Dumped On By An Anti-Dumping Investigation

We are being Dumped On by an ‘Anti-Dumping’ Investigation.

E-Bikes Direct and our fellow low cost electric bike sales companies are being dumped on from a great height. In 2017 a group of European electric bike manufacturers complained to the European Commission that Chinese companies are flooding the market with subsidised e-bikes and components and they say this is injuring their business.

What rubbish – as we will see in the next three blogs, everyone is doing well in the electric bike market as demand for them rockets. One of the complainants has had a 90% increase in business which is hardly being injured. The reason they are taking us on is to stop competition, but in actual fact this action could hurt e-bike sales as a whole and stop this fantastic technology from having the impact on transportation that it has the potential to do.  

Part 1 – Just What is Being Dumped?

The European Bicycle Manufacturers Association (EBMA) lodged a complaint that cheap Chinese e-bikes and components were being imported into the EU in excessive amounts and that this would damage their business.

In a statement, the EBMA Secretary General Moreno Fioravanti alleged, “Imports into the EU of e-bikes from China increased from virtually zero in 2010 to a level likely over 800,000 in 2017.”

E-Bikes Direct have joined a group of e-bike importers called the Collective of European Importers of Electric Bikes (CEIEB) – 21 companies from seven countries across the EU – who are contesting the EBMA allegations. Regarding this claim, we stated:

“Should the statistics however refer to the Chinese export code HS 8711901010, then it must be considered that this code covers “electric self-moving vehicles”, which is a far larger category than simply e-bikes. It also includes for example electric hoverboards, electric skateboards, electric scooters, electric monowheels, self-balancing vehicles, etc. This may well distort both export volumes and average price.”

In short, the 800,000 figure applies to all sorts of electric vehicles and toys – not just e-bikes. The data submitted by the EBMA is flawed.

What Is Dumping?

You may have run into things like steel being ‘dumped’ in the US and EU by China. This is where state supported industries are deliberately sending goods and materials to a target country or economic bloc such as the EU at costs well below that which can be made in the import country, and which could ultimately destroy the manufacturing industry in that target. China has been dumping steel in the EU and this has all but wrecked the British steel industry.

The EU has stringent anti-dumping laws and should a complaint be made and it investigates there could be severe consequences for the companies doing the dumping. According to the European Union website:

“These measures are usually in the form of an ‘ad valorem’ duty. Other measures that can be applied include a fixed or specific amount of duty or, in some cases, a minimum import price. 

Price undertakings may also be accepted instead of anti-dumping duties. This is where the exporter agrees not sell products in the EU at prices below a minimum amount.” 

At E-bikes Direct this could mean that it would be impossible to sell our cheapest models at a price you would want to pay for them. One of those models is the Byocycle City Folding Electric Bike for £679, and competes well with a nice little traditional bicycle that you might use for short runs into town and back – and is less than 10% of the cost of a car you might use to do the same runs.

Injury?

The EBMA made the allegations that the industry was being ‘injured’ by the large numbers of dumped electric bikes. We showed to the European Commission that:

“In the considered period, electric bike consumption in the EU increased by 55%. Growing demand resulted in sales for both the EU producers and importers to go up. Sales by EU producers supporting the complaint increased by 45% in the period considered. Furthermore, employment in EU industry also improved: with 9% in 2015 and with almost 12% in 2016”.

Among the winners in the EBMA was a European bike manufacturing giant which saw e-bike sales turnover increase by 90% in the period when the dumping claims are being made. What sort of injury are they suffering to see their gross income grow by almost triple digits?

Another issue with this is that the European e-bike industry makes in most cases extremely expensive machines. Lower priced e-bikes made in Europe are comparable in price to Chinese e-bikes but are honestly not as good as the ones made in China and once more their factories do not have the capacity to meet the demands of the growing European e-bike market.

Expect to pay £1750 or more for our base Raleigh electric bike models such as one of the Raleigh Captus machines. Someone with £2000 in their wallet and a clear conscience isn’t looking at the same machine as someone who might stretch to a £700 e-bike. That isn’t unlike someone with enough money for a Porsche looking at a Ford Fiesta as their main car. While having four wheels and an engine, they aren’t in the same market. Why then are the Porsche equivalent European companies attacking the Ford Fiesta equivalent e-bike companies? Over the next few articles we will look at this in detail and attempt to ask why…