Some common refrains in discussions about American manufacturing are “we don’t make that here,” or “we can’t compete on price.” Take the bicycle for example, a product likely found in nearly every American household. The conventional narrative today suggests that almost all bicycles-–particularly frames and intricate components—are produced overseas because American consumers primarily shop based on price. But lately you may find everyone talking about how that narrative is changing—because American manufacturing is making a comeback.
Guardian Bikes, an American company out of Seymour, Indiana that sells direct-to-consumer, wants to ensure that it keeps manufacturing 100% of its bicycles right here in the U.S., and to do so, has received a $19 million loan from J.P. Morgan to help them. This loan will go towards building America’s first large-scale bicycle frame manufacturing operation within our own shores in at least thirty years. Guardian Bikes serves as a testament that changes in Washington trade policies over the years do have an impact on a company’s decision to invest in manufacturing—even in sectors long dominated by Asian imports. Moving forward, protective tariffs from Washington levied against China might help them, and additionally Taiwan has also recently seen its tariffs rise, presently at 10%.
“We are proud to play a small part in Guardian’s journey to disrupt the bicycle industry,” said Zoë Dobbs, a commercial banker at JPMorgan Chase Middle Market Banking in Austin, TX. “We look forward to the continued transformation of a core childhood pastime.”
How Bike Loving America Lost Its Way
The reality of today is that most bicycles sold in the U.S. are made overseas. Most brands with an American presence now do assembly only, or are confined to making only a handful of parts. If they are involved in making more of a custom, expensive bike for niche riders rather than for mass-market, you might search out a brand like Seven Cycles in Watertown, Massachusetts, for example.
From 1947 to 1949, imported bicycles accounted for less than one percent of total U.S. bicycle consumption. Most bikes purchased were for children, and the number of children ages 8 to 14 was also naturally climbing during the post-war baby boom. At that time, bicycles also faced a 30% tariff globally, which eventually dropped down to 11%.
Once the tariffs declined, big retailers—such as American department stores—began importing more bikes for consumers here at home. Eventually, imports made up about 10% of the market by 1952, and then 40% by 1955. After a few decades of fluctuating tariffs, by 1999, the last three major U.S. bike manufacturers (Huffy, Murray, and Roadmaster) had shut down domestic operations, laying off thousands. Smaller firms folded, as well. Steel companies inevitably lost steady customers.
Even still, higher tariffs have helped—along with Guardian’s decision to sell directly to consumers. Today, a whopping 85% of all bicycles sold in the United States are imported from China—an eye-opening number that remained steady even under the 25% Section 301 tariffs, and China’s pricing power has remained formidable. Iconic brands like Huffy and Schwinn are no longer American-made. Schwinn is now owned by Pon Holdings, a Dutch conglomerate, and manufactured in China. Huffy is now owned by United Wheels, also based in China.
We’re not just building bikes—we’re rebuilding an industry. We’re doing it with cutting-edge automation and creating good-paying local jobs.
No one knows whether a company will be able to ultimately survive, due to tariffs put in place or left to free trade alone. In this post-pandemic era of surplus inventory, many bike makers are now also lowering prices, and any number of market factors can help to make or break a business. Trade and tariffs only ever prove a minor influence on prices and inflation, as evidenced by the drop in bike prices, but other economic factors in the market remain much more powerful.
Still, protective tariffs or quotas, combined with a fair and transparent regulatory environment and low taxes, are among the best tools small- to mid-sized American companies can have in place to help them survive. Without such friendly policies, imports will continue to eat away at market share. Larger companies—those with more access to capital and the ability to absorb short-term costs—will continue to offshore, even if productivity is lower abroad than at home, and even if shipping to the customer adds to their overall costs. Lastly, a scaled domestic supply chain for bicycles could increase demand for American-made steel and aluminum, while reviving the metal fabrication, welding, and tool-and-die skills needed to reindustrialize the country.
All manufacturing industries supply crucial demand and infrastructure support for sustaining the defense industrial base, which of course is integral to the nation’s economic and national security. We cannot have an industrial base that is increasingly reliant on government contracts to manufacture goods. These companies need private industry, other manufacturers, to also solicit their work to make the things they need to flourish, but also just to survive. This is what it means to have a resilient domestic supply chain. A deep manufacturing bench works to support deep supply chains, enhanced workforce readiness, and advances in innovation.
The history of the bicycle industry—particularly America’s story in leading and then losing that popular industry—illustrates the failures of past, country-specific trade remedies, where the whack-a-mole dynamic is so prevalent. Especially when studying that the only trade policy that meaningfully curbed mass imports was the global tariff system of the 1950s and early 1960s.
“Bike manufacturing once provided solid middle-class jobs for thousands of Americans,” said CPA chief economist emeritus Jeff Ferry. “Guardian’s plan to make frames and components and assemble bikes at multiple U.S. locations is good for U.S. workers and our industrial base.”
MADE IN AMERICA.
CPA is the leading national, bipartisan organization exclusively representing domestic producers and workers across many industries and sectors of the U.S. economy.
