IS SAFETY THE BICYCLE INDUSTRY’S NEXT BIG THING?

By Jay Townley

07 16 26: “Bike lanes and speed cameras disappear from the DOT's list of proven safety measures.” National Public Radio npr: “The Department of Transportation is doubling down on its campaign against ‘DEI bike lanes,’ as Transportation Secretary Sean Duffy called them in a social media post earlier this month. The Federal Highway Administration has quietly stripped bike lanes, speed cameras and several other best practices from a list of ‘Proven Safety Countermeasures,’ as they're known, that have been shown to reduce crashes and save lives. The FHWA says the changes to its website, which have not been previously reported, are part of a broader review of safety countermeasures to ensure they align with current DOT policies and the administration's priorities. But critics say the Trump administration is undermining safety strategies that have already been proven to work. ‘We should be making decisions about safety based on evidence,’ Stephanie Pollack, the former acting administrator of the FHWA under President Biden, told NPR. ‘It's hard for me to understand how you could say you're putting safety first, and then make arbitrary decisions about what does and doesn't improve safety.’ Pollack oversaw the most recent expansion of the Proven Safety Countermeasures program in 2021, when the list grew to a total of 28 recommended strategies for state and local planners to consider. In recent weeks, she said, the FHWA has removed five of those strategies, including bike lanes, speed safety cameras, variable speed limits, and two other recommendations. The FHWA has not publicly announced or explained the decision to cut the list of safety strategies from 28 items to the current total of 23. In a statement to NPR, an FHWA spokesperson said the DOT is ‘taking action to reverse the last administration's policies that decreased lane capacity and increased congestion.’ ‘Drivers paying taxes and vehicle fees expect their dollars to be reinvested into our roads, not social initiatives that burden their commutes,’ the statement said. ‘Under Secretary Duffy, the Department is getting back to basics and putting safety first.’" HPS ANALYSIS: SAFETY FIRST – saving lives, reducing traffic congestion, providing transportation alternatives and reducing pollution – are all fundamentals that are also wrapped up in proven safety countermeasures, and stripping them from federal guidelines is misguided at best. Secretary of Transportation Duffy is from northern Wisconsin, where bicycling culture and annual tourism are ingrained in the warm-weather (non-winter) way of life. Those values are like all good and worthwhile things that are from moment to moment on the razor’s edge of danger, and must be fought for, starting with safety and every safety strategy that is proven to work for everyone that pays taxes and vehicle fees and those that do not. Join the League of American Bicyclists and your local and state advocates and ask Secretary Duffy to actually put safety first.

07 16 26: “Hawaii passes e-bike law defining e-motos.” Bicycle Retailer and Industry News: “Hawaii Gov. Josh Green on Wednesday signed into law an e-mobility bill that defines and bans e-motos in certain locations while regulating low-speed e-bikes the same as non-electric bikes. HB2021 adopts the three-class e-bike system and is the culmination of what the Hawaii Bicycling League calls ‘years of outreach, education, and advocacy to comprehensively update the statewide traffic code with essential definitions and guidelines for e-bikes and micromobility devices.’ However, the regulatory framework has not kept pace, especially as high-speed electric devices — often called e-motos — have entered the marketplace, masquerading as e-bikes and contributing to serious traffic injuries and fatalities. These devices will be specifically prohibited from operating on shared public roadways, bike lanes, streets and sidewalks under the new law.’ The Hawaii Bicycling League (HBL) worked with PeopleForBikes and the League of American Bicyclists, of which it is a member, on the bill's language. The law also will address unsafe riding behaviors, making wheelies and other stunts illegal. It also calls for a one-time $30 registration fee that helps support bike infrastructure and education. That fee has long been required. Additionally, the law standardizes a helmet requirement for riders under 18.” HPS ANALYSIS: The Hawaii Bicycling League (HBL) and the League of American Bicyclists (LAB), along with the rest of the bicycle business, have led this education effort to clearly define what bicycles are, as recognized by the U.S. Consumer Product Safety Commission, and what are not! Remember – safety first.

07 19 26: “Fortunes turn for major Taiwanese bike makers.” Bike Europe: “In May, Giant has turned around a 40 percent drop in sales in February. Taiwan's major bicycle manufacturers — Giant, Merida and Ideal — all reported year-on-year revenue growth in May. The figures from the publicly listed companies are the strongest indication so far this year that the headwinds Taiwan's bicycle industry has been facing may be easing. The combined revenue of Taiwan’s three largest bicycle manufacturers fell 13.4 percent, from TWD 103.2 billion (€2.8 billion) in 2024 to TWD 89.4 billion (€2.4 billion) in 2025. The first months of 2026 offered few signs of improvement, with Giant reporting a 40 percent year-on-year revenue decline in February. At the same time, Taiwan has steadily been losing ground in the European market. According to the latest Eurostat data, China accounted for 47 percent of e-bike units imported into the EU in the first quarter of 2026. Until 2023, this segment had been a stronghold for Taiwanese exporters. The shift reflects growing competitive pressure on Taiwanese suppliers in one of their most important export markets. However, the May revenue figures suggest the tide may be starting to turn.” HPS ANALYSIS: Bicycles and the bicycle business are ingrained in Taiwanese manufacturing culture, and while not the high-tech computer-chip or AI business, bicycles still represent a viable segment of the ROC economy and manufacturing base. The Taiwanese understood the eventual necessity of bringing the Western bicycle business to the PRC, even though strictly illegal, and they will find a balance to continue to be major players on a global basis.  

07 20 26: “As of August 6, 2025, the U.S. has imposed a 40 percent tariff on certain imports from Brazil, raising the total duty on most Brazilian products to 50 percent.” Copilot Search: Starting August 6, 2025, the U.S. government implemented a 40 percent tariff on specific products imported from Brazil. This is in addition to the existing 10 percent baseline tariff, resulting in a total duty of 50 percent on most Brazilian goods. The tariffs were justified by the U.S. government, citing national security concerns related to actions taken by the Brazilian government, including demands for censorship and judicial overreach against U.S. companies. Certain products are exempt from the new tariffs, including: civil aircraft and parts, aluminum and tin, wood pulp, energy products, fertilizers, and orange juice. The selective nature of these tariffs aims to target specific sectors while preserving critical trade relationships. For instance, while coffee imports from Brazil face the full 50 percent tariff, other major exports are protected from these increased duties.” HPS ANALYSIS: Brazil has not been and is not a source country for either bicycles or component parts. However, it is home to the only large bicycle manufacturer in South America, which makes it a potential, although remote, future source for the U.S. market.

07 20 26: “Will we soon see sodium-ion batteries on electric bikes?” electrek: “For the last couple of years, sodium-ion batteries have been one of the most talked-about “next big things” in the battery world. They promise lower costs, improved safety, and reduced dependence on critical minerals like lithium, cobalt, and nickel. Naturally, that has led many riders to wonder whether the next generation of electric bicycles could ditch lithium altogether. The short answer is: eventually, perhaps. But probably not anytime soon. Here’s why: ‘Unfortunately, there’s one major drawback that still limits their appeal for e-bikes: energy density. Today’s commercial sodium-ion cells generally store around 140-180 Wh/kg, with some next-generation designs expected to approach 200 Wh/kg. That’s still well behind the 200-280 Wh/kg commonly seen in premium lithium-ion cells used in electric bicycles. The result is simple: for the same battery capacity, a sodium-ion pack weighs noticeably more. That makes it a tough sell for micromobility devices, positioning them better for larger vehicles or stationary storage roles. For now, it’s not as much the weight issue as the volume, but both make it harder to integrate sodium-ion batteries into electric bikes.” HPS ANALYSIS: While the frequency of lithium-ion battery fires associated with e-bikes has diminished thanks to both education about proper charging, storage and handling, and restriction of the rules allowing importation of cheap, dangerous lithium-ion batteries, they are still occurring. Availability of a non-volatile energy source would totally eliminate this danger, but this solution is still in the future. We need to increase education and expand it to include end-of-life recycling of mid-size lithium-ion batteries.  

07 20 26: “50 percent tariffs on Canada and Carney vows to 'intensify' trade talks.” British Broadcasting Corporation bbc: “U.S. President Donald Trump has imposed a 50 percent tariff on a wide range of goods imported from Canada, in retaliation for what he called ‘unequal treatment’ of U.S. cars, dairy and alcohol. Everyday consumer items like wine and hockey sticks. and industrial goods such as cement. are among the goods targeted. However, several key exports will be spared, such as energy, potash, critical minerals and fish. Prime Minister Mark Carney responded by saying Canada stood ready to ‘intensify’ trade talks with U.S. in the coming weeks. The White House said the duties would take effect in 30 days, and mark a major escalation in trade tensions between the North American neighbours. The new duties apply to all covered goods regardless of whether the product was included under the existing free trade agreement between Canada, the US and Mexico, known as the USMCA. ‘This is the latest in a series of unilateral U.S. trade actions that began with the U.S. imposing a series of tariffs in direct violation of the Canada-United States-Mexico Agreement,’ Carney said in a statement on X. He also cited ‘threats to Canadian sovereignty,’ a possible reference to Trump's calls to make America's northern neighbor the 51st U.S. state. Monday's import taxes build on trade barriers already in place between the two nations. The U.S. has been maintaining active tariffs ranging from 15 percent to 50 percent on Canadian steel, aluminum and copper. Washington also charges a 35 percent tariff on Canadian softwood lumber, alongside a 25 percent tax on non-U.S. parts in cars. Canada has its own 25 percent counter-tariff on selected imports of American steel, aluminium and vehicles. Monday's duties come in the wake of President Trump's threat to impose tariffs over Canadian wildfire smoke drifting into U.S. cities. But there is no mention of wildfires in the executive orders that Trump signed on Monday. Instead, the three proclamations list U.S. trade irritants that were previously known to Canada related to cars, dairy and alcohol, signaling a breakdown of trade negotiations between the two countries.” HPS ANALYSIS: From NPR 8 19 26: Less than two hours before the deadline, President Trump announced on Truth Social that the U.S. will postpone a 50 percent tariff on approximately $20 billion worth of Canadian imports by three days. Trump said the two countries had reached a deal that aims to resume construction of the controversial Keystone pipeline project to deliver oil from Canada to the U.S. 

