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Re: Trump and the bike industry ? [DBF] [ In reply to ]
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DBF wrote:
every economist agrees that protectionism does not work.

protectionism doesn't work for the overall economy, at least according to economists, who must know something.
but even if the cons outweigh the pros, it still has winners and losers.

besides, soon we'll be winning so much we'll be tired of winning. we'll all have carbon fiber American-made bikes and anyone who spells it 'fibre' will be deported.
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Re: Trump and the bike industry ? [Bob Loblaw] [ In reply to ]
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Bob Loblaw wrote:
DBF wrote:
every economist agrees that protectionism does not work.

protectionism doesn't work for the overall economy, at least according to economists, who must know something.
but even if the cons outweigh the pros, it still has winners and losers.

besides, soon we'll be winning so much we'll be tired of winning. we'll all have carbon fiber American-made bikes and anyone who spells it 'fibre' will be deported.

There doesn't seem to be much of an acknowledgement of the effect of other countries reciprocating. I can image Boeing losing a multi-billion dollar order to Airbus over some stupid dispute over trade. These things make bike parts look pretty trivial. The funny thing is that US agriculture probably stands to lose the most and they overwhelmingly voted for the Donald. The Pacific rim is a huge potential export market for beef and pork, but you don't think they will feel like buying from the US if they are getting screwed.
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Re: Trump and the bike industry ? [DarkSpeedWorks] [ In reply to ]
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Human behavior is incredibly rational and predictable given a basic understanding of the 'rules of the game'. Make a three pointer in basketball worth 10 points and prepare to witness behavior changing in a very predictable way. This is all the more evident in consumer behavior. Case in point, the vast majority of consumers on this board openly admit to buying their components from online retailers at a fraction of the price of their LBS, even though they know that this behavior may ultimately lead to the demise of their local shop. They know they really should support their LBS, but there is a very predictable tipping point at which the consumer says they are not willing to pay a premium above X %. You can argue that the consumer is behaving irrationally for taking the short term gain in lieu of the long term health of their local economy, but that doesn't mean the consumer isn't acting in a rational and very predictable way.


DarkSpeedWorks wrote:
DBF wrote:
The real world evidence on this is not controversial, every economist agrees that protectionism does not work.


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 ... )
Last edited by: chrisgrigsby: Jan 23, 17 21:44
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Re: Trump and the bike industry ? [grumpier.mike] [ In reply to ]
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Entry-level bike prices will go up immediately and for quite a while, as corps will try to figure out how to keep profit margins for the 1%, while building all those high wage assembly lines/facilities.

Meanwhile everybody will just have to take out a loan to buy a Triathlon bike, but the Don promised us the paradise is just around the corner and we just should suck it up a little...just long enough to make them lending us their money worthwhile.

Sounds good to me...won't be buying a bike for 4 years, probably will have to take out loan anyway to just buy food or shelter. Bikes are really just a luxury item and more pressing are the same developments happening in more essential area of life.


grumpier.mike wrote:
Bob Loblaw wrote:
DBF wrote:
every economist agrees that protectionism does not work.


protectionism doesn't work for the overall economy, at least according to economists, who must know something.
but even if the cons outweigh the pros, it still has winners and losers.

besides, soon we'll be winning so much we'll be tired of winning. we'll all have carbon fiber American-made bikes and anyone who spells it 'fibre' will be deported.


There doesn't seem to be much of an acknowledgement of the effect of other countries reciprocating. I can image Boeing losing a multi-billion dollar order to Airbus over some stupid dispute over trade. These things make bike parts look pretty trivial. The funny thing is that US agriculture probably stands to lose the most and they overwhelmingly voted for the Donald. The Pacific rim is a huge potential export market for beef and pork, but you don't think they will feel like buying from the US if they are getting screwed.
Last edited by: windschatten: Jan 23, 17 22:59
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Re: Trump and the bike industry ? [nickwhite] [ In reply to ]
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nickwhite wrote:
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.

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Even if bike prices do come up a bit, will that be worth it if lots more Americans get good jobs?

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.

The Cannondale Bedford (Pennsylvania) factory produced and produces bicycles. Lost the carbon fiber production to overseas production due to cost savings.
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Re: Trump and the bike industry ? [Billyk24] [ In reply to ]
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Just a question for the group.... How does ENVE, which is made in the US, compete against the foreign wheels? Trek made their Bontrager wheels here for a long time, and supposedly make their 9 series bikes here. Other then infrastructure needs, once that is established it will allow products to come to market considerably faster as well.
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Re: Trump and the bike industry ? [DarkSpeedWorks] [ In reply to ]
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i am just returning from the TBI conference and this has already begun to change the behavior of bike makers. trumps election is bringing production back to the U.S. because of the fear and uncertainty of his policies and temperament. but this is limited to bikes at $3000 and up.

the last i heard, the carbon fiber manufacturing (the fiber, the pre-preg) was dominated by china. i may be way off on this, but i think one consideration, if we got ourselves into a trade war, is whether we have enough carbon fiber manufacturing in the U.S. to keep up with a surge in U.S. manufacturing. even if bike frames could instantly cheaply be made in the U.S., tarifs on carbon fiber and on all the parts would push prices way up. yes, we could move to U.S.-based SRAM parts but many of those parts are, as far as i know, also made in asia.

beyond this, i don't know if i'm going to be traveling to cuba next month to watch the triathlon in havana because i don't know how our relations with cuba may change between now and then.

so, yes, the election is affecting our sport.

