more heated discussions in the United States than in Europe. Keeping all 50 states aligned is a big task for PeopleForBikes, and within the industry, differing interests regularly lead to friction. The topic was even announced as the phantom menace at the recent Bicycle Leadership Conference. What insights can Europe and the U.S. gain from one another? ‘The biggest threat to the future of e-bikes right now is not anti-bicycle politicians. It’s not the city councils. It’s not cars. The biggest threat to e-bikes right now is vehicles that are not e-bikes, that are being called e-bikes. If we don’t solve this problem as an industry, someone else will solve it for us, and we won’t like the result,’ said Dr. Ash Lovell, vice president of government affairs at PeopleForBikes, at the opening of the panel discussion at the Bicycle Leadership Conference 2026. Industry in shock: ‘Across the country, policymakers are seeing viral videos of 40-mile-per-hour electric motorcycles blasting down bike paths. They are seeing teenagers riding vehicles at high speeds without helmets. They are seeing crashes, complaints, and confusion. And what are those vehicles being called? E-bikes,’ said Lovell. The U.S. already learned about the solution the hard way. Last January, the state of New Jersey implemented restrictions on class-two e-bikes, comparable to the regular 250 W, 25 km/h e-bikes in Europe. This regulation required registration, a driver’s license, and insurance. The entire U.S. e-bike industry was in shock, and the business collapsed in New Jersey. However, similar regulations were nearing implementation in some European countries, including the Netherlands, during the discussion on fatbikes in recent years. Category laundry: The topic of distributing overpowered, high-speed electric two-wheelers as e-bikes is often presented as innovation, but in fact, it is category laundry. In Marin County, a quick survey at schools learned that 80 percent to 90 percent of vehicles sold as e-bikes were actually e-motos. A recent study in France found that 96 percent of fatbikes sold are non-compliant. At the Bicycle Leadership Conference, PeopleForBikes called for clear regulations to protect the industry. Similar concerns are being raised in Europe, where e-bike system suppliers are competing to continually increase power levels. Europe has a clear legal framework, but in practice, it is difficult to enforce on the streets, and the influx into the market is too big to check every single unit. ‘Protecting the future of e-bikes isn’t just about passing good laws. It’s about making sure that everyone, riders, retailers, regulators, and law enforcement, understands the difference between an electric bicycle and a motor vehicle,’ said Ash Lovell. This doesn’t automatically make streets safer. ‘Law enforcement is saying, we don't have the ability to check all vehicles on the road, we want the Department of Motor Vehicles (DMV) to regulate this, said Senator Catherine Balkespear (CA) at the Bicycle Leadership Conference. ‘And the DMV says, we are not prepared to take that on. And I think many bicycle advocates feel like they don’t really want the DMV involved in bicycling.’” HPS ANALYSIS: We found this Bike Europe article both informative and enlightening. It covers an important presentation at the PeopleForBikes Bicycle Leadership Conference (BLC) in March and similar deliberations in Europe. As the headline: Industry struggles with blurring boundary between e-bike and e-moto makes clear, both the American and European bicycle/e-bike industries are struggling with how to regulate and provide the safest e-bike products to consumers. Neither side of the Atlantic appears to have a definitive solution to address the problem, but both agree that the problem is e-motos and what to do about them.

05 12 26: “U.S. inflation jumps to 3.8% as energy costs surge from Iran war.” British Broadcasting Corporation BBC: “U.S. prices rose in April at their fastest rate since May 2023 as the impact of the war in Iran was increasingly felt by consumers. A jump in the cost of gasoline and groceries pushed the consumer price index (CPI), showing the rate prices rose by in the past 12 months, to 3.8 percent. It is the highest level since inflation hit 4 percent three years ago. The Bureau of Labor Statistics (BLS) said almost half of the rise was driven by surging energy costs, while housing and food costs also contributed. The U.S.-Israel war in Iran, and the resulting effective closure of the key Strait of Hormuz shipping lane, has led to a jump in oil prices, and this has caused a surge in the price of gas in the U.S. The national average price for a gallon of unleaded is at its highest level since July 2022, at $4.50 (£3.33), according to data from the AAA motoring group. The rise in April's inflation figure, from 3.3 percent in March, makes it increasingly unlikely the Federal Reserve will cut interest rates this year. Air fares and clothing also increased in the year to April, while the price of new cars fell slightly. April's inflation figure also marked the first time in three years that Americans' pay packets are no longer growing faster than prices are rising. While prices rose by 3.8 percent for the year to April, average paychecks grew by just 3.6 percent.” HPS ANALYSIS: Despite the wishful thinking of a few, the American bicycle “industry” and the specialty bicycle retail business are import-dependent and have been since 1990. As such, it is adversely affected by import tariffs, a weak U.S. dollar, and inflation. As this article points out, the U.S. is currently at war, which has closed the Strait of Hormuz, resulting in an increase in the global prices of oil, fertilizer, and helium, which in turn has contributed to a rise in domestic inflation. While one of the legacy bicycle brands in the U.S. has dropped some prices, the others are locked in a growing distribution and supply chain war with a new wave of primarily Chinese bicycle, e-bike, and component brands committed to affordable, high-quality, certified, high-profit margin products available domestically from local warehouses. While not all the cards have been dealt yet, the changes in the global bicycle-e-bike ecosystem are being positioned and played as this is being typed. Nothing is going back to the way it was, and we need to focus on what we can control to generate a net-pre-tax profit to survive in the near term and thrive going forward.

Contact Jay Townley, jay@humanpoweredsolutions.com