European Commission Commencing Investigation on Chinese E-Bike Dumping
The European Commission recently published a notice that they would be commencing an anti-dumping investigation into imported e-bikes originating in China.
According to the October 20 Notice, the European Commission received a complaint from the European Bicycle Manufacturers Association (EBMA) about China’s alleged dumping of ebikes.
The term dumping is used to describe a process where imported items are sold below the cost of production or home market prices. This process damages domestic e-bike makers and potentially threatens jobs.
The complaint was lodged on September 8 by e-bike producers who represent more than 25% of the European Union’s total production of e-bikes.
The Notice further stated that the Commission had received information that included a comparison of the normal value of the product under investigation with its export price when sold for export to the European Union. Using these details as a basis, the calculated dumping margins are considerable.
In addition to the substantial dumping margins, the official European Union journal document also states that evidence has been received that Chinese e-bike imports into the EU has experienced an overall increase in absolute terms and market share. According to the report, this has had a negative impact on the quantities sold, the price levels charged and the market share retained by the EU industry, resulting in significant negative effects on the overall performance and the financial status of the EU industry.
The European Commission’s investigation is oriented around both 25km/h – 250W e-bikes and speed pedelecs that were imported from China between October 1st of last year and September 30th 2017. In addition, the Notice says that the examination of trends applicable to the injury assessment process will cover the time from January 1, 2014 to the end of the investigation period.
The statutory time schedule for European Commission dumping investigations stipulates that all proceedings must be concluded within 15 months of their publication date in the Official Journal of the European Union, which means the investigation must be completed by January 20, 2019.
However, long before that deadline e-bike imports from China could be hit with a provisional anti-dumping duty. Depending on the findings of the investigators, such a duty could be imposed as early as July 2018.
Bafang Electric Drive Systems
Further more Chinese electric bike motor manufacturer Bafang has been named as a company receiving subsidies from the Chinese government.
What Will This Mean For UK Electric Bike Consumers?
If a levy is imposed then all electric bikes imported from China will increase in cost and therefore price. Approximately 44% of all electric bikes imported to the UK come from China so any increase in cost will have a big impact on the market and certainly hand more control to EU companies such as Bosch and Accell.
There is an irony or two here as many electric bikes from big European manufacturers are made in China or have components made in China. Because of this we are unlikely to see levies on ebike components just complete ebikes.
I have personally been to factories in China manufacturing electric bikes for premium brands that consumers would otherwise consider to be made in Holland, Germany, Switzerland or Spain. It is possible that a levi will also hurt some of the smaller EU manufacturers that produce some of their models in China.
Being the longest established electric bike retailer in the UK we can attest that with very few exceptions products from Japan and China helped to create a market that is now so attractive to EU companies that they wish to control imports.
Bafang as an example have been enabling lower cost electric bikes for almost 20 years. The relatively low price of some Chinese electric bikes has certainly helped to establish the market by giving people a first taste and then inevitably....ebike addiction....which intern has helped the premium EU made bikes.
Is this protectionism? Is it a natural rebalancing of global trade affairs where Europe profits from an Asian industry?
An anti-dumping levy has been in place for non electric bikes from China for quite some time and the UK bike importers have responded by moving their manufacturing to Vietnam, Cambodia, Tunisia and India. Quality has been an even bigger issue but benefiting from even lower tariffs it has given the UK a lot of cheap bikes of sometimes dubious quality.
Whatever happens we will let you know what it means for you.