07 21 26: “Cyclist deaths are at a 40-year high. The feds want to kill more AND worsen traffic.” Electrek: “The Department of Transportation has removed bike lanes from its list of proven safety measures, among other changes which will worsen traffic congestion. The changes seem focused on making roads less safe for bicycles, when cyclist deaths are already near all-time highs. Tens of thousands of people are killed on U.S. roads every year. 36,640 died in 2025, which is actually one of the lowest rates the country has ever recorded, and has been falling for decades as cars get more safety technology. So if road deaths are down, everything is going great, right? Well… not so fast. The U.S. per capita road death rate is actually almost six times higher than that of the UK. There are over 100 countries with lower road death rates than the U.S., including countries with famously dangerous roads like India, Pakistan and Russia. Put in that framing, our ‘record low’ numbers don’t look so great. They look even worse for anyone who uses U.S. roads and isn’t in a car. In recent years, U.S. pedestrian and cyclist deaths are both at or near the highest ever rates recorded, with cyclist deaths hitting a 40-year high in 2025 and pedestrian deaths doing the same in 2022. HPS ANALYSIS: By now it should be clear that the most important message of the American bicycle business and industry is SAFETY. We need to revamp our focus and our message to feature safety first and foremost. I am serious. Tear up the plans and strategies, and recast all of them to stress and achieve mandatory safe bicycle products, including e-bikes as defined in 16 CFR 1512, and safe bicycle riding facilities and regulations as per USDOT and all federal and state agencies. The objective is to reduce bicycle and pedestrian road deaths and make all forms of bicycle riding safer and more fun.

07 21 26: “Industry needs to focus on why we are afraid to ride.” Bicycle Retailer and Industry News: By Diane Jenks, The Outspoken Cyclist: “Forget about sales, forget about profits, forget about tariffs, and forget about manufacturers and suppliers. What this industry needs to focus on — as a whole — is the epidemic of why people are afraid to ride or allow their children to ride a bicycle. When 26-year-old U.S. boxer Hahhan Rapp was killed by a driver who allegedly stopped his car, put it in reverse, and then hit her today, you have to wake up and realize that, as an industry – from manufacturers to shop owners – we need to unite and find a way to not only hold drivers accountable, but find ways to actually change the laws and have them enforced to put angry, distracted, and impaired drivers away. The slap-on-the-wrist punishment that is S.O.P. by the legal system doesn't seem to see the gravity of the problem. Legislation is spotty or non-existent. So far in 2026, 1,075 adult cyclists have been killed while riding, an annual total that has been increasing year on year. And, it's only July. It's all well and good to build more trails and protected bike lanes, which we know the administration doesn't care about as it clawed back another $1.7B in already bike/ped committed funds, but the issue isn't access nearly so much as it is the entitled thinking – and driving – of those who would just as soon run us over as give us any deference. So — while Rick Vosper talks of a ‘got milk’ type campaign — and his reasoning is certainly sound — I believe that a campaign that makes safety our #1 priority – not only a public facing campaign, but one that has political teeth, and more importantly one that will give people more confidence, might give us a much bigger bang for our buck. If the bike industry needs a PAC or some other way to make politicians sit up and not only take notice, but to act, then so be it, because what we have been doing up until now isn't working. We need to invest in the common good of our customers. Jenks is a former bicycle retailer and hosts The Outspoken Cyclist podcast.” HPS ANALYSIS: I don’t think I know Diane Jenks, and if I have met her, I don’t remember. But I do know I agree with her message: “Industry needs to focus on why we are afraid to ride.” 

07 21 26: “USDOT removes cycling road safety measures from website.” Bicycle Retailer and Industry News: “The League of American Bicyclists is urging Congress to explain why the Department of Transportation is no longer encouraging states and local governments to provide safety measures like bike lanes. Last week, the USDOT removed information about bike lanes, road diets, and speed management from its Proven Safety Countermeasures website. These measures, according to the League, are effective physical modifications implemented on roads and highways that keep cyclists safe. ‘By taking down these strategies, the Federal Highway Administration is effectively telling states and local governments that they no longer encourage states and local governments to invest in safety,’ according to the League. ‘No extent of erasure will change the physics that make speed management critical to safer streets. Removing countermeasures is like turning the light off. Communities unaware of the guidance will see crashes — ones we know can be prevented through proven countermeasures — and lives will be lost as a result … USDOT needs to explain why it is putting politics ahead of safety.’ The League is asking for help in echoing Larsen's statement by urging cyclists and industry members to contact their members of Congress. ‘We deserve an explanation on why the administration is erasing protections for vulnerable road users,’ according to the League.” HPS ANALYSIS: This is just not a repeat of the first article on page one. It is a guiding statement that the Leage of American Bicyclists (LAB) is taking an aggressive leadership position in “urging Congress to explain why the Department of Transportation is no longer encouraging states and local governments to provide safety measures like bike lanes.” DOT and Secretary of Transportation Duffy need to be held accountable for every death and injury since proven safety measures have been removed from the DOT website and literature. The American bicycle industry has an opportunity to launch an all inclusive safety campaign by rallying around the LAB in asking Congress to both explain and take responsibility for the actions of DOT and Secretary Duffy.

07 21 26: “Volkswagen enters the smart e-bike game with radar, cameras, HUD glasses, and more.” electrek Micah Toll: “Volkswagen is expanding its presence in the e-bike world with a new lineup of premium electric bicycles developed under license by n+. But instead of chasing ever-bigger motors or batteries, the new models are leaning heavily into automotive-inspired safety technology, packing in an impressive suite of connected features aimed at making urban riding safer. The main feature grabbing most of the attention from the announcement is what n+ calls Smart View, a radar-assisted rear-view camera system integrated directly into the handlebars. Rather than relying on mirrors or shoulder checks, riders can view live video from behind while simultaneously receiving blind-spot alerts when vehicles approach from the rear. The goal is to keep riders aware of traffic without taking their eyes off the road ahead. The idea of rear-facing radar isn’t new per se, with systems from Garmin adapting to different bikes and some e-bikes like the Monarc Tracer I recently tested offering it as well. But Smart View integrates camera vision as well, giving riders the effect of side/rear view cameras right on their display. The safety focus continues with an integrated Smart Lights system that goes well beyond a standard headlight and taillight. A full-length LED light strip embedded into the top tube serves as a daytime running light, while also changing color to indicate braking and turn signals. It’s a clever automotive-inspired touch, though n+ notes that some of these lighting functions aren’t currently street legal in every market. The connected ecosystem extends beyond the bicycle itself. An optional smart helmet synchronizes with the bike’s lighting system and includes crash detection capable of automatically notifying emergency contacts. Riders can also pair the bike with optional smart glasses that display navigation, blind-spot warnings, and other ride information in a heads-up display positioned within the rider’s field of view. According to n+, the HUD technology comes from engineers who previously developed helmet displays for fighter pilots. Volkswagen says the new lineup reflects its long-standing emphasis on safety, bringing technologies commonly found in passenger vehicles to the rapidly growing micromobility market. Starting at $3,999 and specced with 250-watt Yamaha mid-drive motors that push the bikes to an EU-legal 25 km/h top speed, they won’t exactly set any impressive lap times or watts-per-dollar records, but these bikes are designed for riders who prioritize ride comfort and quality over speed. Instead of chasing numbers, these bikes seem aimed at riders who prefer designs, features, and technology that improve the everyday usability of the bikes they use to replace cars.” HPS ANALYSIS: Let’s start with a dose of reality. The Volkswagen board of directors and the family that owns a controlling interest have already made it clear that they want to see an immediate profit improvement that could close four or more Volkswagen plants and the possible termination of potentially 100,000 workers world-wide. With that said, Volkswagen has entered the e-bike market in Europe with significant safety features driven by automotive technology. Mike Fritz, HPS chief technology officer, just reminded me of the initial effort to bring automotive camera technology interconnected to individual bicycles that was demonstrated at an industry conference just before the pandemic that seemed to disappear, until being brought back by Volkswagen. This is a major safety initiative that is already technologically established in the automotive sector that is just waiting to migrate to both the bicycle and e-bike segments of the market. As noted, the Volkswagen BOD may not continue funding, but the genie may be out of the bottle at just the right time.

07 23 26: “U.S. imposes tariffs on dozens of trade partners over 'forced labour' imports.” British Broadcasting Corporation bbc: “The U.S. is imposing new tariffs on around 60 trading partners accounting for the vast majority of its imports over claims they failed to properly stop forced labour. The duties, ranging from 10 percent to 12.5 percent, target key economic partners including the UK, China, EU, Canada, Japan and India. They come in on Friday as a temporary 10 percent tax on foreign goods introduced earlier this year expires. The move is the latest escalation in the global trade war reignited by U.S. President Donald Trump when he returned to office last year. The U.S. Supreme Court ruled earlier this year that many of the tariffs imposed globally under emergency powers were illegally enacted. So the president has since sought other legal avenues to pursue his flagship trade policy. It was last month that the White House first proposed a series of 10-12.5 percent duties on goods arriving to American shores from dozens of countries over concerns they were not doing enough to tackle forced labour. On Thursday, U.S. Trade Representative Jamieson Greer, acting under Trump's direction, said those duties would now take effect. ‘Today's action will begin to correct what is both a human rights abuse and distortive trade practice to improve the welfare of workers everywhere,’ his statement said. Greer invoked Section 301 of the Trade Act of 1974, which governs U.S. trade enforcement of practices that burden or restrict American commerce. Earlier this week the Trump administration invoked a different statute, Section 338 of the Tariff Act of 1930, to impose 50 percent tariffs on products from Canada. On Thursday, the Office of the U.S. Trade Representative said the latest tariffs were being imposed on partners ‘for their failure to impose and effectively enforce a prohibition on the importation of goods produced with forced labour.’ The new duties apply to the top 60 U.S. trade partners covering 99.4 percent of U.S. imports, it added.” HPS ANALYSIS: What we are witnessing is a carefully choregraphed series of executive orders imposing U.S. import tariffs that have been previously struck down as illegal by the U.S. Supreme Court. As we will see as this story unfolds, the IEEPA tariffs imposed by Executive Order in April 2025 were struck down as illegal on February 20, 2026 and replaced with Section 122 that re-established a 10 percent “base” import tariff on February 27, 2026. The Section 122 tariffs expired July 24, 2026 and were replaced with the “new” Section 301 tariffs that are the subject of this article, on 60 trading partners at a “base” of between 10 percent and 12.5 percent. We are currently waiting for the United Special Trade Representative (USTR) to issue findings of an investigation into 16 of the group of 60 trading partners for alleged violations of the “structural excess capacity” clause of Section 301 that will in all probability lead to additional, punitive tariff that will be imposed, or “stacked” on top of the “base” tariffs – but we will have to wait several more weeks for this finding to be published. As you have already read in this issue, the U.S. has imposed 40 to 50 percent tariffs of certain imports from Brazil and we will know August 19 if there will be a 50 percent tariff on certain imports from Canada. Read on and you will find articles about the opportunity and mess created by the refund of about 40 percent the IEEPA tariffs collected and the lawsuits that have already been filed against the new Section 301 tariffs. The next article is specific to the American bicycle business.

