Giant expands production capacity in China
Posted by By Gary Roethenbaugh at 12 January, at 00 : 00 AM Print
Leading global bike producer Giant Manufacturing is reportedly expanding its total annual production capacity to around 5 million bikes for 2010 – boosted by a US$15 million (€10.5 million) investment in a new facility situated in Kunshan City, in China’s Suzhou province.
According to the Taiwan Economic News, the new facility shall extend over 500 acres, producing bicycle frames and forks, with bike assembly coming on stream. Construction on the new site shall start in the first half of 2010.
The investment comes amidst a difficult period for Taiwan’s bike firms. Many Taiwanese industry executives expect little or no sales growth in 2010 as the industry continues to battle the ripple effects caused by the global economic recession.
Both Giant Manufacturing and rival Merida saw 2009 monthly sales revenues decline on 2008. Although, 2008 was an exceptional year for both companies – with both Giant and Merida posting double digit growth on 2007.
The combined challenges ahead – of depressed consumer spending levels, low consumer confidence into 2010 and high stock inventories are now facing key Taiwanese operators such as Giant, Merida and privately held Ideal Bike Corp.
Investment into emerging growth areas such as e-bikes is expected to continue. Coupled with this, bike manufacturers were able to increase average bike unit prices in 2009. Increased innovation to improve the performance of mid-priced bikes and lower volume/higher priced bikes may be a likely area of focus into 2010.
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