home

In-Depth: Could Portland be America’s bike manufacturing hub?

Posted by on May 1st, 2009 at 9:51 am

[This article by freelance reporter Libby Tucker is the result of a collaboration between BikePortland.org and New Internationalist magazine. The NI -- which is based in Oxford, England and has an international circulation of about 65,000 -- will publish a version of this story in their June edition as part of a series of articles examining China's impact around the globe through the culture, politics and finance it exports.]


In the shop with Joseph Ahearne
Freshly brazed forks hang in Joseph
Ahearne’s shop in North Portland.
(Photos © J. Maus)

Shortly after Joe Bike opened in Portland as one of the few American shops outside Los Angeles to sell Flying Pigeon bicycles, an angry cyclist stormed in through the front door and demanded to know why the owner would buy bikes made in China. The country’s poor industrial labor conditions have long drawn scrutiny from international human rights organizations, and Flying Pigeon is a Chinese brand.

“He wanted to know if the Chinese workers have pension plans,” said Joe Doebele, owner of Joe Bike, which opened on Hawthorne Street in November. “The shop’s just getting started. We don’t even have pension plans yet.”

The outburst came as a surprise to Doebele, given that about six to eight percent of Portlanders commute by bike, compared to less than 1 percent nationally, and the city has carefully cultivated its image as a cycling mecca. He assumed it was common knowledge among Portland cyclists that most bicycles, including those sold by the major American brands like Trek, Specialized and Cannondale, come from factories in China and Taiwan.

Why, many local cyclists want to know, can’t Portland itself become a bike production center?

The city’s old-school cycling brigade, however, know that Portland has a long history of failure (re: Mountain Cycle and Kinesis) and success (Sapa Profiles and Chris King Precision Components) in attracting and keeping bike manufacturers. And the question still lingers among Portland bicycle enthusiasts and city officials whether Portland could become the next American city to build a bicycle manufacturing hub that rivals those surrounding companies like Giant and Pacific Cycles in Asia.

“Giant builds a better frame than anyone here. If you’re going to make things in this country and do a good job, the economics are rough.”
– Landon Holt, Tonic Fabrications

“The idea of a Portland-made bike within reach of the average Portlander is a cool idea,” said Landon Holt, a former product manager at Mountain Cycle and co-founder of Tonic Fabrications, a small frame builder in Portland. But, he says, “Giant builds a better frame than anyone here. If you’re going to make things in this country and do a good job, the economics are rough. You’d really have to do something unique, that’s for sure.”

Portland has more than a few hurdles to overcome. It’s been twenty years since most bikes sold in the United States were also made stateside by brands such as Huffy and Schwinn. The industry changed quickly over the past decade as the major brands chased low-cost manufacturing first to Taiwan and then to China. In all, the U.S. imported 200 times more bicycles than it exported last year, with 63,163 bike exports and more than 13 million imports in 2008, according to Bicycle Retailer & Industry News. 95 percent were shipped from China.

Now, the U.S. boasts several large dealers and about 100 mid-size brands that do at least some domestic manufacturing and a growing sector of craft builders that skillfully hand-file a few hundred high-end bikes a year. Portland alone saw the addition of 12 hand-built bike manufacturers in the last two years, a 340 percent increase from the five it had in 2006, according to Portland-based consultants Alta Planning and Design. But most mass-produced, affordable bikes are made in Asia by companies that contract with multiple brands.

Mountain Cycle shifted all their
manufacturing back to Taiwan
in 2006.

The factors that favor manufacturing in Asia are changing, however, and the trade imbalance is about to shift again, says Jay Townley, a prominent industry analyst and 52-year veteran of the bicycle industry based near Madison, Wis. The need for cheap labor has declined with automated factories, rising oil costs over the long term make overseas shipping less economical and American retailers want faster turnaround to boost gross margins on their inventory. For these reasons, Townley predicts large-scale bike manufacturing will return to the U.S. “in a bigger way” sometime within the next three years, bringing quality bikes to more mainstream consumers.

