Dont some of the bikes already get made in the USA? the higher end ones? maybe if they can expand their factories and the workforce in the US, that will help them develop some efficiencies in the factories and by importing larger quantities of materials. one thing we will see less of is cheap china bikes. they'll be subject to higher taxes & shipping is already high.

Well... a lot of industries and US companies are hearing similar things. If the only thing the US government did was to impose massive import tariffs, that would probably end in disaster. We have some relevant experience there with Smoot-Hawley. However, if it is part of a bigger picture, like reducing the massive health insurance cost burden imposed on US-based employees, eliminating corporate taxes that penalize domestic manufacturing and weaken international competitiveness, and negotiating offsetting international trade agreements, then it might be OK.

And an aside, the president does not actually have the constitutional power to set a tariff. Only congress can do that, unless congress granted the president a back door.

That was one of the poorest written, least researched and supported article I have seen in a quite a long time. Obviously they have quite an agenda, and I know for a fact that John Burke does. I will never get those few seconds back, and my brain is a bit dumber after reading that.

It might ramp up the cost of American brands due to the potential increase in production costs if they to be built in the US, but I can't see how in the gloabalised world it would significantly affect the price of a giant for example in any market other than the US.

I can't see trek or any other American brand shutting down Far East manufacturing for cheap bikes (and probably expensive bikes) to be sold to markets other than the US.

Having said that who knows what is going to happen.

wow. a potentially interesting topic. horrible article.

the idea at the base of it is pretty simple: if tariffs go up on imports from Asia, and you're importing all the bikes from Asia, yes, they're going to get more expensive. It will make it easier for US manufacturers to compete, at least theoretically. but it could also lead to people buying fewer bicycles.

while this is hypothetical and the article was poorly written, if companies were 'forced' to bring all production to the U.S. this action would have the unintended consequence of accelerating the pace of automation coming to the carbon fiber layup process, which is inevitable. This would ultimately decrease workforce requirements. the administration should probably consult a bit more with economists and rely a little less on gut intuitions.

---

wovebike.com | Wove on instagram

Gotta agree here....struck me as quite a bit of fear-mongering and hysterics.

And I am hardly a fan of Trump, so it pains me to even appear to be defending him, but that article ain't worth much.

---

Chicago Cubs - 2016 WORLD SERIES Champions!!!!

"If ever the time should come, when vain and aspiring men shall possess the highest seats in government, our country will stand in need of its experienced patriots to prevent its ruin." - Samuel Adams

I think if the USA had the facilities and know-how to produce bicycles and components - much like HED has already begun doing up in Minnesota, it would be a great thing for the USA bike market. But building the kind of bike mfg. infrastructure that Asia has isn't going to happen overnight. So I'm anticipating that if Trump enforces tariffs, it will have a short-term impact (maybe 5 years?) on the price of bikes.

As an American, I'd have to answer "yes" to that question. Especially if there was a decent American company standing behind and supporting the product.

I also think John Burke, CEO of Trek picking a fight with Trump via the Huffington Post is a pretty foolish thing to do as well. I'm anticipating the price of Treks will be going way up, or we'll be seeing some repentance like we've seen from Ford Motor Co.

It makes no sense economically. If Trek bikes somehow get to be manufactured in the US, the cost to Trek goes up and thus the MSRP goes up, and the unit movement would go down. If there were tariffs on bikes not manufactured in the US in order to boost bikes made in the US, the US manufactures would suffer from the corresponding tariffs on exports their bikes to other countries.
The real world evidence on this is not controversial, every economist agrees that protectionism does not work.

If people are willing to pay more(much more in this case) for the same thing because it is made in the USA, then no incentives would be needed and companies would still produce here. But people in general simply are not willing to do that in general.

There is also the issue that Taiwan and China have the best bike factories in the world.

Exactly this....instituting massive tariffs would be devastating to the economy. Prices escalate, consumption decreases and access to overseas markets is closed.

/thread

---

Chicago Cubs - 2016 WORLD SERIES Champions!!!!

"If ever the time should come, when vain and aspiring men shall possess the highest seats in government, our country will stand in need of its experienced patriots to prevent its ruin." - Samuel Adams

Much of today's products, bikes included, are priced to market. At $600+, Apple makes a nice profit on the iPhone. If Apples cost of manufacturing goes up due to relocating here, they either stop making the phone or they continue making it, and just make less profit. But it will still be priced at what the what the market with consideration given to the competition. I think this is called, mark to market. It will be the same with bikes. It might affect sales a little, but it also increased the jobs here and there is follow business from having manufacturing here.

