Tariffs and Trade: A Quick Bike Frame Trade Supply Chain Guide

The world has recently gone a little bit haywire, and many people talk of tariffs and how they affect bike manufacturers. I thought it might be a good idea to break down the logistics of the bike supply chain into an easy-to-understand guide to help you separate fact from fiction.

Raw Materials: The Foundation of the Frame

Types of Materials Used

The journey of a bicycle frame begins with selecting and extracting raw materials. The most common materials used in frame production include:

• Aluminium Alloys: Popular for their light weight and corrosion resistance. Typically, 6061 or 7005 series are used.
• Carbon Fibre: Favoured for high-performance bicycles due to its strength-to-weight ratio and stiffness.
• Steel: Known for its durability and comfortable ride quality. Variants include chromoly (chromium-molybdenum) and high-tensile steel.
• Titanium: Lightweight, corrosion-resistant, and exceptionally strong, albeit more expensive.

Mining and Refinement

Each material has a specific source:

• Bauxite, the ore for aluminium, is mined in countries such as Australia, Guinea, and China. The refining process yields alumina, which is smelted into aluminium.
• Iron ore, for steel, is predominantly mined in Australia, Brazil, and Russia.
• Titanium is derived from rutile and ilmenite ores, processed into titanium sponge before alloying.
• Carbon fibre is synthetic, created from polyacrylonitrile (PAN), and produced largely in Japan, South Korea, and the USA.

These raw materials are often processed into usable industrial forms like tubes, sheets, or carbon fabric rolls before being shipped to frame manufacturers.

Material Suppliers and Component Manufacturers

Aluminium and Steel Tube Producers

Raw metals are transformed into bicycle-specific components by industrial tube manufacturers. Notable companies include:

• Columbus (Italy) and Reynolds (UK): Renowned for producing high-quality steel tubing.
• Hydro Aluminium (Norway) and Alcoa (USA): Major suppliers of aluminium used in bike frame production.

These tubes may be drawn, butted (made thinner in the middle), and heat-treated for strength and performance. They are then sold to bicycle manufacturers or OEMs (Original Equipment Manufacturers).

Carbon Fibre Fabricators

The carbon fibre industry is more vertically integrated. Leading suppliers include:

• Toray Industries (Japan) – supplying carbon fibre to brands like Trek and Specialized.
• Hexcel (USA) and Mitsubishi Chemical (Japan) – also major players.

Carbon fibre sheets are often custom pre-impregnated with resin (pre-preg) and delivered in rolls to manufacturing facilities for frame layup and moulding.

Frame Fabrication: Manufacturing the Structure

Global Manufacturing Hubs

Most bicycle frames are manufactured in Asia, where skilled labour and industrial infrastructure make production cost-effective. Key regions include:

Taiwan: The Global Bike Factory

Taiwan has earned a reputation as the bicycle world’s “Detroit,” with vertically integrated operations, high-end manufacturing, and a skilled workforce.

Key companies:

• Giant Manufacturing Co.
• Merida
• Ideal Bike Corporation

Taiwanese firms often subcontract to facilities in Vietnam and Cambodia for lower costs while maintaining control of quality.

China: Scale and Efficiency

China handles mass-market frame production. Cities like Shenzhen, Tianjin, and Shanghai house major factories.

While sometimes perceived as lower-quality, many top brands rely on Chinese facilities for budget-friendly lines, with stringent QC measures.

Vietnam and Cambodia: Rising Stars

Driven by tariffs on Chinese imports and EU trade agreements, Vietnam and Cambodia are gaining traction.

Cambodia, for example, is now the EU’s largest bicycle supplier due to its Everything But Arms (EBA) trade privilege.

High-end carbon and steel frames may be hand-crafted in boutique facilities in Europe or the United States, but the bulk of global production remains concentrated in Asia.

Logistics and Transportation

International Freight

Once manufactured, frames are shipped to distributors or assembly plants:

• Sea Freight is the most common and economical for bulk shipments.
• Air Freight is used for urgent or high-end components.

Shipping routes often start in Asia and move towards Europe or North America. For UK-bound frames, they typically arrive via the Port of Felixstowe or Southampton.

Import Duties and Tariffs

The UK imposes tariffs on bicycle components, depending on trade agreements. Post-Brexit regulations have introduced new complexities, particularly for shipments routed through the EU.

Cambodia and Vietnam benefit from preferential trade agreements, making them attractive sources for UK brands.

The Role of Governments and Trade Policies

The bicycle industry, and particularly the frame manufacturing segment, operates within a highly regulated and geopolitically sensitive framework. Governments and trade organisations influence the supply chain at virtually every stage,from raw material access and labour laws to export incentives and anti-dumping regulations.

Understanding how state and supranational bodies shape the global flow of bicycle frames is critical for businesses operating in this space. These influences may manifest as policy decisions, regulatory frameworks, infrastructure investment, or broader diplomatic arrangements. In an increasingly globalised but geopolitically fragmented world, the implications of trade policies are more potent than ever.

Trade Agreements and Tariff Structures

Tariffs and trade agreements dramatically shape where bicycle frames are produced and where they are sent for assembly and sale. These instruments can offer economic advantages, protect domestic industries, or even serve strategic geopolitical interests.