07 23 26: “Bikes hit by new Section 301 tariffs that take effect tonight. UPDATE: The tariff increase on imports from Taiwan and EU is minimal.” Bicycle Retailer and Industry News: “Industry hopes for exclusions from the Trump administration’s Section 301 tariffs were disappointed with the announcement Thursday that the new tariffs of 10 percent and 12.5 percent will take effect Friday at 12:01 a.m. and will apply to 99.4 percent of all imports, including those from the major bike-producing nations of Taiwan, China, Cambodia, Vietnam and Malaysia. The exclusions include some agricultural products, aerospace and defense products, medical and humanitarian donations. The new tariffs replace an existing 10 percent tariff imposed under Section 122 which was set to expire at 12:01 a.m. Friday. The Court of International Trade ruled the administration's use of Section 122 illegal, and some importers have hopes of eventually being refunded tariffs they've paid under Section 122, but the decision is under appeal. A carve out for Taiwan and EU: For imports from the EU or Taiwan, where the long-standing MFN tariff on bikes is generally 5.5 percent or 11 percent, the new tariff will increase to 10 percent but not be stacked, and with the Section 122 going away, there's actually a reduction in some cases, according to a presidential memo today and one bike importer's interpretation of it for BRAIN. According to the memo, on bikes from the EU and Taiwan that currently have an MFN of 5.5 percent, the tariff will increase to 10 percent (but the 10% Section 122 will expire, so importers will actually now pay a lower total rate). Bikes from the EU and Taiwan with an MFN of 11 percent will continue at 11 percent without the new Section 301 or the Section 122 stacking. This ‘net of MFN’ exclusion is only for Taiwan and the EU. Most of the bike-producing nations are on a list of 54 countries whose products are hit with the 12.5 percent tariffs. The list of six countries whose products are subject to the 10 percent tariff includes Canada, Ecuador, the European Union, Indonesia, Mexico, and Pakistan.” HPS ANALYSIS: This BRAIN article points out what appears to be lower tariffs going forward from certain U.S. source countries, which is good news if it holds. The wild card is the yet to be published “structural excess capacity” investigations involving 16 trading partners that includes all of the primary source countries for bicycles and e-bikes imported into the U.S. The White House said in a report on Thursday of last week that more than 40 countries had helped China sidestep U.S. tariffs by routing exports through nations that face lower American import duties. The countries named included most of the primary sources of bicycles. This White House report, coupled with the structural excess capacity Section 301 investigations, are certainly jaw-boning in preparation for the scheduled visit to Washington in September by President Xi Jinping of China to, among other issues, conclude several trade agreements with the U.S. Readers will find an article expressing Chinese concerns about an apparent lack of preparation for this official state visit. 

07 23 26: “Suppliers react to PeopleForBikes initiative.” Bicycle Retailer and Industry News BRAIN: “Last week, PeopleForBikes (PFB) launched their America Builds Bikes initiative in support of the U.S. Bicycle Production and Assembly Act, (HR 3904) currently under consideration in the U.S. House of Representatives. The initiative was started by PeopleForBikes primarily to support the U.S. Bicycle Production and Assembly Act and to highlight the challenges and opportunities of the current moment. We reached out to Chris Bell, the director of federal policy for PeopleForBikes for context. Chris leads PFB’s engagement with lawmakers, executive agencies, and partner groups to advance PFB’s policy agenda. We also connected with U.S.-based supply companies, one of whom clearly does not share the industry’s general enthusiasm for on-shoring. HR 3904 has a 10-year window of tariff relief to encourage on-shoring to the U.S. ‘In the short term, the bill is designed to protect and grow domestic assembly, including for companies working with frames produced overseas,’ Bell said. ‘In the long term, we believe that the way to increase domestic frame manufacturing is to reestablish the U.S. as a bicycle production power via expanded domestic assembly. Today, tariff barriers make it economically unrealistic for the vast majority of the U.S. bicycle industry to even consider building on U.S. soil. HR 3904 removes those barriers. Our goal is to give many bicycle companies something they haven’t had in a long time: a choice,’ Bell said. ‘Not all U.S. suppliers, so varied in where their production takes place and why, are specifically supportive of HR 3904. However, there seems to be a consensus that in the long run, it’s better to create conditions for domestic assembly and ultimately, manufacturing and see how that opportunity plays out over the next decade. Between cost increases and evolving trade pressures, it’s not getting any easier to build bikes in the United States,’ Bell concluded. Under the current trade environment, many bicycle companies can’t even consider producing domestically. This bill would present a moonshot opportunity for companies to consider expanding their domestic footprint and to reimagine what is possible for the U.S. bicycle industry.” HPS ANALYSIS: This is an excellent article about the HR 3904 the U.S. Bicycle Production and Assembly Act. I do think too little ink is expended covering the skillful management of this bill by Representative Thompson and his staff to not only get it introduced after the House leadership declared that no legislation even mentioning “bicycles” would be introduced. With this said, it is obvious that the established American bicycle component manufacturing community is going to have mixed feelings about this bill. What also isn’t mentioned is the export potential that HR 3904 can establish and develop. HPS agrees that this bill is a long shot, but the Bicycle Caucus in the House, and its chair and co-chairs, have worked together to give the possibility of actually successfully manufacturing, not just assembling, but actually manufacturing bicycles and e-bikes on U.S. soil, real hope. The safety message can be easily attached to testimony and lobbying in favor of HR 3904, and the American bicycle business has to decide if it really wants to successfully manufacture some of its products in the U.S. for domestic consumption and export.”

07 26 26: “Climate change is now threatening a pillar of childhood: summer break.” National Public Radio NPR: “On a beautiful summer day in July, seven-year-old Penelope is turning into a mermaid. ‘I like playing mermaid,’ she says, with her feet dangling in the swimming pool at Beauvoir Summer Camp in Washington, D.C. ‘Like, I'm a human, and then I turn into a mermaid, and I use one of the pool noodles as a dolphin, and I play with my friends,’ she says. It's Friday, which means free swim, and the kids are splashing around on blue kickboards and sinking miniature torpedo toys. In the kiddie pool, the littlest campers jump in and show off their twists and turns with screeches of delight. Penelope and her best friend Sam, also seven, say pool time is their favorite activity at this camp. NPR is only using the kids' first names because they are minors. The pool was empty during the last free swim. Campers spent the day indoors to avoid hazardous air quality from wildfire smoke. And, earlier in the summer, the heat forced them to cut down their outside play time, says Drew Mackay, the director of auxiliary and summer programs at Beauvoir School. This summer has brought no shortage of extreme weather and wildfires across the country. In northern Minnesota and Canada, fires devastated communities and caused dangerous smoke to blanket large swaths of the Midwest and Northeastern U.S. Deadly floods prompted disaster declarations in parts of Texas. And an extreme heat wave in July was dubbed the ‘new normal’ for July Fourth celebrations.” HPS ANALYSIS: The American bicycle business doesn’t talk about climate change, even though it has and will have a growing grip on actually getting outside and enjoying riding a bicycle. It is hard to have fun riding a bike when it is raining and thundering, and the wind is blowing. As a former co-owner of a commercial campground that offered bicycle tours, I can tell you that if you can hear thunder, you can expect lightning. With that said, we need to plan the weather into our outdoor activities and reach out to other outdoor activities in our communities to provide managed bicycle and e-bike riding. Based on the proven and profitable experience of specialty bicycle retailers who do plan around the weather, you can combine indoor and outdoor experiences. Planning around climate change can also be folded into the safety message.

07 26 26: “What the American tin can reveals about tariff policy.” Bloomberg: “The industry’s struggle is a cautionary tale as the U.S. president tries to rebuild his protectionist regime. In the chaotic history of Donald Trump’s tariffs, Commerce Secretary Wilbur Ross’ appearance on CNBC on the morning of March 2, 2018, is a mostly forgotten footnote. The president’s surprise announcement the day before that he was planning a 25 percent tariff on imported steel had sent markets tumbling. Ross, a Wall Street titan, was there to try to convince nervous investors their fears were overblown. Four minutes in, in a gray suit, his tie slightly askew, the billionaire reached for a prop on the desk before him. ‘What I would like to do, though, is to emphasize again the limited impact,’ Ross offered in his deliberate monotone, raising his left arm and cocking his wrist. ‘This is a can of Campbell’s soup.’ Ross said he’d gone out that morning and bought a can of chicken noodle at a Florida 7-Eleven for $1.99. By his calculation, it contained just 2.6¢ worth of steel. ‘If that goes up by 25 percent. That’s about six-tenths of one cent on the price of a can of Campbell’s soup,’ he went on. ‘Who in the world is going to be too bothered by six-tenths of a cent?’ The small costs would come with immense benefits, Ross argued. ‘You’re talking tens and tens of thousands of jobs being created, and hundreds and hundreds of millions of dollars of capital investment coming,’ he declared. The levy on steel marked the first major tariff volley of a presidency that, in the economic realm at least, has been defined by import taxes. On Friday, Trump slapped duties as high as 12.5 percent on imports from 59 countries and the European Union after the U.S. Supreme Court earlier rejected the legal rationale for much of his protectionist regime. Trump’s theory remains that tariffs — taxes paid by importers on goods purchased from abroad — will protect U.S. industry and drive companies to invest in domestic factories. The goal is to spur an American reindustrialization and an economic rebirth in parts of the country that spent decades losing manufacturing jobs and people. The idea helped carry Trump to the White House in 2016, and he’s doubled down on it since returning last year. Eight years into the experiment, though, the story hasn’t turned out quite as Ross, or Trump, foretold. What has actually happened to the tin can, how it’s made, and the future it faces, says a lot about how the president and his often unpredictable use of tariffs have shaped the U.S. economy since his first election. It’s a story that’s not just about the economics of tariffs, but also about unintended consequences and unfulfilled promises. That can of Campbell’s chicken noodle soup Wilbur Ross held up on TV would cost you $3.49 at 7-Eleven today, 75 percent more than he paid in 2018. In a statement, Campbell’s Co. said it doesn’t set the retail price for its cans and has been working to ‘help keep our products affordable for American consumers’ in response to tariffs and inflation.’ Kush Desai, a White House spokesman, blames the Biden administration for exempting too many companies and countries from tariffs and failing to address affordability. ‘The story here really is about how Biden’s inflation crisis increased food prices.’ Today, Ross isn’t convinced the American steel industry’s future is in tin cans. Asked why things turned out as they did, he points to the rising cost of tin and the surging price of the fruits and vegetables that fill those cans. Making tinplate is also finicky, offering only a thin profit margin for producers, he says. He speaks from experience. For a few years in the early 2000s, Ross and his International Steel Group owned the Weirton mill, until he sold his steel company to Indian billionaire Lakshmi Mittal for $4 billion in cash and stock in 2005. ISG struggled to make the Weirton mill profitable and cut costs, Ross says. ‘The acquisition we made of Weirton turned out not to have been our best idea.’ Still, Ross has taken away a broader lesson about tin cans from what’s happened since he went on TV that day and brandished his can. ‘One thing it proves is that tariffs don’t necessarily solve every problem the world has,’ he says. ‘And that, I think, will always be true.’” HPS ANALYSIS: My apology for the length of this article, even though I made every effort to edit it. The story of the American tin can is the story of American tariff policy. Wilber Ross was, as the story relates, Secretary of Commerce in the first Trump administration. He was, I would opine, much better at the job than the person who currently holds it. With that said, the same tin can of Campbell’s chicken noodle soup that Wilber Ross purchased in 2018 for $1.99 does cost $3.49 eight years later, in 2026. An increase of $1.50, or 75 percent, is attributable primarily to the cost of an imported tin can or the imported material to fabricate that tin can in the U.S.  

