Tariff on Chinese bikes could inflate prices

Wed, August 31, 2005

Tariff on Chinese bikes could inflate prices

By BILL RODGERS, Parliamentary Bureau

A proposed 48% tariff on bicycles imported from China and other Asian countries will hit Canadian cyclists hard in the pocketbook and could devastate hundreds of small retailers across the country, bike shop owners warn.

The issue has pitted an estimated 1,200 small retailers against Canadian bicycle manufacturers who say the penalty is needed to protect their industry from a harmful surge of Asian bikes being dumped on the Canadian market.

"The Canadian industry is being so swamped by imports from China and from a bunch of other countries -- mostly Asian economies -- that they can't keep up with all the competition, so they're asking for a temporary protection of up to three years, with duties of up to 48%," said Geoffrey Kubrick, the lawyer representing the Canadian Bicycle Manufacturers Association.

Kubrick, who took the case to the Canadian International Trade Tribunal and expects a decision this week, said a global safeguard is needed for Canadian manufacturers -- mostly Quebec-based -- arguing imports from China and elsewhere went from a level of about 600,000 bicycles in 2000 to over a million last year.

'BUNCH OF BALONEY'

"That's a bunch of baloney," scoffed Ottawa retailer Kevin Pidgeon of Tommy and Lefebvre, who suggests the case is about Quebec-based Raleigh Canada and Groupe Procycle trying to monopolize the Canadian market.

"This has nothing to do with importation of bicycles because I'm going to tell you that bicycles coming from outside the country for the most part are more expensive than bicycles produced in Canada, so that (argument) is a bunch of garbage," Pidgeon said.

Unlike mass merchants Canadian Tire and Wal-Mart, Tommy and Lefebvre and other small retailers across Canada sell mid to high-end bikes and Pidgeon predicts consumers of those models would see a bike priced at $500 today increase to about $750 if the federal government okayed the tariff.

Local bike shop owners say it would be devastating to business.

"It'll be a setback on everything that the bike comes with that's from China," said Eric Cousineau, manager of Pecco's bike shop on Murray St.

Chris Bloch-Hansen, manager at the Fresh Air Experience bike store on Wellington St., also expects that prices will rise if there is a tariff, but he's not worried yet.

"Right now, it's only talk and speculation," he said.

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