Tariffs cause chaos for bicycle industry, some makers pause shipments

A Tern GSD in its natural habitat: Hauling a child and their gear to hockey practice.

Tern, a Taiwan-based bike maker that specializes in e-bikes like the popular HSD and GSD cargo bikes, said they would pause shipments to the U.S. because the Trump administration's recently announced (and then abruptly rescinded) tariffs were beyond the point they can work around. Companies importing products from China are likely still in a holding pattern as the U.S. and China continue to escalate their tariff war, most recently set at an absurd 125% as of press time. Most other nations would see a 10% tariff as the additional tariffs announced last week have supposedly been paused for 90 days, though the Trump administration has been erratic and unpredictable. This information may be out of date within minutes of hitting publish.

A huge percentage of bicycles sold in the U.S. are made in China, though the number seems difficult to determine since many companies assemble their bikes in other countries and nearly always include parts from several different countries. Sometimes you see the figure cited around 40% of U.S. bike imports, and other times you see closer to 83%. Either way, it's a lot.

Even for companies that can avoid the escalating tariffs with China, a 10% increase in import costs will pose a big challenge to an already-troubled industry like bicycles that have already been paying various tariffs that were leftover from the first Trump administration. The notion that everyone in the supply chain will sharpen their pencils is not realistic," Tern General Manager for North America Steve Boyd told Bicycle Retailer and Industry News. If we had got just a 10% hit you'd go back and see what we could make work. But 46%, I just said, Don't ship us anything else until we figure it out.'"

Tern is based in Taiwan, but many of their bikes are made in Vietnam, which had been targeted with one of the highest tariffs before the 90-day pause. Like many companies across many industries, Tern rushed out a few final shipments before the tariffs took effect and planned to hold new imports in hopes that negotiations or political pressure will reduce them before too long. With Wednesday's announcement that Trump would suspend most the big tariff increases after being in effect for about 12 hours, we'll see if companies resume shipments. There are further complications for the industry to work out, such as how to deal with last month's 25% tariff on raw materials like steel and aluminum. Bike chains as well as some cables and accessories like some bike locks are subject to the metals tariff. So even the relatively few U.S. bike makers will see increases in the prices of materials and components.

For reasons that make as much sense as anything else in this story, tariffs on e-bikes are lower than non-electric bikes. So we are taxing the most humble mode of transportation the hardest. At least that's the case today. Who knows what this administration will decide to post on social media tomorrow?

It's not yet clear how all this will affect the market for used bikes, especially if low-end new bikes see significant price increases. The cost of parts to fix used bikes will go up, but I suspect the benefit of buying used will only get bigger. We'll see how things play out.

All of this is a crude a certainly incomplete summary of the chaos facing the larger bike industry right now. What it means for your local bike shop is that they will face higher wholesale prices (or higher tariffs if they import directly) for products and possibly increased difficulty keeping product in stock at all. This is a great time to give your local shop some extra business, and don't be shocked if prices have gone up.

It's also a great time for the Washington State House to say no to the WA Senate's e-bike tax. Our state's bike shops do not need any more unexpected cost increases right now.

Some good news is that WSDOT has launched their long-awaited e-bike rebate program. Washington State residents 16 or older can apply online now until noon April 23. Recipients of the $300 to $1,200 instant rebates will be selected at random after April 23.