07 27 26: “China says U.S. pledged to cap replacement tariffs at 20 percent.” Bloomberg: “China said the U.S. had committed to cap replacement tariffs on Chinese goods at 20 percent, staking out a limit on further increases after U.S. President Donald Trump imposed a new levy. The Commerce Ministry disclosed the commitment for the first time Monday, saying Washington had made it during bilateral trade talks. By pointing out that the current replacement tariff is 12.5 percent, Beijing appeared to signal that the U.S. has 7.5 percentage points of room for additional increases before reaching the stated ceiling. The Trump administration’s new tariffs came as the U.S. president rebuilds a protectionist wall after the Supreme Court struck down his initial levies. The duties are in line with tariff levels it had proposed last month on 60 trading partners, citing what it said were inadequate efforts to address forced labor. The new rates replace global duties of 10 percent that expired on July 24. The U.S. has also previously initiated a separate probe into China, citing alleged overcapacity issues in its manufacturing sector. The outcome of that investigation could lead to a further increase in levies.” HPS ANALYSIS: Obviously, the Chinese are doing their own jawboning leading up to the visit by the President of the PRC to Washington scheduled for September. A 20 percent total U.S. import tariff would be a substantial reduction for the American bicycle business, if it holds. As a previous article has already noted, the White House has issued a report alleging that 40 countries have aided China in avoiding U.S. tariffs. This report and its allegations claim that aiding China has cost the U.S. jobs and millions in tariff revenue. China has denied the allegations, but we have no idea of how this White House report will affect the U.S. Special Trade Representatives (USTR) findings in the Structural Excess Capacity Section 301 investigation where China is one of the 16 countries being investigated. HPS projects a high probability of the USTR finding placing an additional punitive 301 tariff on China along with several other source countries for bicycles. This is not to say the U.S. will agree to the 20 percent cap on import tariffs from China, but right now we do not think it is highly probable. 

07 27 26: “Trek limits speeds on e-bikes and e-MTBs.” Bicycle Retailer and Industry News: “Trek Bicycle announced Monday that all electric mountain bikes it sells will be class 1, be limited to 20 mph assisted speed, and will not have a throttle. Other Trek e-bikes, for use on pavement or paths, will be either throttle- or pedal-assist. Bikes with throttles will limit assistance to 20 mph, and bikes with pedal assist will be limited to 20 mph or 28 mph, depending on the model. ‘These standards strike the right balance between delivering the benefits of electric bicycles, respecting shared spaces, and protecting the trails and paths riders depend on. Trek believes access to shared places to ride, including mountain bike trails, may be at risk because of the lack of responsible limits being upheld by manufacturers,’ the company said in a statement. Trek President John Burke said, ‘As an industry, we’ve worked for decades to earn access to trails and bike paths. We’d rather lead with responsibility today than explain tomorrow why riders lost access to the places they love and to a sport that makes the world a better place.’ In the statement, Trek said, ‘Trek believes products that rely on throttle power beyond 20 mph or pedal-assist beyond 28 mph are e-motos, should not be used on bike paths, and belong in a different regulatory category. It is an opportunity and a responsibility for the industry to establish thoughtful voluntary standards before access and safety challenges lead to broader restrictions." HPS ANALYSIS: This is a significant safety message from Trek, one of, if not the, leading bicycle brand in the American market. HPS assumes that some and perhaps all of the other brands will adopt this, or a similar policy statement, to make it clear that e-motos are not electric bicycles and “belong in a different regulatory category.” 

07 27 26: “Trump’s Section 301 tariffs face lawsuit seeking removal, refunds.” SUPPLYCHAIN DIVE: “Two U.S. businesses are suing the federal government over new Section 301 tariffs imposed last week, adding another chapter of legal scrutiny for the Trump administration’s duty-reliant trade policy. The companies, spice importer Burlap and Barrel and watch retailer Collective Horology, are calling for the removal of the new levies and the payment of refunds, according to a lawsuit filed with the U.S. Court of International Trade on Friday. In the filing, the businesses argue that the tariffs, installed to address forced labor regulations of more than 60 trading partners, are ‘arbitrary and capricious’ and being used as a backdoor attempt to replace levies that were previously removed. The businesses also claim the Trump administration did not effectively follow or meet Section 301 requirements before imposing the duties. The Section 301 tariffs went into place on Friday, the same day the lawsuit was filed and exactly 150 days after President Donald Trump implemented temporary Section 122 tariffs. Duties installed under the statute can remain in place for up to 150 days unless extended by an act of Congress. Trump instituted the Section 122 levies following a February Supreme Court decision that revoked sweeping tariffs he installed using the International Emergency Economic Powers Act the year prior, including a global baseline duty of 10 percent. ‘The rates imposed by the Section 301 Action closely track the rate structure previously imposed or negotiated under the invalidated IEEPA program, including its 10 percent baseline tariff and additional country-specific rates,’ the lawsuit says. The lawsuit further alleges the Trump administration determined the Section 301 tariff rates before concluding the investigation and then assembled supporting evidence to install the duties after the fact. The Trump administration will now have to convince the court ‘that the proportional relief to the alleged harm occasioned by each of the 60ish countries just happened to fall in the 10-12.5 percent range in every instance, which in turn just happened to be more or less the same rate heretofore deployed under Section 122,’ Alexander Schaefer, a partner at Crowell & Moring told Supply Chain Dive in an email last week, adding: ‘That strikes me as a pretty tough sell.’” HPS ANALYSIS: It only took a week for two U.S. businesses to bring legal action against the federal government over new Section 301 tariffs. The companies, spice importer Burlap and Barrel and watch retailer Collective Horology, are calling for the removal of the new levies and the payment of refunds, according to a lawsuit filed with the U.S. Court of International Trade on Friday, July 24th.

07 28 26: “Shimano sees robust H1 fishing tackle sales; bike business remains weak.” Sporting Goods Business SGB: “Shimano, Inc., the Japan-based maker of bike components and fishing tackle, is reporting that the global economy generally maintained its solid footing during the first half of fiscal year 2026 ended June 30 (H1, first half). However, the company also said the economic outlook remained uncertain due to factors such as trends in the trade policies of various nations (re: U.S. tariffs) as well as rising geopolitical risks, such as rising energy prices against a backdrop of escalating tensions in the Middle East.

07 28 26: “Shimano warns of 1 percent price increase.” Bicycle Retailer and Industry News: “Shimano says soaring raw material costs due the Middle East war may force it to slightly raise prices on bicycle components next month. The company said the war poses little threat to its revenues, as Middle East sales are less than 1 percent of its business. But increased procurement costs, the cost of securing alternative raw materials, and rising sea and air freight rates, all due to the war will result in higher production costs. ‘A portion of these cost increases will be passed on to selling prices,’ the company said. Shimano said the extra costs will amount to an estimated 4.0 billion yen ($24.4 million) in net revenue for its full fiscal year (all in the second half) due to ‘soaring raw material prices and price increase requests from suppliers.’ It said it would partially offset the cost increase by passing through a price increase on components, resulting in an estimated extra 2.0 billion yen in net sales revenue in the second half of the year. It said the price increase will start in August. HPS ANALYSIS: We combined these articles because the Shimano financial reports are chock-full of financial data and these two reports headline what HPS considers the heart of the Shimano reporting: The bike business remains weak and Shimano is warning of a small, 1 percent price increase.

07 29 26 “U.S. interest rates held for fifth time in a row.” British Broadcasting Corporation bbc: “U.S. interest rates have been held for the fifth time in a row by the Federal Reserve.The decision, which was broadly expected, means rates remain between 3.5% and 3.75%.Higher interest rates make borrowing more expensive for people wanting to secure loans, mortgages and credit cards, but can lead to better returns on savings.Policymakers decided to keep rates at the level they have been since December last year after inflation, the rate at which prices rise, slowed last month, but concerns remain that the dip could prove short-lived.Despite inflation falling to 3.5% in the year to June, the rate prices are rising at remains above the Fed's 2% target, as it has been for more than five years. The lower rate of inflation last month does not mean prices are falling, but that they are rising at a slower rate.There is also growing uncertainty over the impact of the ongoing conflict in the Middle East on global oil prices and subsequently general consumer prices in the coming months. On Wednesday, Brent crude, the global benchmark for oil prices rose by more than 6% to above $89 a barrel. HPS ANALYSIS: With the change in Chairman of the Federal Reserve the monthly press conferences have taken on a totally different character. There is less factual information disclosed and little if know projections or discussion about the future because answers to questions are shorter and lack comment.

07 30 26: “U.S. economic growth sees surprise slowdown in second quarter.” British Broadcasting Corporation bbc: “There was a surprise slowdown in U.S. economic growth in the three months to June despite an increase in consumer spending, according to official figures. The Commerce Department said the U.S. economy grew at an annual rate of 1.5 percent in the second quarter, down from 2.1 percent seen in the first three months of the year. Analysts had forecast growth to remain around 2 percent. It comes as the world's largest economy continues to weather the financial impact of the war with Iran and U.S. businesses navigate tariffs. The second quarter downturn was due to lower government spending, investment and exports, which offset the boost in consumer spending. Consumer spending, which accounts for more than two-thirds of economic activity in the U.S., grew at a rate of 3.2 percent last quarter after slowing to 0.5 percent earlier this year. Despite prices rising at 3.5 percent in the year to June, Americans continued to spend on motor vehicles - particularly light-duty trucks - furniture and prescription drugs, according to surveys. Michael Pearce, chief U.S. economist at Oxford Economics, said the growth slowdown underplayed the ‘strength’ of the U.S. economy and suggested the pace would return to above 2 percent later this year. He said there were signs that investment in industries away from the AI boom was ‘reviving’. Pearce added that ‘surging AI-related investment is still the biggest game in town,’ but said the rise in imports of microchips used in its development means its contribution to growth remained modest. HPS ANALYSIS: This slowdown is worrisome for small retail businesses that are dependent on consumer spending at or near previous levels for revenue and gross margin. If revenue stays the same, but gross margin of profit declines because of any number of factors, the decline in profit remains problematical. U.S. economic growth will need to be watched very carefully going forward. 

07 31 26: “European bicycle market stabilizes while local component production loses ground.” Bike Europe: “The European bicycle component production declined significantly in 2025, with the market value falling to €1.92 billion, down 13 to 14 percent. The European bicycle industry has continued its transition towards a more balanced and demand-driven market. Following the exceptional surge in demand during the COVID boom, supply chain disruptions, and the subsequent market correction, the latest 2025 data clearly indicate that the industry is stabilizing. ‘This is a sign that the inventory troubles that we have had coming out of COVID are now finally at the end,’ said industry body ECI CEO Paul Walsh at the presentation of the 2026 Bicycle Industry & Market Profile (BIMP). ‘The industry has now navigated through the challenges it faced since the pandemic,’ said Walsh. Of course, it is also evident that the area benefiting from overcoming those inventory challenges is foreign manufacturing markets rather than domestic production. For Shimano, the situation of inventory constraint is not over yet. Besides further signs of stabilisation, the component manufacturer also reported in its 2026 half-year report that ‘inventory correction continued across the supply chain.’

