The anti dumping of electric bicycles imported from China hearings was held at the Berlaymont Building on 18th April 2018.
The Chinese delegation consisted of: Mrs. Chen Huiqing of CCCME (China Chamber of Commerce for Import and Export of Machinery and Electronic Products), Mr. Song Bo of CBA (China Bicycle Association), Mr. Xiang Can of Jinhua Zuoyuan Co, Mr. Song Jie of Suzhou Benji and Mr. Jack Brandsen of Suzhou Bafang Europe.
The press conference was held in the conference room of Steptoe & Johnson LLP at 3 pm local time. In addition to the above-mentioned Chinese representatives, Annick Roetynck, the head of LEVA-EU, was also the representative of the European two-wheeler importer organization in this case. In addition to the representants of the major local media, Mr. Jack Oortwijn, editor-in-chief of the bicycle industry magazine Bike Europe was there as well the the consumer organization ExtraEnergy.org which is headquartered in Germany was represented by Mr. Jean Chen.
After the introduction into the topic was made by Mrs. Chen Huiqing Director of the Chinese Mechanical and Electrical Commercial Chamber, she began to answer questions from reporters. The first item discussed was on the subject of proven evidence of market data - how large are the exports of Chinese electric bicycles to Europe really?
Mrs. Chen Huiqing mentioned, that the source of data on the import quantity and import price proposed by EBMA was confidential and could not be verified in real time. The open question left in the room: Does China have valid data to prove the irrationality of EBMA's claim? However, the representative of China believes that since the case was filed by the EBMA, the EBMA should provide the evidence of the claims.
According to the Bike Europe magazine, the chief editor Jack mentioned, if there is no data available, if it is simple from an industry point of view, it is very similar to the manufacture of bicycles and electric bicycles. And Europe has had a 25-year anti-dumping policy on bicycles made in China and is still in progress. An important basis for the judgment is that bicycle manufacturing costs in countries such as Bangladesh in Asia is also 80-90 euros/vehicle, while bicycle manufacturing costs from China is 50 euros. Obviously, China's manufacturing costs should be higher than Bangladesh's, which in the bicycle case considers that China has dumping behavior.
Mrs. Annick Roetynck, head of the two-wheeler importer’s organization, suggested that manufacturers in Europe today should be called assemblers. Because most of the components in a electric bicycle are from Asia. Therefore, it is obviously unreasonable to use Switzerland as a reference country. The suggestion is Mexico or the United States.
Chinese delegate Jin Hua Zhuo Yuan Co. general manager Xiang Can replied that electric bicycles and bicycles are not exactly the same products. If there is the same BOM (bill of material), there is no essential difference between European and Chinese manufacturing. For example, the German brand Prophete is a brand that sells electric bicycles mainly through large chainstores chains. They are very price sensitive. But 2-3 years ago, production was moved from China directly to Romania with no obviouse price increase as a result.
The second focus point, Mrs. Annick Roetynk mentioned was that the EBMA has recently stated to the European Union that with the end of 2017 and the beginning of this year, imports of electric bicycles from China have shown a significant growth rate. The increase in this number is a preparation for the beginning of the April-October peak season for the European market. This includes the two-digit incremental demand for the electric bike market itself. The need for this move has been raised to the EU. A reporter believes that if the import data is not proven, perhaps collective registration could be a methode to solve the lack of reliable market data.
The third discussion item was the extent to which Chinese products have caused injury to the European market. The European electric bicycle market has grown from less than 10k to nearly 2 million units in the last few years. Since 2016, the Chinese domestic market is declining a bit, and as a Chinese manufacturer like Fujita has been still setting up new factories and shifted the focus on the export business. The unanswered Question is if these exports in a booming European market have caused harm to the European makers of electric bicycles which usually have just one issue - they can not make enough bikes to fulfill the customer demands.
In China, the boom of sharing bicycles which started in 2015 has made the entire bicycle industry experience an unprecedented OEM processing peak. During this period, European bike makers which ordered parts and frames from China have usually extreme delays caused by the sharing bike boom. With the emergence of the new national standard for electric bicycles in 2018, there will be a new round of product replacement in china which could cause again an extreme shortage of production capacities.
Due to time limitations it was not possible to discuss all items of interest. Here we do summarize some additional points which have been discussed by the experts:
Sometimes it is stated that Chinese products are usually just copies of European products - so called me to products just a bit less expensive but without own innovations. Probably there are many cases of counterfeit products to be found in China. In terms of electric bicycles the story is a bit funny since the modern electric bicycle the Pedelec was brought by Yamaha to Europe. And the European legislation recognizing the Pedelec for the first time was just established due to the strong efforts of Yamaha in this area. By 2003, there was no significant development of European electric bicycles and the market size was below 100.000 Units. At this time, the Chinese domestic market has already reached annual sales of one million units.
A large number of pioneers in Europe who are full of hope for the future environment protection went to China to learn about electric bicycles. Chinese companies are impressed by their enthusiasm and have developed products that meet European local markets requierements through joint development based on existing technologies from Chinese market. In 2008 the electric bicycle market in europe became finally visible and was growing fast.
Another question which was raised was if the China electric bicycle exports to Europe have caused loss of jobs in the European bicycle industry. In response to this question, the representative of China believes that helping China launch this market through manufacturing in China means that many people who were not originally in the industry are pushing the industry forward. If anti-dumping is successful, the chinese project that there will be a shortage of products and an increase in prices in the european market and that this would lead to job losses in the industry.. The Chinese delegates assume that the free market competition would create jobs as well in Europe since the market could grow faster. From the development experience of the Chinese industry, although electric bicycles belong to the bicycle industry, from the perspective of the participants, and most of them are today purely mechanical enterprises. China has grown jobs from thousands for electric bicycles market to about 300,000 employees today. The original bicycle industry only had some above 100,000 employees. This shows the growth potential due to the electrification and the higher value of electric bicycles.
The Chinese delegates envisioned a fair trade agreement like it was agreed upon the EU and Japanese car industry in the 1970s on limiting the total amount of Japanese cars to be exported form Japan to Europe. This has forced the Japanese car industry to try to get into higher priced car sectors to increase their profits and not go into quantities and on the other hand build local production bases in Europe and become localized with R&D, Production and Marketing in Europe. And today Japanese car brands are popular in Europe and good for a healthy competition between all players.
Text and picture: Jean Chen
Online Publication: Angela Budde
4th May 2018
Last update: 9th May 2018