Dan Empfield
aka Slowman
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Re: Trump and the bike industry ? [Slowman] [ In reply to ]
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Slowman wrote:
tarifs on carbon fiber and on all the parts would push prices way up.
That assumes tariffs would apply equally to parts AND finished goods.
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Re: Trump and the bike industry ? [rijndael] [ In reply to ]
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That's the thing about trade wars. They're like kinetic wars. Or lawsuits. Or affairs. Or drug habits. Once you start they on take lives of their own. Once you set them in motion you're quickly disabused of the fiction you can control what you began.

Dan Empfield
aka Slowman
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Re: Trump and the bike industry ? [DarkSpeedWorks] [ In reply to ]
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Here's the thing that NO ONE talks about in these discussions about trade and manufacturing.

Let's look at one small category - wetsuits. ALL the wetsuits in the world are now made in about 4 - 5 factories in China (tri wetsuits included). This is a business and a market that the Chinese manufacturers - there is a bit of a range in quality, but the quality from the best manufacturers over in China is outstanding! I'm told the factories are all good and clean. The Managers over in China good and easy to deal with (I've had to deal with some of them). They have the wetsuit business all figured out over there.

In the triathlon business the last company in the wetsuit business to have wetsuits made in "North America" (Mexico) had almost an entire year run of wetsuits fall apart!

Bottom line - you can now buy a great, well fitted and well made triathlon wetsuit for $500 or less.

Just looking at THIS business, what is the solution then to Trump's idea to, "Buy American and hire American"?


Steve Fleck @stevefleck | Blog
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Re: Trump and the bike industry ? [DarkSpeedWorks] [ In reply to ]
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Trump and cycling?

Give the guy credit - he may have been ahead of his time - https://cyclingtips.com/...to-american-cycling/

This is a great read!

However true to current form, Trump bragged and boasted, saying that the Tour de Trump would, "Rival the Tour de France" one day! Also true to current form, he had a short attention span and was in and out of the bike racing business rather quickly! :)


Steve Fleck @stevefleck | Blog
Last edited by: Fleck: Jan 24, 17 8:56
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Re: Trump and the bike industry ? [jimmytheeagle] [ In reply to ]
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jimmytheeagle wrote:
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.

That was my first thought

How much more can a Walmart bike cost with a "Made in USA" sticker on it vs. the ones they sell now? 10%?

But what would be the point, if there's no safe place for people to ride them, anyway?

"What's your claim?" - Ben Gravy
"Your best work is the work you're excited about" - Rick Rubin
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Re: Trump and the bike industry ? [Bob Loblaw] [ In reply to ]
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Bob Loblaw wrote:
......we'll all have carbon fiber American-made bikes ......

I already have one.

Pink? Maybe. Maybe not. You decide.
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Re: Trump and the bike industry ? [RandMart] [ In reply to ]
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RandMart wrote:
How much more can a Walmart bike cost with a "Made in USA" sticker on it vs. the ones they sell now? 10%?

Significantly more than that.....as someone who has direct experience in this area, the labor costs on a mass merchant bike are a pretty significant percentage of total product costs.

Which bring sup another relevant point - there is no infrastructure in thsi country to support mass production of bicycles. You need a wide array of component suppliers and the taiwanese (who own most of the component and bike factories in China) are not gonna be very interested in opening up US facilities. Again, having direct experience here, no component suppliers or factory ahd any interest in setting up shop in Mexico back around 99 / 00 because they viewed it as a step towards their own eventual demise.

So even if you set up a bike facotry here in the US, you will still need to import nearly ALL of the components needed to build the bike......assuming those massive tariffs go through, all those components would be subject to them.

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
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Re: Trump and the bike industry ? [Slowman] [ In reply to ]
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Slowman wrote:

the last i heard, the carbon fiber manufacturing (the fiber, the pre-preg) was dominated by china. i may be way off on this, but i think one consideration, if we got ourselves into a trade war, is whether we have enough carbon fiber manufacturing in the U.S. to keep up with a surge in U.S. manufacturing. even if bike frames could instantly cheaply be made in the U.S., tarifs on carbon fiber and on all the parts would push prices way up. yes, we could move to U.S.-based SRAM parts but many of those parts are, as far as i know, also made in asia.