Headline figures for the 2025 European market:

1. Bicycle and e-bike production: 10,820 million units (same as 2024)

2. Bicycle and e-bike sales: 15,618 million units (decrease of 2.6 percent compared to 2024)

3. Total sales value: €18,252 billion (decrease of 0.84 percent compared to 2024)

4. Direct employment in Europe: 67,076 (increase of 1.025 percent compared to 2024)

‘Despite market fluctuations, the European bicycle market has grown to €18 billion in annual sales, representing 18 percent real growth since 2018 after adjusting for inflation,’ added Walsh. ‘I don't think many other transport sectors can claim that level of growth.’” HPS ANALYSIS: The recent reorganization of the European Bicycle Industry Trade Associations will result in a number of changes and improvements, including more and better trade data as evidenced by this article, although HPS does expect more and better data in future reports. The biggest surprise was the decline in European component manufacturing and the increase in imports of components, primarily from Asia. Europe has a huge data advantage over the U.S. market in that the EU and UK know what their domestic production and, more importantly, imports of e-bikes are. The U.S., on the other hand, has no idea what e-bike imports are and only partial data on domestic assembly and manufacturing of e-bikes. 

07 31 27: “Chinese investments in the European bicycle industry have only just begun.” Bike Europe: “Chinese investors were less active in the bicycle industry in the past than it appeared from the outside. To date, there have been very few known investments by the Chinese in Western companies. Since 2015, corporate acquisitions by Chinese investors have mainly involved Asian companies, with the target firms mostly being bicycle component manufacturers. Why are there relatively few takeovers by Chinese investors in our sector? Sales processes in which potential Chinese buyers actively participate are rare and often very protracted, as bidding behavior is usually very tenacious, potential buyers are reluctant to make binding commitments, and they often struggle with the pace of Western transaction processes. Production is already outsourced to China: Why don’t we see more takeovers by Chinese investors in our sector? There are several reasons: the primary value creation in bicycle components – such as frame manufacturing or carbon production – has been established in China and Taiwan for decades. Brands like Specialized, Trek, Scott, and Canyon have already outsourced large parts of their products to China and Taiwan. Acquiring a company or a brand offers relatively little industrial benefit. Instead, Chinese firms are concentrating on developing and expanding their own premium brands such as Winspace, X-Lab, Seka, Elves, and others. It is also evident that Chinese investments within the cycling sector are less frequent than in automotive or mechanical engineering industries. Nonetheless, Chinese cycling companies hold significant influence over the market performance of brands and retailers, as they are deeply embedded in the value chain as OEM partners and often wield financial influence over their customers, particularly concerning payment terms and liquidity management for brand owners and retailers.” HPS ANALYSIS: HPS is currently of the opinion that China already has a significant influence over the global bicycle and e-bike industry and business, and that that influence will both shift strategy and investment going forward. The state-owned bicycle-e-bike manufacturers are in the process of expanding into full-service distribution in the American market, and HPS understands the expansion into distribution is also occurring in the EU. We believe there are indicators that the Chinese strategy is moving away from seeking and serving European and American brands and shifting to distributing and selling its own brands through specialty bicycle retailers.

08 03 26: “U.S. states sue to block Trump tariffs impacting dozens of countries.” British Broadcasting Corporation bbc: “Twenty-five U.S. states sued the administration of U.S. President Donald Trump on Monday over new tariffs of 10 percent to 12.5 percent on goods from 60 trading partners. The tariffs came into effect in July, targeting countries including the UK, China as well as the European Union, over Washington's contention that they have failed to properly tackle forced labour. In a legal document seen by the BBC, the coalition of Democratic states said the decision was ‘arbitrary, capricious, and contrary to law.’ In response, White House spokesman Kush Desai said: ‘The U.S. is using its lawful authority’ to address practices that burden American businesses. Desai added that any foreign country's failing to deal with the importation of goods produced with forced labour was ‘unreasonable’ and must be addressed. The duties cover 99.4 percent of U.S. imports, according to the Office of the US Trade Representative.” HPS ANALYSIS: There are now two groups of companies and 25 state governments that have joined in filing legal actions against the new Section 301 tariffs imposed on 60 U.S. trading partners. As noted, the subject tariffs came into effect in July and cover 99.4 percent of all U.S. annual imports. As we have already noted in this month’s newsletter, there is one more Section 301 investigation involving 16 of the 60 trading partners and a significant trade negation with China when President Xi visits the U.S. in September that will finalize the tariffs that will be covered by these suits. During this time frame the U.S. Court of International Trade will hear oral arguments on September 30. The three-judge panel said in a procedural order that it is setting up a ‘master case’ to manage the three cases in tandem and will appoint a ‘steering committee’ made up of lawyers for the plaintiffs to file consolidated briefs and allow for coordination. 

08 04 26: “Experts: It could be months before Giant’s import woes are resolved.” Bicycle Retailer and Industry News: “More than 10 months after Customs and Border Protection blocked U.S. imports from Giant Group’s Taiwan factory over alleged forced labor violations, there is little sign of resolution, despite the company’s reforms. Legal experts and recent history suggest it could be more months — even years — before CBP lifts or modifies the Withhold Release Order it imposed last September. Giant USA — and other U.S. brands that have bikes built by Giant’s factories — can continue to import products made in Taiwan-based company’s facilities in Vietnam, China, the Netherlands or Hungary. But U.S. dealers told BRAIN they have been unable to get higher-end carbon fiber Giant models and some mid-priced aluminum-framed bikes because of the WRO. When Giant unveiled new high-end road bikes in June to the cycling media, it had to note that the models (the men’s Revolt and women’s Liv Devote ) will be unavailable indefinitely in the U.S. due to the WRO. The CBP can impose WROs when it obtains evidence that creates a reasonable suspicion that merchandise was produced wholly or in part using forced labor. WROs bar imports from being released to the market by Customs. Giant said last fall that it had stopped or diverted shipments bound for the U.S. from its Taiwan factories immediately, so no shipments have been held up in Customs. 18 months is not typical — it's short: WROs are relatively rare: The CBP has issued just 27 since 2020. But once imposed, they are not often or quickly lifted. For example, in 2021 CBP imposed an WRO on the Malaysian palm oil and latex glove industries (CBP press release). It took about 18 months before CBP lifted the WRO for some Malaysian glove makers that showed they had eliminated forced labor at their operations. HPS ANALYSIS: Back in April of 2025 Secretary of Commerce Lutnick said in a speech that it was the policy of the federal government to make it as difficult to import goods into the U.S. as possible. This Giant WRO case is an example of the stated policy. WRO cases, as the article points out, are relatively rare and the example sited took “about” 18 months to resolve. Anyone who has been in the bicycle business for any amount of time and participated in importing finished goods from an Taiwanese OEM knows that what Giant did is considered perfectly legal under Taiwanese law, although “customers” do not normally visit or even concern themselves with the housing or treatment of “guest” workers.   

08 04 26: “Retailers — eager for cash — sell off rights to potential tariff refunds.” RETAILDIVE: “A secondary market has emerged for retailers, such as American Eagle Outfitters and The Children’s Place, to get capital quicker by monetizing tariff refunds. Looking for immediate cash, some retailers sold off the economic rights to their potential IEEPA tariff refunds over the past year. A secondary market emerged looking to purchase future refund claims from businesses amid the legal debate over President Donald Trump’s levies imposed under the International Emergency Economic Powers Act, BDO Managing Principal David Wong told Retail Dive.  At a discount on the full value, buyers offered companies cash in exchange for the rights to those potential refunds that could come to fruition if the Supreme Court ruled against those levies. The approach is referred to as tariff refund monetization … Prior to the Supreme Court’s February ruling against those IEEPA-backed tariffs, American Eagle Outfitters in fiscal year 2025 ‘sold a portion of its claims for refunds of previously paid tariffs imposed under the IEEPA’ to a third-party buyer.  The third party bought $68.9 million of the retailer’s refund claims for $18.6 million in cash, according to an American Eagle Outfitters quarterly report from June 3. Since the company began receiving refunds from the government on claims, $33.1 million was paid to the buyer as of the filing date of the quarterly report. American Eagle Outfitters in its Q1 earnings release said it had applied for about $190 million in tariff refunds, with a $140 million anticipated net cash benefit from it. The exact discount at which buyers will purchase the potential refund rights has fluctuated based on whether the deal was initiated before or after the Supreme Court’s ruling, Wong said. Prior to the decision, refunds could be seen trading at 30 to 40 cents on the dollar, or at a 60 percent to 70 percent discount. After the decision was made and a refund process with the U.S. Customs and Border Protection was established, Wong said refunds were seen trading around 60 cents on the dollar.” HPS ANALYSIS: When I first heard about this I admit I was skeptical, but the more I studied this so called “secondary” market, I realized it does represent a source for a loan to a company that needs a source of cash. At the beginning tariff refunds traded at 30 to 40 cents on the dollar, which was for importers of record that were desperate for cash. When the filling got standardized and systematized and the market traded at 60 to 70 cents on the dollar the proposition became more transactional, and I am sure was used by more importers looking for immediate cash. HPS is also reasonably sure that the vast majority of tariff refunds will be booked as earnings and that any large retailer will provide customers with “discounts” on current purchases to pay back a portion of the tariff that was included in previous retail purchases – and that such “discounts” will be few and far between.  

08 05 26: “After deadly e-bike crashes, N.Y. lawmakers consider crackdown.” The New York Times: “New York City legislative leaders on Tuesday announced a long list of proposed rules designed to better govern the use of electric bikes and scooters and crack down on illegal vehicles after a series of fatal crashes. The plan, presented at a news conference outside City Hall, includes 17 bills that the City Council will consider this fall. The announcement begins a long process to shape the proposals, many of which are likely to face opposition from various interest groups, each with its own view of the city’s shared streets. Some of the bills have already been introduced, including ones that would ban the sale of some faster e-bikes that are currently legal; require delivery companies to register for commercial licenses; compel those companies to share more data about drivers’ trips; curtail the use of unregistered mopeds; and support stricter penalties for riders who flee the scene of a crash. Other legislation under consideration would mandate additional insurance for food delivery apps; ratchet up enforcement against lawbreakers and users of illegal devices that can far exceed the 15-miles-per-hour speed limit for e-bikes; and introduce a trade-in program for riders to swap illegal devices with safer ones. Lawmakers will also consider convening a task force to study street design improvements, as well as consider requiring more detailed enforcement statistics from the Police Department. Julie Menin, the City Council speaker, has said the city’s current laws are not being adequately enforced. ‘We cannot wait again for tragedy to strike to become advocates for public safety,’ Menin, said on Tuesday, vowing to run a ‘comprehensive review’ of the city’s e-bike regulations. ‘We owe New Yorkers streets that are safer to bike, safer to walk, safer to drive.’ The Council will hold a hearing about the bills on Sept. 30, where it will question officials from the city’s transportation, public safety and consumer protection departments.” HPS ANALYSIS: This safety issue with electric motorcycles and e-scooters that can exceed 20 miles per hour has overtaken the bicycle industry and, in the case of the State of New Jersey, has cost some specialty bicycle retailers 40 percent or more of their potential 2026 revenue. The city of New York has reported 560 collisions involving e-bikes and 795 involving standup e-scooters through the third week of July. Both figures were up 28 percent from the same period in 2025. At least 20 riders have died in e-bike and e-scooter collisions with motor vehicles so far this year, up from 13 in the same period last year, according to the Department of Transportation. Municipal and state governments are going to continue to throw out the baby with the bath water approach because of the rising body count and the public outcry. There is no question this is a serious and escalating accident, injury, and fatality situation that requires immediate attention by the American bicycle business. A complete, well-crafted and equally well executed safety program is the answer for everyone involved. 