J.P. Morgan Backs American Bike Manufacturer with $19 Million Amid Asian Imports
Some common refrains in discussions about American manufacturing are “we don’t make that here,” or “we can’t compete on price.” Take the bicycle for example, a product likely found in nearly every American household. The conventional narrative today suggests that almost all bicycles-–particularly frames and intricate components—are produced overseas because American consumers primarily shop based on price. But lately you may find everyone talking about how that narrative is changing—because American manufacturing is making a comeback.
Guardian Bikes, an American company out of Seymour, Indiana that sells direct-to-consumer, wants to ensure that it keeps manufacturing 100% of its bicycles right here in the U.S., and to do so, has received a $19 million loan from J.P. Morgan to help them. This loan will go towards building America’s first large-scale bicycle frame manufacturing operation within our own shores in at least thirty years. Guardian Bikes serves as a testament that changes in Washington trade policies over the years do have an impact on a company’s decision to invest in manufacturing—even in sectors long dominated by Asian imports. Moving forward, protective tariffs from Washington levied against China might help them, and additionally Taiwan has also recently seen its tariffs rise, presently at 10%.
“We are proud to play a small part in Guardian’s journey to disrupt the bicycle industry,”
said Zoë Dobbs, a commercial banker at JPMorgan Chase Middle Market Banking in Austin, TX. “We look forward to the continued transformation of a core childhood pastime.”
How Bike Loving America Lost Its Way
The reality of today is that most bicycles sold in the U.S. are made overseas. Most brands with an American presence now do assembly only, or are confined to making only a handful of parts. If they are involved in making more of a custom, expensive bike for niche riders rather than for mass-market, you might search out a brand like Seven Cycles in Watertown, Massachusetts, for example.
From 1947 to 1949, imported bicycles accounted for less than one percent of total U.S. bicycle consumption. Most bikes purchased were for children, and the number of children ages 8 to 14 was also naturally climbing during the post-war baby boom. At that time, bicycles also faced a 30% tariff globally, which eventually dropped down to 11%.
Once the tariffs declined, big retailers—such as American department stores—began importing more bikes for consumers here at home. Eventually, imports made up about 10% of the market by 1952, and then 40% by 1955. After a few decades of fluctuating tariffs, by 1999, the last three major U.S. bike manufacturers (Huffy, Murray, and Roadmaster) had shut down domestic operations, laying off thousands. Smaller firms folded, as well. Steel companies inevitably lost steady customers.
Even still, higher tariffs have helped—along with Guardian’s decision to sell directly to consumers. Today, a whopping 85% of all bicycles sold in the United States are imported from China—an eye-opening number that remained steady even under the 25% Section 301 tariffs, and China’s pricing power has remained formidable. Iconic brands like Huffy and Schwinn are no longer American-made. Schwinn is now owned by Pon Holdings, a Dutch conglomerate, and manufactured in China. Huffy is now owned by United Wheels, also based in China.
No one knows whether a company will be able to ultimately survive, due to tariffs put in place or left to free trade alone. In this post-pandemic era of surplus inventory, many bike makers are now also lowering prices, and any number of market factors can help to make or break a business. Trade and tariffs only ever prove a minor influence on prices and inflation, as evidenced by the drop in bike prices, but other economic factors in the market remain much more powerful.
Still, protective tariffs or quotas, combined with a fair and transparent regulatory environment and low taxes, are among the best tools small- to mid-sized American companies can have in place to help them survive. Without such friendly policies, imports will continue to eat away at market share. Larger companies—those with more access to capital and the ability to absorb short-term costs—will continue to offshore, even if productivity is lower abroad than at home, and even if shipping to the customer adds to their overall costs. Lastly, a scaled domestic supply chain for bicycles could increase demand for American-made steel and aluminum, while reviving the metal fabrication, welding, and tool-and-die skills needed to reindustrialize the country.
All manufacturing industries supply crucial demand and infrastructure support for sustaining the defense industrial base, which of course is integral to the nation’s economic and national security. We cannot have an industrial base that is increasingly reliant on government contracts to manufacture goods. These companies need private industry, other manufacturers, to also solicit their work to make the things they need to flourish, but also just to survive. This is what it means to have a resilient domestic supply chain. A deep manufacturing bench works to support deep supply chains, enhanced workforce readiness, and advances in innovation.
The history of the bicycle industry—particularly America’s story in leading and then losing that popular industry—illustrates the failures of past, country-specific trade remedies, where the whack-a-mole dynamic is so prevalent. Especially when studying that the only trade policy that meaningfully curbed mass imports was the global tariff system of the 1950s and early 1960s.
“Bike manufacturing once provided solid middle-class jobs for thousands of Americans,” said CPA chief economist emeritus Jeff Ferry. “Guardian’s plan to make frames and components and assemble bikes at multiple U.S. locations is good for U.S. workers and our industrial base.”
MADE IN AMERICA.
CPA is the leading national, bipartisan organization exclusively representing domestic producers and workers across many industries and sectors of the U.S. economy.
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