There is quite a bit of carbon fiber production in the US (incl Hexcel, Toray, Cytec-Solvay, MItsubishi), as well as prepreg. None of the companies are 'American' though - they just manufacture carbon fiber and prepreg here. However, as far as I know almost everything goes into aerospace or military applications. I think the bike manufacturers will have a tough time getting more prepreg from the US suppliers because their volumes are tiny compared to aerospace.
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Re: Trump and the bike industry ? [Power13] [ In reply to ]
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Power13 wrote:
So even if you set up a bike factory here in the US, you will still need to import nearly ALL of the components needed to build the bike......assuming those massive tariffs go through, all those components would be subject to them.

Good point ... it's not there's a full-production-line Schwinn factory just sitting around vacant, waiting for someone to push the green button and turn it back on

Thanks

"What's your claim?" - Ben Gravy
"Your best work is the work you're excited about" - Rick Rubin
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Re: Trump and the bike industry ? [Power13] [ In reply to ]
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So even if you set up a bike facotry here in the US, you will still need to import nearly ALL of the components needed to build the bike......assuming those massive tariffs go through, all those components would be subject to them.


What's happened over the course of the last 20+ years is that industries like the bike business have become rather complicated and highly evolved in terms of their supply chains. Consumers have become WAY more demanding and discriminating with their wants/needs. Manufacturers have delivered ever greater technology and improvements - and this has gone on and trickled down through model lines in the bike business. That $3,500 Ultegra Bike of today, was very similar in quality and performance, if not the same, to the bikes that were winning the Tour de France and IRONMAN races just a few short years ago! It's a great time to be a bike consumer!

It's NOT easy to un-do all that, but that is the simplistic language that Trump wants to use. It's WAY over simplified. It appeals to Trump supporters, but with all due respect, they don't seem to understand what's happened in the last 20+ years! You can't just wave a magic wand and change it all!

BTW Trump's "Make America Great Again" hats, I heard were made in China! Could have been #FakeNews - lot's of that going around! :)


Steve Fleck @stevefleck | Blog
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Re: Trump and the bike industry ? [DarkSpeedWorks] [ In reply to ]
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Could also apply to much more of our goods. An area I have some experience is clothing, but as stated, wetsuits, helmets, etc. At a time when triathlon is struggling for more participants, this may be pretty impactful.
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Re: Trump and the bike industry ? [M----n] [ In reply to ]
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M----n wrote:
"or they continue making it, and just make less profit."

This is the funniest thing I've read all day.
The way you quoted that made it look like I said that. I would not say something so naĂ¯ve. If anything, any change in manufacturing or supply business forced upon a manufacturer by regulations will be an excuse to raise prices even if manufacturer's costs have gone up only nominally.
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Re: Trump and the bike industry ? [chrisgrigsby] [ In reply to ]
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chrisgrigsby wrote:
Human behavior is incredibly rational and predictable given a basic understanding of the 'rules of the game'.

Not exactly.
Human behavior, even economic human behavior, is not by any stretch rational. It's been shown and been proven to be highly irrational.

However, irrational human economic behavior is, oddly, still predictable. Well, statistically predictable at least on the micro level.

Check out, "Predictably Irrational," by researcher and behavior economist Dan Ariely. It is a truly outstanding book on this very topic.

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Re: Trump and the bike industry ? [Fleck] [ In reply to ]
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Fleck wrote:
In the triathlon business the last company in the wetsuit business to have wetsuits made in "North America" (Mexico) had almost an entire year run of wetsuits fall apart!

Not sure when that was. Are you talking about QR suits? What time period are you talking about?

I had a fully US made wetsuit in the early 1990s (made by ProMotion in OR, but they have since outsourced to Asia). It was an outstanding wetsuit, it lasted a long long long time, and it was far better than what ProMotion sells today ...

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Re: Trump and the bike industry ? [DarkSpeedWorks] [ In reply to ]
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DarkSpeedWorks wrote:
Fleck wrote:
In the triathlon business the last company in the wetsuit business to have wetsuits made in "North America" (Mexico) had almost an entire year run of wetsuits fall apart!


Not sure when that was. Are you talking about QR suits? What time period are you talking about?

I had a fully US made wetsuit in the early 1990s (made by ProMotion in OR, but they have since outsourced to Asia). It was an outstanding wetsuit, it lasted a long long long time, and it was far better than what ProMotion sells today ...

fleck is talking about a good few years later when rules were introduced that you could not use certain glues anymore in the Usa
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Re: Trump and the bike industry ? [pk] [ In reply to ]
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What glues were restricted?

Federal regs or state regs?

What year or time period?

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Re: Trump and the bike industry ? [Bob Loblaw] [ In reply to ]
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politics in everything these days
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Re: Trump and the bike industry ? [DarkSpeedWorks] [ In reply to ]
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DarkSpeedWorks wrote:
What glues were restricted?

Federal regs or state regs?

What year or time period?

My guess is anyone that contained Trichloroethane. Its use was restricted in the mid 1990s.
Last edited by: rijndael: Jan 24, 17 15:36
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