08 05 26: “Bike imports up slightly in first half, as industry develops new sources.” Bicycle Retailer and Industry News: “The number and value of non-electric bikes imported in the first half of 2026 increased slightly over the same period last year, new figures show. And the imported bikes’ country of origin shifted again as the industry hustles to respond to tariff changes amidst queasy market conditions. In dollar value, first-half bike imports were valued at $453 million at Customs, up 1 percent. In units, the U.S. brought in 4.2 million bikes, 7 percent more than in the first half last year, but still putting the U.S on track for a second consecutive year of importing fewer than 9 million bikes. A 5 percent lower average import value per bike explains the disparity between the unit growth and dollar growth. Much of the average decrease came from an 11 percent decline in the value of small kids bikes — a segment dominated by the mass market. Some other bike categories more typically sold in bike shops saw average value increases [see charts and article here]. No e-bikes: The figures do not include e-bike imports, a significant contributor to the dollar value of imports. E-bike import figures are not directly available from government sources, and private estimates vary widely, with LEVA/eCycleElectric estimating that the U.S. imported 2.2 million e-bikes last year, while Bicycle Market Research put the number at 1.3 million. Neither LEVA nor BMR estimates the dollar value of e-bike imports. New sources: The country of origin of bikes continues to shift as the pie charts and table [in the article] show. Most countries saw an increase in the first half compared to the same period last year, except for China and Taiwan. Malaysia, Indonesia and India are rapidly becoming major bike-making nations for the U.S. market, joining Vietnam and Cambodia, which have seen growth in exports to the U.S. for several years now.” HPS ANALYSIS: What this article makes abundantly clear is the total lack of data about e-bike imports. The available estimates are unreliable, and there is no useful data available from the government. While safety has to be the primary issue and outward-facing program, better, accurate data, starting with e-bike import data, has to be close behind. The associations have to make it an absolute priority to lobby the Commerce Department and U.S. Customs and Border Protection (CBP) to establish dedicated Harmonized Tariff Schedule Numbers for e-bikes.

08 05 26: Trump administration pays back $100bn in 'Liberation Day' tariffs to businesses.” British Broadcasting Corporation bbc: “U.S. President Donald Trump's administration has paid back $100bn (£78bn) in ‘Liberation Day’ tariff refunds to businesses through customs officials. This represents roughly 60 percent of all tariff revenue collected by the government under the policy, according to a recent court filing from U.S. Customs and Border Protection. However, a significant chunk of money remains unpaid. Nearly $29bn in potential refunds is undergoing review by trade authorities, while another $1.6bn is stuck because importers have not yet supplied their banking details.

The repayments follow a major Supreme Court decision in February, in which judges ruled that broad import tariffs introduced under economic powers were unlawful.

The White House had cited a 1977 law, the International Emergency Economic Powers Act (IEEPA), which gives the president power to ‘regulate’ trade in response to an emergency. But the measures sparked outcry at home and abroad from firms facing an abrupt rise in taxes on shipments entering the U.S., and worries that the levies would lead to higher prices. Tariffs are taxes on foreign goods entering a country. They are not paid by foreign governments or overseas exporters, but by domestic businesses and importers when goods arrive at customs. Higher tariffs raise upfront business expenses, and companies usually pass these extra costs to shoppers through higher retail prices.

Since the Supreme Court decision, several major American corporations have already claimed large sums back. Amazon received about $600m in refunds during the second quarter, according to finance chief Brian Olsavsky. Olsavsky said on the company's second quarter earnings call that Amazon would pass some money back to customers where specific charges were applied, and the remaining funds would be used to support lower store prices. Under U.S. customs law, only importers who directly paid tariffs can claim refunds, leaving any consumer relief entirely up to individual businesses.

The overall tariffs payout is expected to rise further as U.S. Customs continues to review pending claims and importers update their banking details. After the February court ruling, Trump introduced a 10 percent universal tariff as a temporary solution.

These expired late last month and were replaced by new tariffs on 60 trading partners based on claims that key economic partners have failed to properly tackle forced labour.” HPS ANALYSIS: This gets right down to the nut cutting as my cousin on the farm used to say. The U.S. government has been uncharacteristically efficient and, through August 5, has paid back $100 billion U.S. dollars to Importers of Record (IOR), including IOR’s in the American bicycle business. That is $100 billion that is most likely going to stay inside the IOR’s as revenue, and very little of it is going downstream to customers that paid the companies, brands, and retailers for the tariffs as increases in wholesale and retail prices. HPS is not advocating for the tariff refunds to be doled out, but we are pointing out that the tariffs not only created inflationary retail pricing. They also are responsible for a new form of double-dipping that will inflate some IOR revenue and profitability and downstream through supply chains.

08 06 26: “Accell Group begins insolvency proceedings.” Bicycle Retailer and Industry News: “Nearly six months after securing new investors with the goal of restructuring and reducing debt, Accell Group announced Wednesday that it has started insolvency proceedings. In February, Accell and U.S.-based investment firm KKR announced that Accell secured a new investment, that its major lenders were part of its new ownership group, and that the lenders had agreed to a plan they said would reduce Accell's debt and place it on more stable financial footing. KKR, which led a group that paid $1.77 billion for Accell in 2022, retained no equity in the company after the February transaction. Since then, according to Accell, its advisors have ‘explored every possible avenue for the group's future, including discussions with several interested parties, the consideration of multiple offers, and seeking regulatory approval for a potential merger.’ Accell is the owner of the bike and e-bike brands Raleigh, Haibike, Winora, Ghost, Batavus, Koga, Lapierre, Sparta, Babboe, and Carqon, and the P&A brand XLC. This year, Accell divested two of its brands, selling its titanium frame brand, Van Nicholas, to the Italian cargo brand Velo-ce, and its Nishiki bike brand to Turkey's Kron Bicycle (In the U.S., Dick's Sporting Goods continues to own rights to the Nishiki brand). ’This is a deeply sad and frustrating situation given all the hard work and everything we have achieved, with the support of shareholders and lenders, to restructure Accell's operations and finances,’ Accell CEO Jonas Nilsson said in a statement. ‘It is an especially difficult moment for our employees, creditors, customers, suppliers, and partners. Every realistic option for the future of the business has been tirelessly explored, and none have resulted in a solution to continue the Group in its current form.’” HPS ANALYSIS: I have a friend in the UK who is in our business, and we talk on a regular basis about trends and probabilities. Since last year, we both expected one of the top-tier bicycle brands to bite the dust as a result of changing business and economic conditions. We talked last week, and neither of us expected it would be Accell Group. The ramifications are potentially huge, even for the North American market, from which Accell Group withdrew just before the Pandemic. The biggest potential shift is the one HPS has already disclosed – that is the Chinese turning or shifting strategy from OEM customers to their own distribution – and yes – brands. We also think there is going to be another similar event in North America.     

08 06 26: “NYC warns online retailers about sales, operation of high-speed e-bikes, e-scooters.” Bicycle Retailer and Industry News: “Mayor Zohran Mamdani said Wednesday legal action will be taken against online retailers selling e-bikes, e-scooters, and other motorized devices that exceed speed, weight, or fail to meet other mandatory city safety requirements. The city issued cease-and-desist orders to 42 retailers. Those who continue selling them after receiving an order could face a civil penalty of up to $2,000 for each illegal sale. Illegal devices found operating on New York City streets also could be impounded. It is illegal to sell or operate on New York City public streets:

• E-bikes equipped with motors larger than 750 watts or capable of speeds exceeding 25 mph.

• Motorized stand-up scooters weighing more than 100 pounds or capable of traveling faster than 20 mph.

• Seated mopeds that do not have and display a valid Vehicle Identification Number.

‘Today, we're putting online retailers on notice: If you continue selling dangerous, illegal devices into New York City, you will be held accountable,’ Mamdani said. ‘We will use every tool available to make our streets safer for everyone who walks, bikes, drives or rides. Every family deserves to know that when their loved ones leave home, they will make it back safely. That promise becomes harder to keep when companies profit from knowingly selling illegal, high-speed vehicles that have no place in our city.’" HPS ANALYSIS: It is about time! The City of New York is going to reach out and regulate the online retailers and force them to sell micromobility products that are tested and certified to applicable standards. While not perfect, it is a start toward a level playing field that will also be safer for consumers.

08 07 26: “Employers unexpectedly cut 23,000 jobs in a sign of a wilting labor market.” National Public Radio NPR: “The U.S. labor market softened in July as employers cut 23,000 jobs. Construction companies and factories continued to add workers, but retailers and restaurants shed jobs. The U.S. job market unexpectedly stalled in July. A report Friday from the Labor Department shows that employers cut 23,000 jobs last month, and job gains for May and June were revised sharply lower. The unemployment rate dipped to 4.1 percent, but only because more than 260,000 people dropped out of the workforce. It was the second month in a row that the monthly jobs tally came in weaker than forecasters had expected. ‘We are increasingly hearing from workers that they are anxious about their job security and they are frustrated by the fact that they are stuck in roles that are not necessarily good for them,’ said Daniel Zhao, chief economist at the job search website Glassdoor. ‘And that's on top of workers who are not in a job right now and feel frozen out of the job market.’ Glassdoor's worker confidence index slumped in July to a record low. The Fed's job gets harder: Restaurants and retailers cut thousands of jobs last month and local government also saw large job losses. Healthcare continued to add workers, but at a more modest pace than earlier in the year. The softening job market may complicate the Federal Reserve's job, since it's also battling stubborn inflation. The Fed may be more cautious about raising interest rates at a time when the labor market appears less stable.” HPS ANALYSIS: HPS has expressed its concern about stagflation that includes employment stagnation. Fewer employed Americans mean fewer customers for specialty bicycle retailers. HPS will be watching the employment situation closely and reporting accordingly. 

