Carbon Fiber Frames Manufacturing in China Part 2
We are seeing more and more carbon fiber manufacturers from China setting up new factories in Southeast Asia, in particular Vietnam and Myanmar . Will quality, lead time, and price improve? What are the implications regarding the political stability of these Southeast Asian nations? What will happen to carbon fiber manufacturers in China who have been dominating frame, components, and wheel production for the last decade?
Political implications for setting up factories in Southeast Asia in short is extremely high risk. Vietnam is still led by a Communist government, which as everybody knows, is prone to various scrutiny by Western governments. It could easily be riddled with tariffs from the United States (as President Trump threatened to do so back in September 2019). The Republic of the Union of Myanmar (formerly known as Burma) on the other hand is a newly formed democracy after decades on military rule. The issue here is not about its democratic reforms, but rather internal strife and conflicts with neighboring countries.
Despite the issues outlined, many factories are moving forward with their plans. Years of success by manufacturers that have established factories in Cambodia have shown that the risk is worth it. The trade war between China and USA, and also the decades long anti-dumping tariffs by the European Union against Chinese bicycle and e-bikes are main catalysts. There really is no choice for these Chinese manufacturers but to move to Southeast Asia.
Carbon bicycle frames produced in China are in a still in a grey area. Technically, frames and components can still be produced in China for export to the EU. Export to the USA is no longer feasible, however, due to the trade war tariffs. With complete bikes and electric bicycles also unable to be shipped directly from China to the EU or USA, the easiest way to legally circumvent this is to arrange painting and assembly in Taiwan or Southeast Asia. It can be expected that small to medium sized carbon fiber manufacturers will choose to stay in China for this reason. With recent reports from factories based in Southeast Asia regarding poor quality, labor issues, and major delays - having the option to maintain carbon fiber production in China is an advantage.