“All of the indicators prior to the global economic meltdown were that there was a potential for bike manufacturing to come back into North America,” said Townley. “I still think that’s viable. It’s now a question of how the economy shakes out.”

A recent “buy American” sentiment stemming from the global financial crisis would seem to support new efforts to manufacture within the U.S. Congressional leaders even briefly called for protectionist provisions in an early draft of the $819 billion economic stimulus package, which would have required new transportation projects to use American-made steel and iron. The provision failed, however, and consumers, despite their anger over labor conditions overseas, are still rarely willing to pony up extra cash for American-made products, said Michael Nover, former president of U.S. operations for Kinesis who’s now working outside the industry.

“The last thing I did before leaving Portland was try to get investors for a commuter bike line,” said Nover. “I couldn’t make a good business case to build here.”

Instead, the shift of manufacturing back to this continent will happen because U.S. factories can again compete on price and provide products that the market demands. In the 15 years since Nover moved to Portland, factories have become fully automated so that they employ significantly fewer people who require only a basic level of training. Labor costs have become a small slice of the total cost of bicycle production.

At the same time, bike shops are looking for ways to increase their inventory turnover, getting products on and off the shelves quickly when bikes are in demand. And consumers increasingly want “mass customization”, in which shops provide custom options for mass-produced bikes. These new retailer and consumer demands are difficult for overseas factories to meet with the long lag time and cost associated with what the industry calls putting bikes “on the water”. The move back to America is becoming financially feasible for manufacturers – but only if the location also makes economic sense.

“Manufacturing is manufacturing, It doesn’t matter if people love bikes in a market or not. It has to be somebody that knows how to do it.”
– Jay Townley, bike industry analyst

Portland – bike mecca that it is – will have to work hard to prove it’s the right place for mass production. And the pitch will likely come down to shipping costs, said Hu Tao, chief economist for the Policy Research Center for Environment and Economy with the State Environmental Protection Administration in China and a visiting professor at the University of Oregon. As a port city 100 miles upriver from the Pacific Ocean, Portland manufacturers can readily receive parts and materials from overseas. But Portland isn’t ideally situated as a distribution center for the entire North American market via highways and rail, especially compared to a Midwestern transportation hub like Indianapolis or Nashville.

Though he doesn’t rule out Portland, Townley thinks the next big North American hub will likely be in a large city somewhere in the Midwest or potentially in Mexico’s free-trade zones, which allow duty-free exporting. It also makes the most sense for an established Taiwanese or Chinese company to open a factory because they already understand how to achieve the efficiencies necessary to be profitable. Inefficient plant operation is what killed U.S. bike manufacturing, he said.

the new Trek
Trek’s Portland model is Portland
in name only.

“Manufacturing is manufacturing,” said Townley. “It doesn’t matter if people love bikes in a market or not. It has to be somebody that knows how to do it.”

Taiwan’s bicycle industry is a competitive force to be reckoned with. Its tightly clustered, efficient industry has been dubbed the A-team because of its coordinated efforts to assemble parts manufacturers, painters and other industry experts within an hour’s drive of the large assemblers. The industry has become so efficient that some 85 percent of Chinese bike manufacturers have signed onto joint ventures with Taiwanese companies.

“If you’re trying to compete as a bike company for highly educated, technically trained engineers, being in a place that’s good for bicycling is very important.”
– Tim Blumenthal, executive director of Bikes Belong

Despite the challenges, heavyweights in Portland’s bike industry and elsewhere think Oregon would be a logical place for bicycle manufacturing to rise again. It’s not an accident that Trek named one of its bikes the “Portland”; the city’s bike culture is already an inspiration to transportation planners and craft builders worldwide.

“If you’re trying to compete as a bike company for highly educated, technically trained engineers, being in a place that’s good for bicycling is very important,” said Tim Blumenthal, executive director of Bikes Belong, a national nonprofit advocacy group based in Boulder, Colo. “You can draw a more enthusiastic, talented labor force.”