08 10 26: “Retailers stocked up for upcoming holiday season.” RETAILDIVE: “Data from NRF projects that imports at major U.S. ports have peaked as businesses built up inventory ahead of new tariffs. Retailers are likely well-stocked for the coming holidays as this year’s peak shipping season is coming to an end, National Retail Federation vice president for supply chain and customs policy Jonathan Gold said in a statement Friday. The Global Port Tracker report released Friday by NRF and Hackett Associates found a 13.2 percent year-over-year increase in 20-foot containers or their equivalent at major U.S. ports in June. That’s lower than the industry group’s previous projection of nearly 19 percent growth in June. Additionally, July imports are now expected to be down 7.6 percent year over year, though the Global Port Tracker previously predicted July imports would ‘hit a new all-time record,’ per a press release last month. Ports have not yet reported August numbers, but the industry group projects 20-foot equivalent units at major U.S. ports in August will decrease 4.2 percent year over year. ‘We had an early peak season this year as retailers brought in merchandise ahead of tariff changes in late July and responded to other uncertainties in the supply chain like the ongoing disruption brought by the conflict in Iran,’ Gold noted. ‘One round of tariffs has been replaced with another, but retailers will be well stocked for the coming holiday season. Retailers know how to adapt to shifting situations and are well prepared to meet consumers’ demand for affordability and choice.’ Tariff policies in the U.S. over the past year have altered some of the buying timelines for retailers. A Deloitte study last year found that respondents said they placed over half of holiday orders by the end of May, which was about two months earlier compared to Deloitte’s 2024 survey.” HPS ANALYSIS: This boils down to importers bringing in merchandise early to avoid tariffs if possible. Overall business and imports can be down compared to previous years, and importing retailers will still move up shipments if their cash flow allows it and their lenders approve holding the inventory.

08 11 26: “Accell bankruptcy puts future of major bicycle brands in doubt.” Bike Europe: “The Amsterdam District Court has revoked the suspensions of payments of the Dutch Accell companies and simultaneously declared these companies bankrupt, the two court-appointed trustees announced Tuesday afternoon. The multiple attempts to keep the once giant of the bicycle industry afloat have failed, marking a dark day for the industry with ripple effects that will be felt across Europe. The scramble to secure a future for major brands including Koga, Batavus, Lapierre and Haibike is now underway. The trustees, Thijs Hekman and Erik Schuurs, write that the Dutch Accell companies were unable to meet their ongoing costs. In addition, the European Accell Group is facing a complex situation, with group companies in various countries that are operationally and financially dependent on each other in some respects. KKR and Dutch investor Teslin took Accell private in 2022 in a debt-financed buyout valued at approximately €1.9 billion. But after two debt restructurings, ownership was transferred to the group's super-senior lenders in February 2026. Just six months later, six Dutch Accell entities have been declared bankrupt. The entities listed on the Dutch insolvency register as bankrupt as of 11 August are:

• Accell Duitsland BV

• Accell Global BV

• Accell Group BV

• Accell Group Europe BV

• Accell Group Holding BV

• Accell Nederland BV

The following brands and companies are registered under Accell Nederland BV: Accell Nederland, Batavus, Bikes & More, Loekie, EBSC, Koga, Junker Bike Parts, Sparta, XLC, Lepper Zadels, Accell Western Europe, defietser.nl, Velosophy, Babboe, Carqon, In2Cycling, Bicycle Solutions, Fietspunt.nl, Fietsherstel.nl, Veclo and Bike@Home.

Financial timeline

• 2022: KKR/Teslin acquire Accell → leveraged structure created through 'Sprint' entities.

• 2023–24: Business deteriorates → KKR/Teslin inject additional money.

• Early 2025: First major restructuring → debt reduced to roughly €800m → KKR/Teslin retain control.

• February 2026: Second restructuring → roughly €850m of debt written off → new money → ownership transferred to super-senior lenders.

• August 2026: Lender-controlled Accell cannot meet ongoing obligations → Dutch surseance (suspension of payments) → bankruptcy of six Dutch entities.

Production in Hungary halted: The trustees say they understand that the factory in Hungary, where production was recently centralized, has ceased operations. The Hungarian manufacturing operation, Accell Hunland Kft., is a wholly owned Accell Group subsidiary and had become the group's main European production hub following the transfer of manufacturing from the Netherlands. The factory may itself be one of the most valuable, but also most financially entangled, assets in the group.” HPS ANALYSIS: We have already covered the Accell Group bankruptcy, but we wanted to make sure our readers have access to the important facts, including the timeline.

08 11 26: “Vosper: Why every bike shop should be repairing (almost) every e-bike.” Bicycle Retailer and Industry News BRAIN: “I often hear from retailers about how many calls they get from hub-motor e-bike owners looking for repairs the retailers can't or won't offer. They turn these customers down, and the revenue — along with the customer — is lost forever. Dealers' reasons for refusing bike repairs ‘on brands we don't sell’ are both many and reasonable. Problems take too long to diagnose and are often done on a trial-and-error basis by swapping out parts. Customer service, especially on D2C bikes, can range from sketchy to nonexistent. Parts can be hard to source. And all this is true. But what if your shop could diagnose any e-bike fault in 15 minutes or less and source replacement parts in minutes with a simple internet search? That's what Michael Pasquali's Micromobility Connect company is offering with its Service 2.0 System. It's not just a training course, Pasquali says, but a whole professional diagnostic standard that improves consistency, efficiency, and confidence throughout the service process. I don't normally endorse companies in this space, but I'm prepared to make an exception for Micromobility Connect because it offers such a huge opportunity to benefit the entire dealer base. (And just for the record, they're not paying me to write this piece). Micromobility Connect has provided diagnostic training for companies like Pedego and retailers like the Landry's Bicycles chain. And NBDA board member and former NBDA president James Moore put it this way: ‘If bicycle shops continue to turn away this growing market, there will be others who will set up shop and gladly avail themselves of this growing opportunity. Taking (Micromobility Connect's) e-bike repair training has allowed our business to say yes when we previously said no. And we said no a lot.’ Pasquali says, ‘The overall program is designed to provide technicians with a progressive learning experience that begins with understanding the complete hub-motor e-bike electrical system.’ From there, ‘it advances to a hands-on, structured, repeatable diagnostic process, and culminates by implementing the safety standards and operational practices required to support a modern, professional, and profitable hub-motor e-bike service department.’ What this means for the industry: Ironically, it is precisely those customers who bought cheap e-bikes by mail order who are the most plentiful, and the most likely to have their bikes fail … The upside is simply too great to ignore. The chance for retailers to create fresh service revenue — and, potentially, new customers — from consumers who had formerly been turned away is both huge and growing weekly. And ironically, it is precisely those customers who bought cheap e-bikes by mail order who are the most plentiful, and the most likely to have their bikes fail. Which means they are also the biggest source of potential revenue for savvy, properly trained dealers willing to accommodate them.” HPS ANALYSIS: Another great article from Rick, and we appreciate the fact that he normally would not endorse anyone and that he didn’t receive any remuneration from Micromobility Connect. What Rick is advising is in line with what the NBDA is advising specialty bicycle retailers and what HPS has been advising all year. Specialty bicycle retailers need to expand their service expertise and the service contribution to their total revenue and net pre-tax profit. Rick did his due diligence and researched the facts to support his advice to get the training and education to provide repair services for all types and styles of e-bikes and micromobility products that your insurance company will approve. HPS will take that a step further and advise getting the service training required to provide professional repair service for all types and styles of bicycles, including those sold by mass merchants. The times are changing, and they are changing quickly, and specialty bicycle retailers offer a service for which they can and should receive a profitable revenue stream that no other retailer other than mobile service can offer. So, learn how to repair every product in our wheelhouse, including how to do so profitably. 

08 14 26: “U.S. says dozens of countries helped China dodge Trump's tariffs.” British Broadcasting Corporation bbc: “The White House said in a report on Thursday that more than 40 countries had helped China sidestep U.S. tariffs by routing exports through nations that face lower American import duties.The countries named include Canada, India, Mexico, Japan and South Korea, which the White House said had helped China evade tens of billions of dollars in tariffs, which are levied on companies importing goods. White House trade adviser Peter Navarro said it had cost ‘American jobs and billions in revenue’ .A spokesperson for the Chinese embassy in Washington said ‘trade wars have no winners’ and that it opposes the U.S. tariff measures and the use of state power to target China's companies. ‘Any unilateral actions or agreements concerning transshipped goods must not target or harm the interests of third parties,’ the spokesperson added. The BBC has contacted the U.S. embassies of Canada, India, Mexico, Japan, South Korea and other trading partners listed in the report for comment. The report follows a wave of sanctions between the U.S. and China and comes weeks before U.S. President Donald Trump will meet Chinese leader Xi Jinping in Washington. Between $30bn (£22bn) and roughly $300bn in goods have been moved from countries with higher tariffs through those with lower rates, according to government and private sector estimates quoted by the White House. The process is known as transshipping, which refers to the practice of transferring cargo through another country while en route to a final destination. The U.S. accused China of ‘taking advantage’ of the practice by moving goods through nations that have lower import duties. China has used third countries as a stopover and has repackaged goods to hide their real origin to obtain lower tariffs, the White House said in its report, describing the process as ‘fraud cloaked in paperwork.’ ‘What has changed in today's Great Transshipment Scam is not merely the speed and scale of this modern form of smuggling, but the breadth, depth, and sophistication of the global Shadow Transshipment Network through which China's tariff evasion now moves,’ the White House wrote. The U.S. has deployed artificial intelligence tools to catch transshipment efforts, it added. Bargaining power: The report is expected to add to key sticking points between the sides as Trump and Xi prepare to meet in the U.S. in September, and Chang Pao Li, associate professor of economics at Singapore Management University, said it could be used to strengthen the U.S. bargaining position.” HPS ANALYSIS: We have referenced this article several times in this newsletter, and you can judge the kind of arguments White House trade adviser Peter Navarro is making to support his allegations of China sidestepping U.S. tariffs by routing exports through nations that face lower American import duties. By the way, the allegations, as far as HPS knows, are true. The trade adviser is doing everything he can to sensationalize arguments against the trade practices that Chinese companies have been employing before the Trump tariffs came into being to reduce costs and gain access to markets. The USTR also knows that the allegations in the White House report are true and we now have to wait to see what the findings about Structural Excess Capacity are, and if the USTR and the Administration will stick to the 20 percent import tariff cap the PRC says they agreed to earlier in the year, or will plunge into a trade war with a significant source country for bicycles and e-bikes. 

