Where Was Your Bike Made?

When I first became a dedicated bicyclist, the European countries most associated with bike-making were England, France and Italy. 

(OK, some will argue that England isn't a European country.  But even post-Brexit, the links between the island and continent are unmistakable.)

That was in the 1970s.  In the US, a few custom builders constructed nice frames and Japan was challenging European hegemony (Does that sound like a phrase out of my Western Civ class?) in the lightweight bike arena.  But if you bought a European derailleur-equipped machine in a bike shop, it most likely came from one of the three countries I mentioned at the beginning of this post.

Like so many other kinds of other manufacturing, bike (and component) production has moved away from those high-wage countries.  While some shifted to Asia, still other fabrication has moved to other European countries.

As a result, the European country that manufactures the most bikes (2.7 million) is now...Portugal.  To be fair, it was not without a bike industry or culture before trade barriers between it and other European Union countries were lifted. But its considerably lower wages attracted manufacturing from "legacy" bike companies and caused new bike companies to set up shop in the westernmost nation of the continent.

Interestingly, Italy, at 2.1 million, is the second-largest bike producer in the EU.  Germany, Poland and the Netherlands, at 1.5, 0.9 and 0.7 million, respectively, round out the top five bicycle-manufacturing countries in the EU. Together, they accounted for about seven out of every ten bicycles made in the EU.

France?  It's number 6, at half a million bikes.  And England, which is no longer part of the Union, produces about half as many.

Here is something inquiring minds want to know:  How is a bike defined as made in one country or another?  Traditionally, the "Made In" label meant that the bike's frame was brazed or welded*, finished and outfitted with components --which may have come from another country in that country. (As an example, from the late 1970s onward, many European and American bikes sported Japanese derailleurs, freewheels and cranksets.)  However, I've heard that some bikes have only had finishing work done in the country of origin its manufacturer claims.    

*--Frames were often made from imported materials, e.g., French Peugeots made from English Reynolds tubing.

What Gears Are Turning In His Mind?

Some time in your childhood, you probably had, at least once, the sort of teacher who punished everyone in your class for something one kid did.  

That, I believe, is the sort of teacher Donald Trump would have been had he pursued the life of an educator.

At least, that is what I believe after seeing one of his latest threats. If he acts on it, some $11.5 billion in goods from the EU could be subject to retaliatory tariffs.  Among those items are hubs and sprockets.

So why does El Cheeto Grande want to slap punitive taxes on wheel goods and gears?  Well, he rationalizes this threat with a World Trade Organization ruling from last May, which found that Airbus had received illegal subsidies from European countries and gave the US the right to impose retaliatory tariffs.

What he didn't mention, however, is a more recent WTO ruling, specifically from last month:  Boeing, which just happens to be Airbus's main rival, received similarly illegal tax breaks in the US.  Thus, said the WTO, the EU can impose sanctions on imports from the US.

Now, I thought really hard about why freewheels, cassettes and hubs for bicycles--or motorcycle hubs or sprockets--are targeted for tariffs that are supposed to punish Europeans for supporting their aerospace industry.  All I could come up was this:  Aircraft have wheels, which use hubs.  And their engines use gears, i.e., sprockets.  So, perhaps, anything that could potentially help an A-380 take off, fly or land is fair game for new taxes.

Hmm...I'm not sure that works.  I must say I tried, really tried, to understand the logic of the threat. But then I remembered:  This is Donald Trump we're talking about.  

Lower Bicycle Taxes--In Belgium?

I've bashed the US President more than a few times on this blog.  But, to be fair to El Cheeto Grande, I must point out that he isn't the only one who's come up with a completely pointless tax on bicycles.  Oregon imposed their own state tax a little less than two years ago; other jurisdictions either have done, or are considering, something similar.

Of course, in the US, about three generations of adults didn't cycle. So, we are just starting to understand that the bicycle is a viable means of transportation as well as enjoyable means of recreation and exercise rather than just a kid's toy.

On the other hand, Europeans still see the bicycle as I've described it.  In some countries, masses of people never traded two wheels for four; in others (or in parts of some countries), the auto-centric culture hasn't persisted as long as it's had its grip on America.  Thus, to people to ride again, and safely, Europeans can tap into memory, if you will, that hasn't gone dormant or extinct.

Such is the case in Belgium.  That country has more bicycle-related events, from races to randonees to rallies, and more talented cyclists, per capita than just about any other nation.  I haven't spent a lot of time there, but it's easy to see that bicycles and velocipedic culture are never very far from Belgians' consciousness.

That might be the reason why some law makers over there understand that the way to build useful and sensible infrastructure, preserve a country's bicycle industries and, well, encourage people to ride, is not to impose more taxes on bikes, whether at the retail level or when they enter the country from someplace else.  

Bicycles parked by medieval houses in Ghent, Belgium

At least, that's the impression I have after the Belgian parliament voted through a bill to impose a lower sales tax for bicycles and e-bikes than the current Value Added Tax levied there and in other European Union nations.  If approved by the European Commission, the surcharge for bicycles and e-bikes would be lowered from the standard VAT of 21 percent to 6 percent.

Belgian politician Laurent Devin has been championing such a measure for some time.  Other political leaders agree, including Ahmed Laaouej, agree.  He  leads the Belgian Socialist Party, which happens to be the second-largest party in Belgium's parliament.

While some EU member states have been able to reduce the VAT on bicycle repairs, no other country has attempted such a widespread reduction on the taxes levied on two-wheelers.  In 2017, 445,000 bicycles were sold in the country, of which 218,000 were e-bikes--in a country of 11.35 million people.  On a per capita basis, that is roughly the same number of bikes sold in the US, but Belgians, like other Europeans, tend to keep and ride their bikes longer than Americans, so fewer are first-time bike buyers than in the US.