The city, which ranks 13th in the nation for the number of manufacturers, has an established supply chain for metals manufacturers and a growing “bicycle industrial-complex” that could provide the foundation for a large bicycle manufacturer, says Jennifer Nolfi, design and creative services manager for the Portland Development Commission (PDC). Sapa Profiles is a frame builder and subsidiary of one of the largest aluminum extrusion companies in the world, Sapa Group. And Chris King. which relocated to Portland six years ago, is a mid-size manufacturer of headsets, hubs and other bicycle components. In all, manufacturing accounts for 20 percent of the Portland bike industry’s $90 million in economic activity.

Sean Chaney Vertigo Cycles-13
Sean Chaney of Vertigo Cycles
is an example of the depth
of bike building talent in Portland.

Portland has made some strides toward building its bike industry. In June 2006 the Portland City Council officially recognized “bicycle-related industry” as a strategic economic investment that would help the city’s larger goals of promoting bicycling as a transportation mode. And the PDC has since stated its intention to help make Portland the best city in the country for bicycle-related businesses, according to a recent draft of the city’s new bicycle master plan.

But Portland lacks a coordinated effort to promote the industry, instead leaving it to a so-far nonexistent statewide bicycle industry association to promote the sector.

“Having the bike industry be an important employer and sector of our economy fits right in with our vision of Portland as a world-class bicycling city,” said Ellen Vanderslice, project manager of the bicycle master plan update for the Portland Bureau of Transportation. But, she added, the “primary purpose” of the city’s bike plan is to make cycling a “real pillar of our transportation system” and not to build the bike industry.

That leaves it to state officials to sell Oregon as the best location for a large bicycle manufacturer. In the current economy, states are clamoring to bring in new companies and factories, domestic or foreign. And rising transportation costs and increased focus on climate change have the potential to create a much larger U.S. market for mass-produced, low- to mid-range bicycles designed for everyday use.

Oregon’s green business incentives are among the biggest in the nation, with a 35 percent business energy tax credit, for example. And the right combination of tax breaks and other incentives could prove enough to offset shipping costs and other imbalances, remarked Blumenthal of Bikes Belong. If the state rallies behind the effort and attracts a major bicycle manufacturer, perhaps one day the angry cyclist storming into Joe Bike will instead demand to know which Chinese-brand bikes are made in Portland.

– Today, the City Club of Portland will hosts 18 local bike builders and a panel discussion on Portland’s bike movement. The event will be available for download here and will be replayed on Oregon Public Broadcasting tonight at 7:00pm.

Email This Post Email This Post


Gravatars make better comments... Get yours here.
Please notify the publisher about offensive comments.
Comments
  • matt Rockweit May 1, 2009 at 10:18 am

    “and consumers, despite their anger over labor conditions overseas, are still rarely willing to pony up extra cash for American-made products,”

    An unfortuneate and all too common attitude here in this fine country. Everyone wants jobs, improved domestic economy and bad labor practices not tollerated. However everyone still wants something for nothing. You cant pay someone a living wage, give them benifits and provide for their retirement without it costing something! Textiles used to be manufactured in this country with pride and built to last. Older generations (not that long ago) were quite confortable and accustomed to paying for quality. Esepcially if that quality helped support their local economy and neighbors. This country needs a serious shift from disposable goods shipped in from other countries. American jobs will never exist if Americans are not willing to accept and provide what we demand from other countries.

    Recommended Thumb up 0

  • A May 1, 2009 at 10:53 am

    I agree with #1 …and there are millions of americans working for american companies manufacturing “american” goods with no pension plans. Hypocrisy of this nature makes individuals look incredibly foolish.

    Recommended Thumb up 0

  • tonyt May 1, 2009 at 11:03 am

    How much do you want to bet that the loud mouth who stormed into that shop was wearing shoes, pants and a t-shirt that were not made in the US?

    I’m all for buying a locally made product and will spend a bit more for it knowing that my money stays here. But I also have to face the reality of the market rules that are set up and understand that from a retailer’s perspective, there often just aren’t realistic “made in the US” options.