08 14 26: “Fundracer Partner René Wiertz: Investors prioritize companies with clear paths to profit.” Bike Europe: “For Fundracer Partner René Wiertz, the next decade will not simply be about selling more bicycles; it will be about making two-wheel mobility dramatically safer, smarter and more connected. ‘Those companies enabling that transformation are likely to create the greatest long-term value,’ says Wiertz. Bike Europe asked him about the market outlook from the perspective of an investment fund manager. How did the bicycle/e-bike market perform in your opinion in the first half of 2026?The first half of 2026 could be regarded as the beginning of a healthy reset rather than the start of another boom. After almost three years of inventory corrections following the COVID-driven surge, most markets are finally approaching normal inventory levels. Overall, I would characterize H1 as a transition period where profitability has become more important than volume growth. The e-bike segment remains the industry's main value driver, although unit growth has slowed considerably. The strongest companies today are those with healthy balance sheets, differentiated products and disciplined inventory management. Chinese players are aggressively entering or expanding. What trends do you see in the market for investments in relation to the bicycle and e-bike industry? Investors have fundamentally changed how they look at the industry in my opinion. Five years ago, investors were largely funding bike brands. Today, they are far more interested in technology platforms that enable the future of micromobility. The areas attracting the most interest include active safety technologies such as ABS, airbags and AI-powered collision avoidance. The other businesses we closely monitor are software, connectivity, and fleet management, as well as battery technology and energy management, advanced manufacturing and automation, and finally circular economy solutions and sustainable materials. At Fundracer, we don't see ourselves as investing in bicycles; we invest in the technologies that will define the future of two-wheel mobility. The other clear trend is that capital has become much more selective. Investors now prioritize companies with clear paths to profitability rather than businesses pursuing growth at any cost. Strategic investments are also increasing, illustrated by recent investments into Brompton by Decathlon Pulse and BA Capital. What are the most important market indicators for you to track the bicycle and e-bike industry? René Wiertz outlines five indicators that clearly mark how the market is developing. These are:

• E-bike share of total bicycle sales

• Average selling prices rather than unit volumes

• Bicycle leasing adoption across Europe

• Urban cycling infrastructure investments

• Venture capital activity in mobility technology

What do you consider to be the biggest threat to the bicycle industry? In my view, the biggest threat is commoditization. The bicycle industry has historically been very good at engineering products but less successful at building meaningful technological differentiation. As more manufacturing shifts to Asia and product specifications become increasingly similar, price competition intensifies and margins suffer. Another concern is that innovation has not kept pace with consumer expectations. Today's consumers increasingly expect bicycles to offer the same levels of connectivity, safety and intelligence that they experience in automobiles. What do you consider to be the biggest opportunity for the bicycle industry? The biggest opportunity is that the bicycle is no longer just a sporting product; it is becoming a core element of urban transportation. This opens an entirely new addressable market. Over the next decade, I expect bicycles and e-bikes to become increasingly integrated with technologies that originated in the automotive industry. Features such as ABS, airbags, AI vision systems, radar, connected services and predictive maintenance will become standard on premium two-wheelers. At the same time, trends such as bicycle leasing, subscription models, corporate mobility programs and investments in cycling infrastructure continue to make cycling more attractive for daily transportation. For investors, this creates an opportunity that extends well beyond bicycles themselves. We see a rapidly expanding micromobility ecosystem in which technologies developed for one vehicle category can often be applied to bicycles, scooters, motorcycles, and other light electric vehicles. That is why I believe the next decade will not simply be about selling more bikes, it will be about making two-wheel mobility dramatically safer, smarter and more connected. Those companies enabling that transformation are likely to create the greatest long-term value.” HPS ANALYSIS: I was introduced to Rene Wiertz several years ago and was and continue to be impressed with both his knowledge of innovation in the global bicycle industry and his intellect. I recommend HPS readers go to Bike Europe, and if they haven’t already read this whole article, that they do so, and also file it for future reference. Bike Europe asks Rene Wiertz a series of questions about investing in the bicycle sector and what the future holds. Accordingly, Wiertz thinks that today’s investors are more interested in technology platforms that enable the future of micromobility. The areas attracting the most interest include active safety technologies such as ABS, airbags and AI-powered collision avoidance. When asked what the most important market indicators are for the bicycle and e-bike industry, Wiertz has at the top of his list “E-bike share of total bicycle sales” – a metric the American bicycle industry does not have a clue about. 

08 14 26: “U.S. retail sales slump unexpectedly and sharply after a summer tax-refund boost fades.” Associated Press: “After splurging on the World Cup and Amazon Prime Day sales, Americans unexpectedly cut their spending in July by the biggest amount in more than a year. Retail sales fell 0.6 percent last month, marking the biggest decrease since May 2025, compared with a revised gain of 0.2 percent in June, according to the Commerce Department data released Friday. Economists were projecting a small increase. The decline followed a notable bump in spending in both April and May as Americans dipped into their government tax refunds. The drop in spending for July, however, raised concern among some economists about the resiliency of consumers who have powered the economy forward despite nagging inflation and soaring gasoline prices. Yet, it may be too early to declare a retreat by one of the strongest and most consistent forces in the U.S. economy of late. Still, the weak sales report follows unexpectedly sluggish jobs figures last week, and both suggest the economy could be slowing after strong consumer and business spending in the first half of the year. Separately, consumers turned more pessimistic about the economy this month, likely driven by stubbornly high prices, according to the University of Michigan’s consumer sentiment index, released Friday. While most economists still expect solid economic growth in the July-September quarter, many have lowered their forecasts in the wake of the retail sales report … Gas prices have been rising since the final week of July and ticked higher again overnight to $4.08 per gallon, up from $3.85 a month ago, according to motor club AAA. That’s 92 cents more per gallon than Americans were paying last year at this time. Gas prices typically begin to recede in August as the driving season comes to a close, and the AAA said this week that the high cost of fuel for Americans this late in the year is unprecedented. Excluding sales at gas stations and auto dealers, retail sales in July fell 0.2 percent … ‘American consumers are showing signs of fatigue,’ Heather Long, chief economist at Navy Federal Credit Union, wrote Friday. ‘July retail sales were disappointing on all levels.’ HPS ANALYSIS: This article leads with the news that Americans unexpectedly cut their spending in July by the biggest amount in more than a year. Retail sales fell 0.6 percent last month, marking the biggest decrease since May 2025, compared with a revised gain of 0.2 percent in June, according to the Commerce Department data. This, combined with the other economic reports and data contained in this month’s HPS Bicycle Business Reporter, leads HPS to issue a warning to its clients and specialty bicycle retailers to carefully watch expenditures and cash flow and focus on inventory turn and profitability. Revenue is important to maintain at forecast levels along with not allowing pre-tax profit margin to erode below plan. 

08 15 26: “China rattled by Trump White House chaos weeks ahead of Xi visit. It has happened before.” South China Morning Post: “Sources say little progress has been made on deliverables for Xi Jinping’s first state visit to the U.S. since 2015. Just months ago, disorganized planning from Washington in the lead-up to U.S. President Donald Trump’s landmark China visit frustrated Chinese officials. Now, Beijing is watching the same story play out on the other side of the world. With less than six weeks until Chinese President Xi Jinping’s planned trip to Washington – his first state visit since 2015 – Beijing finds itself increasingly unsettled by the chaos within the Trump administration. Sources told the South China Morning Post that Chinese officials were once again confronting a disorganized Trump administration that lacked planning and coordination, with little progress made on hammering out deliverables for the leaders’ summit. This time, according to the sources, the anxiety runs deeper as the summit will take place on foreign soil. One person with knowledge of the preparations said that no U.S. official or agency had thus far assumed responsibility for organizing the visit, leaving officials on both sides largely engaged in routine preparations without clear leadership. As was the case with Trump’s trip to Beijing, when the Treasury Department and U.S. Trade Representative played the central roles, the State Department has so far remained largely uninvolved. The source added that the recent Washington trip by China’s foreign vice-minister Ma Zhaoxu produced a brief improvement in the atmosphere, but that momentum had not been sustained. The official Chinese read-out of the visit said only that Ma held in-depth exchanges with senior U.S. officials. Two people familiar with the thinking on the Chinese side suggested the issues appeared operational, logistical and optics-related, as neither side had high expectations of achieving anything substantive from the September summit. The only concrete item on the agenda being discussed is a roughly US$30 billion tariff reduction for Chinese goods as a targeted concession. Chinese officials are particularly sensitive to the dynamics because protocol, venue and public messaging will be largely controlled by the White House, leaving Beijing with less ability to manage the optics or limit surprises. Sources attributed the slow practical planning to internal deliberations within Trump’s inner circle, where disagreements persist over the tone and framing of the visit. White House advisers like Stephen Miller and Steven Cheung are pushing Trump to project superiority, while others expect the U.S. leader to ease things over with Xi. All sources spoke on condition of anonymity because they were not authorized to comment publicly on the matter. Trump earlier floated September 24 as the date for Xi’s White House visit, with U.S. Secretary of State Marco Rubio last month indicating that the visit remained on track.” HPS ANALYSIS: Keeping in mind that the South China Morning Post is an organ of the PRC, HPS believes from its own research that there is genuine concern on the part of Chinese officials about the apparent lack of detailed preparation on the part of the U.S. for the pending September visit to Washington of the President of China. The Chinese believe the devil is in the details, and they also are more comfortable if agreements are reached and documented before the meetings and formal negotiations occur. What they are seeing through their Ambassador in Washington is the recent White House release of the trade advisors’ report of allegations, true or otherwise, of more than 40 countries helping China sidestep U.S. tariffs. China also sees turmoil and apparent confusion about a number of geopolitical issues. HPS believes that China will come to the table in Washington in September with a strong hand and the probability of success, including the 20 percent tariff cap is probable, but there is still a little over a month before the presidents of the U.S. and China meet in Washington, and in today’s world a lot can both happen and change in a month. 

08 17 26: “U.S. consumer sentiment slides in August, ending recovery.” Sporting Goods Business SGB: “University of Michigan’s consumer sentiment survey fell for the first time in three months as households worried about worsening inflation and deteriorating business conditions. The university’s preliminary August sentiment index decreased to 51 in August, according to the survey released Friday, from a final reading of 55.2 in July. The median forecast from a Bloomberg survey of economists had projected a reading of 55. The index is down 12.4 percent year over year but remains above the recent lows reached in the spring, when gasoline prices were soaring. Surveys of Consumers Director Joanne Hsu said, ‘Consumer sentiment fell about eight percent this August, ending two consecutive months of improvement. While views of personal finances saw only minor declines, expected business conditions sank 11 percent for the short run and 17 percent for the long run. Decreases in sentiment were seen across the political spectrum, with Republicans exhibiting the strongest month-to-month decline in August. Sentiment among Republicans is now 19 percent below readings just prior to the Iran conflict and the lowest since the 2024 election. Although the early-month weakening in sentiment was pervasive across various demographic groups, notably large reductions were seen among older consumers, lower-income consumers, and those without a college degree. These groups are all particularly vulnerable to any erosion of purchasing power stemming from inflation. Across all consumers, only eight percent expect their income growth to exceed inflation in the year ahead, down from 18 percent in December 2024, a reflection of the belief that high prices will continue to be burdensome.” HPS ANALYSIS: The economic news has slowly gotten worse as the last weeks of July progressed into the first weeks of August. The University of Michigan consumer sentiment survey fell for the first time in three months as households worried about worsening inflation and deteriorating business conditions. HPS has already issued its warning and advises clients, readers of this newsletter, and specialty bicycle retailers to exercise caution to make sure financial planning and projections are current and reflect current economic and market conditions.

Contact Jay Townley: jay@humanpoweredsolutions.com