In some cases, especially with high volume items, I think what will see some of the foreign (Taiwan, China, etc) companies that have an infrastructure in the far east will start installing one here, and the products will still be made under contract. That is what Foxconn is doing, hence their large capital investment that they just announced. Apple isn't going to make products here, Foxconn is.

I totally agree. Foxconn has started, and it look like Alibaba is also establishing a presence. Pretty smart to get facilities here to avoid the soon to come tariffs.

But they are going to be automated facilities employing just a few engineers to tend to the robots....

If you've ever seen an Amazon facility, you would know better. Lots of jobs, and even if as you suggest, more tax dollar revenue.

That is the thing, politicians are chasing the wrong boogeyman. The vast majority of factory jobs are and will be lost to automation and technology. Higher prices (via fair trade) and higher minimum wages are just going to further usher in this era. In the not so distant future it will be cheaper to automate than pay someone a wage. When that tipping point happens a lot of unskilled jobs are going to disappear very quickly.

It already has reached that tipping point for U.S. wages.

The biggest set back to Trump and the bike industry may be a loss of Federal funds towards alternative transportation. Make the country less bike friendly and watch a flat industry right now start a downward spiral.

While I agree with other posters that the article is weak, the topic is interesting. It got me thinking more about the economic implications for americans of US manufacturing vs overseas manufacturing, and what it was exactly that got trump elected as president.

What you wrote above is true, protectionism is in general a negative in rational economic terms. But there is a bit of a problem: humans, especially when making economic and political decisions, are far from rational.

So, yes, free trade means that, among other things, consumers benefit economically, as 95% of what we buy gets a little bit cheaper which means that there is a huge economic benefit when it is all added up among all of the people that get the benefit (the vast majority, if not all, of the US population). But, free trade also means that, in spite of cheaper prices and other benefits, a non-trivial number of people are thrown out of work, or lose well paying jobs and now have to work at much lower paying jobs. But, in purely rational terms, that economic loss is still far less than the economic benefits of free trade.

But, since humans are not rational, as a whole, our US population feels the pain of job/wage loss far more than the benefit of slightly better prices for everyone across the board. And that feeling of pain, while perhaps not rational in economic terms, is how the voters got us to where we are (politically) today.

Or, at least, this is my theory, but I'm not by any stretch an economist.

(On a compete side note, we do happen to manufacture in the usa, so, trump or no trump, we'll keep on doing what we always have ... )

---

Advanced Aero TopTube Storage for Road, Gravel, & Tri...ZeroSlip & Direct-mount, made in the USA.
DarkSpeedWorks.com.....Reviews.....Insta.....Facebook
--

Assume the average cost of a carbon bike frame is less than $500; with $400 of that direct material and $100 direct labor. The difference between what you pay -- say $3,500 -- goes to R&D, marketing, distribution, and profit. All but the direct labor is most likely already done in the US.

Even if the cost of direct labor doubles, the end cost to the consumer shouldn't, in theory, be much. Also, other than high-end Toray fiber, most carbon is already manufactured in the US.

But I'm assuming the bike manufacturers will use your concern as an excuse to raise prices... which they probably will be able to do successfully if tariffs go up on imported frames.

On the bright side, 'Merica WILL be great... again!

It seems to be working pretty well for China.

Amazon is a retailer. But the company is also invested in robot technology.
https://www.bloomberg.com/news/articles/2016-06-29/how-amazon-triggered-a-robot-arms-race


Looking to Germany will tell us a lot about how manufacturing will look like, skilled workers and automation.
Technology, code and robots will be the new worker.

"or they continue making it, and just make less profit."

This is the funniest thing I've read all day.

---

***

Yup. You know what they've figured out? Labor isn't expensive anymore because you can just use robots. Might as well locate manufacturing close to one of your largest markets. Proximity to cheap electricity doesn't hurt either.

I see an opportunity for 3rd party manufacturers to contract to various companies to move a portion of their manufacturing to the US and leaving some in Taiwan for the rest of the global market.

---

___________________________________________
http://en.wikipedia.org/...eoesophageal_fistula
http://en.wikipedia.org/wiki/Cerebral_palsy
2020 National Masters Champion - M40-44 - 400m IM
Canadian Record Holder 35-39M & 40-44M - 200 m Butterfly (LCM)