Logo of Phnom Penh Post newspaper Phnom Penh Post - US seeks to produce bicycles in Kingdom, move away from China

US seeks to produce bicycles in Kingdom, move away from China

Content image - Phnom Penh Post
The Kingdom’s exports of bicycles to the US are expected to grow due to US-imposed tariffs on China. Post staff

US seeks to produce bicycles in Kingdom, move away from China

Cambodian exports of bicycles to the US are expected to gain from recent tariffs imposed by the US on China, thanks to several bicycle producers who have unveiled plans to move to the Kingdom, a report from a leading industry portal said.

Bicycle Retailer, the website of Kent International Inc – an American importer and distributor of bicycles and bicycle accessories – plans to move a large share of its production from China to Cambodia in the next few months.

As evidence of this, one of Kent’s major Chinese suppliers is building a new 500,000sq ft (46,452sqm) factory in Cambodia.

Kent CEO Arnold Kamler said the factory will begin shipping bicycles in September next year.

“Assuming the 25 per cent tariff takes effect, the idea is to move essentially all of our production from China to Cambodia,” he said.

After imposing a 10 per cent tariff on Chinese bicycles in September, the tariff is set to increase to 25 per cent in January.

To comply with US Customs’ rules of origin, Kamler said Cambodian parts and labour would make up at least 35 per cent of the value of Kent’s Cambodian bicycles, which will have Cambodia-made frames and forks.

The report said the factory that Kent is working with is in the south, near Phnom Penh.

Besides Kent International, Trek Bicycle Corporation – another US-based bicycle and cycling product manufacturer and distributor – is also reported to have plans to move production of at least 200,000 bicycles from China to Cambodia next year.

Cambodia Chamber of Commerce (CCC) vice-president Lim Heng said on Monday that the US’ decision to increase the tariff on Chinese products could lead some types of production in China slow down.
This, he said, will eventually negatively affect the export of some raw materials from Cambodia to China.

However, he said Cambodia should gain more than it loses as many factories in China, including those that produce bicycles, plan to relocate their production to the Kingdom where the cost of doing business is cheaper, and from where products can be exported duty-free to many major markets.

“We [CCC] have received more contact from investors abroad to know about Cambodia’s investment potential as they want to open their factories here. When they seek to expand their production, they should find Cambodia more interesting,” he said.

US trade data show that Cambodian bicycle exports accounted for $24 million last year. This placed the Kingdom third behind China and Taiwan which exported $874 million and $390 million worth respectively.

Besides the US market, Cambodia became the largest bicycle supplier to the EU last year when it exported more than 1.42 million bicycles – an increase of nine per cent from 1.29 million bicycles in 2016.
Cambodian made bicycles can be exported duty-free into the EU under the blocs Everything But Arms (EBA) programme.

Despite the tariff advantage and lower labour costs, there are challenges for manufacturing in Cambodia as the Kingdom lacks an industry cluster, which means many components must be imported, making it time-consuming and affecting costs.

MOST VIEWED

  • Wing Bank opens new branch in front of Orkide The Royal along Street 2004

    Wing Bank celebrates first anniversary as commercial bank with launch of brand-new branch. One year since officially launching with a commercial banking licence, Wing Bank on March 14 launched a new branch in front of Orkide The Royal along Street 2004. The launch was presided over by

  • Girl from Stung Meanchey dump now college grad living in Australia

    After finishing her foundational studies at Trinity College and earning a Bachelor’s degree from the University of Melbourne in 2022, Ron Sophy, a girl who once lived at the Stung Meanchey garbage dump and scavenged for things to sell, is now working at a private

  • Ministry using ChatGPT AI to ‘ease workload’; Khmer version planned

    The Digital Government Committee is planning to make a Khmer language version of popular artificial intelligence (AI) technology ChatGPT available to the public in the near future, following extensive testing. On March 9, the Ministry of Post and Telecommunications revealed that it has been using the

  • Rare plant fetches high prices from Thai, Chinese

    Many types of plants found in Cambodia are used as traditional herbs to treat various diseases, such as giloy or guduchi (Tinospora cordifolia) or aromatic/sand ginger (Kaempferia galangal) or rough cocklebur (Xanthium Strumartium). There is also a plant called coral, which is rarely grown

  • Wat Phnom hornbills attract tourists, locals

    Thanks to the arrival of a friendly flock of great hornbills, Hour Rithy, a former aviculturist – or raiser of birds – in Kratie province turned Phnom Penh tuk tuk driver, has seen a partial return to his former profession. He has become something of a guide

  • PM urges end to ‘baseless’ international Ream base accusations

    Prime Minister Hun Sen urges an end to “baseless” foreign accusations surrounding the development of the Kingdom’s Ream Naval Base, as the US has consistently suggested that the base is being expanded to accommodate a Chinese military presence. Hun Sen renewed his calls while