Cycle makers see window of opportunity

Cycle makers see window of opportunity
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First Published: Tue, Aug 21 2007. 02 40 AM IST
Updated: Tue, Aug 21 2007. 02 40 AM IST
Indian cycle makers say they are ramping up their export plans to sell more to Europe, taking advantage of EU’s anti-dumping duties on import of cycles from China and Vietnam, the two major competitors of Indian companies.
“Imposition of anti-dumping duties against Chinese manufacturers offers a window of opportunity,” said G. Ramprasad, president of All India Cycle Manufacturers Association and president of Murugappa Group’s TI Cycles of India. “TI Cycles...has set up a cycle manufacturing line exclusively dedicated for export,’’ Ramprasad said, adding that exports to Europe would begin by the year end. He declined to elaborate on the export order.
The export market in the European region is approximately one-fourth of the domestic market, which is estimated at 10 million bicycles per annum. Manufacturers are also increasingly focusing on exports, as locally sales have been declining or have been at best stagnant in the last three years.
India is the second largest maker of cycles with an estimated annual industry size of Rs1,500 crore. Three major companies, Atlas Cycles Haryana Ltd, Hero Cycles Ltd and TI Cycles, together hold more than 85% of the market share.
Bicycles in Europe typically sell for between $100 (Rs4,160) and $1,500 though some speciality bikes sell for more. However, Indian manufacturers are likely to focus on cycles in the $250 range, which have steel and aluminium alloy, said Ramprasad. He said around three million cycles are sold annually in Europe at $250 per bike and the aim for Indian cycle makers was to capture 5-10% of this.
While Atlas Cycles did not respond to the queries sent to them, Hero Cycles, part of the Hero Group, couldn’t immediately be reached for comment.
The EU has imposed anti-dumping duties of 48.5% on bicycles imported from China. It also imposed anti-dumping duties of 34.5% on cycles imported from Vietnam.
As per the Eurostat data, exports from India in 2004 were 130,000 units, or 0.7% of total imports by the EU, while China and Vietnam during the same period exported close to 2.4 million cycles and had a market share of 12.77%. China and Vietnam in 2000 had less than 2.5% of this market but have ramped up in recent years.
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First Published: Tue, Aug 21 2007. 02 40 AM IST