Key Trade Agreements Impacting the Bicycle Industry:

• EU–Vietnam Free Trade Agreement (EVFTA):
  Signed in 2020, this agreement eliminates virtually all customs duties between Vietnam and EU member states. Vietnam has quickly capitalised on this, with many OEM bike frame suppliers establishing or expanding operations there.
• Everything But Arms (EBA) Initiative:
  Cambodia enjoys duty-free access to the EU under this scheme, boosting its status as a leading exporter of complete bicycles and frames. However, recent concerns around human rights abuses have led the EU to revoke some trade preferences, increasing uncertainty for buyers reliant on Cambodian manufacturers.
• US–China Trade War and Section 301 Tariffs:
  The imposition of punitive tariffs on Chinese-made bicycles and components (including frames) has disrupted traditional sourcing strategies. Many companies have shifted production to countries like Vietnam, Taiwan, and Bangladesh to avoid the added costs.
• UK Post-Brexit Trade Framework:
  Following Brexit, UK businesses lost access to the EU’s unified customs area. This necessitated new documentation (such as certificates of origin) and imposed added complexity. In some cases, bike frames imported to the UK are now subject to duties that didn’t apply before. However, new trade deals,such as the UK–Japan and UK–Australia agreements,offer alternative sourcing routes.
• RCEP (Regional Comprehensive Economic Partnership):
  The RCEP agreement,comprising China, Japan, South Korea, Australia, New Zealand, and ASEAN nations,facilitates regional trade by reducing tariffs. For bicycle frame manufacturers in Asia, this creates a tightly integrated supply network that can serve global markets efficiently.

Anti-Dumping Laws and Protective Measures

Anti-dumping duties are imposed when countries believe foreign manufacturers are selling products below fair market value to gain competitive advantage. This has directly affected the bicycle frame market on several occasions.

Notable Cases:

• EU Anti-Dumping Measures Against China:
  The European Union has long enforced anti-dumping duties on Chinese bicycles and components to protect domestic producers. These measures have been in place since 1993, with multiple renewals. As a result, Chinese-made frames are subject to heavy tariffs when imported into the EU, incentivising EU-bound production to move to non-restricted countries like Taiwan, Bangladesh, and Cambodia.
• India’s Import Duties:
  India, with a growing middle class and increasing cycling popularity, has also considered protective tariffs to nurture its local bicycle manufacturing industry. This affects global players looking to enter India with complete bikes or frames.

Localisation Incentives and Industrial Clustering

Some governments offer incentives to promote local frame manufacturing, or to encourage foreign investment in bicycle-related industrial clusters.

Examples:

• Taiwan Bicycle Valley Initiative:
  The Taiwanese government has invested heavily in infrastructure and R&D through the “Bicycle Valley” programme centred in Taichung. This has attracted global brands and fostered a complete ecosystem of frame, component, and accessory suppliers.
• India’s Production-Linked Incentive (PLI) Scheme:
  Although currently targeted at electronics and pharmaceuticals, the government is considering extending PLI to bicycle manufacturing, including frame production. This would involve tax rebates and subsidies for local production capacity.
• Indonesia and the Philippines:
  Both countries have expressed interest in becoming future OEM bases. Government-backed export processing zones, reduced corporate tax rates, and land subsidies aim to attract foreign manufacturers.

Taxation and Compliance

Frame suppliers and brands must navigate a variety of taxation issues, from VAT to import duties. Non-compliance can result in fines, border delays, or even seizure of goods.

Examples:

• EU’s Dual VAT on Imports and Local Sales:
  When frames are shipped from Asia to EU warehouses and then sold across borders within the EU, brands must handle intra-community VAT rules,complex, especially for DTC brands.
• UK’s Post-Brexit VAT Changes:
  Import VAT is now levied at the point of entry into the UK. For frames or complete bikes over £135, sellers need an EORI number and must declare the goods properly, or face customs hold-ups.

Environmental and Safety Regulations

As sustainability becomes a policy priority, many governments are instituting regulations that affect frame materials, production processes, and disposal practices.

• EU Eco-Design Directives:
  Though currently more relevant for electronics and appliances, future iterations may include consumer sports goods, especially if they include electronics (e.g., e-bike frames). The EU is already piloting “product passports,” which track the environmental impact of goods.
• RoHS and REACH Compliance:
  These regulations restrict hazardous substances in products and manufacturing processes. Frame coatings, resins in carbon fibre production, and metal finishing processes all fall under scrutiny.
• Extended Producer Responsibility (EPR):
  Countries like France and Germany are pushing for EPR schemes where manufacturers must take responsibility for end-of-life product disposal or recycling. This will soon impact frame design and choice of recyclable materials.

Labour Laws and Ethical Sourcing Regulations

Ethical labour practices are becoming a trade requirement, particularly in the EU. Governments are increasingly holding companies accountable for human rights conditions in their supply chains.

Key Developments:

• German Supply Chain Act (Lieferkettengesetz):
  Mandates that large companies must ensure no human rights abuses (including forced labour or poor working conditions) exist within their entire supply chain, even if outsourced.
• EU Corporate Sustainability Due Diligence Directive (CSDDD):
  This proposed legislation will require all large companies operating in the EU to conduct environmental and human rights due diligence across their global supply chains,including frame manufacturers in Asia.
• US Uyghur Forced Labour Prevention Act:
  While mainly focused on textiles and electronics, the law empowers US customs to detain imports suspected of forced labour,potentially impacting components sourced from certain regions of China.