    There are a multitude of reasons that the vast majority of cycling products are made overseas, and it’s intellectually lazy to lay the blame at the foot of a small business like Joe Bike.

    Recommended Thumb up 0

  • Tommer May 1, 2009 at 11:15 am

    I would like to see UBI open a campus in Portland that includes high school classes in conjunction with mentorships and internships to create a workforce of highly skilled/qualified mechanics and builders that could support a bike industry in Portland.

    Recommended Thumb up 0

  • Schrauf May 1, 2009 at 12:19 pm

    Another great article by Libby Tucker. We want more Libby!

    – We want more Libby too Schrauf! We’re working on finding a sponsor for the In-Depth section so we can keep her (her great reporting isn’t free). — Jonathan

    Recommended Thumb up 0

  • Anonymous May 1, 2009 at 12:30 pm

    Tommer,

    Unfortunately the people needed to support a bike industry (manufacturing) in Portland are not bike mechanics. Portland is loaded with bike mechanics and sales people working in the retail bicycle industry. All selling and maintaining those products manufactured somewhere other than the US. We are lucky to have the choice of so many stores in this area.

    What you are looking for are engineers, machine operators, designers etc etc etc who can come here and start up a company that will manufacture bicycles and parts locally.

    In that realm we are lucky to have Chris King in Potland manufacturing hubs, bottom brackets, wheels, and now bicycle frames.

    http://chrisking.com/

    http://cielo.chrisking.com/

    Recommended Thumb up 0

  • RonC May 1, 2009 at 12:31 pm

    Are there any production/non-custom bikes still made in the USA?

    Recommended Thumb up 0

  • Paul Tay May 1, 2009 at 12:38 pm

    Need cheap labor?

    Recommended Thumb up 0

  • Shawn Small May 1, 2009 at 12:44 pm

    This articles brings a lot of the industry issues to the surface.

    From working in a lot of different sectors of engineering/manufacturing in the midwest I see Portland as a tricky area. Comparitively there is minimal manufacturing incentive to move here. Tax incentives are unclear and hard to find and there just isn’t a lot of industry support here yet.

    I have a lot of hope for the area, as the article points out there are a lot of great companies here and doing well. It is partially up to the riders to choose a local made part but not have to sacrifice quality to do so. It is also up to the smaller manufacturers to keep innovating.

    I specifically moved to Portland to found my 1 man (no pensions either) company to be surrounded by the cycling community. One of my primary means of development is the feedback I get from the riders at races, on the street, at bars, coffee shops, our new local race team, etc. The more feedback the better!

    While we may not have the industry support yet, we have one of the best resources available and that is our cycling community.

    Recommended Thumb up 0

  • Bent Bloke May 1, 2009 at 1:22 pm

    @RonC #6

    Not exactly high-volume/mainstream, but my Rans recumbent was made in Kansas. They have quite a few models, so they must have some kind of production-line set up.

    http://ransbikes.com/

    Recommended Thumb up 0

  • middle of the road guy May 1, 2009 at 1:22 pm

    I predict that many of the custom frame shops will close in the next 18 months.

    In the mid-90′s, there were a lot of custom builders. The market for custom bikes really could not support that many manufacturers – hence they went under.

    I think there is a lot of projection that goes on with wanting Portland to be a major player in the bike industry.

    The majority of bicycles being ridden in town are old. Much of the market simply is not going to buy a new bike.

    If someone is going to drop good money on something new, they are going to get as much as they can for their money – simple economics. It’s projection to assume that just because *you* (literary “you”) might pay more for something produced locally or that a portion of the funds go to a cause, someone else will. Most people can’t afford that luxury.

    Recommended Thumb up 0

  • Blah Blah Blah May 1, 2009 at 1:22 pm

    To Ron C

    Yep.

    Turner
    Titus
    Litespeed/Merlin
    Ventana
    Ellsworth
    Foes
    Moots
    Seven
    Intense
    Sinister
    Knolly

    These are just a few off the top of my head.

    I almost always buy Made in the US first and then try to buy something that is not farmed out to a 3rd world manufacturer second. Not that I don’t think these people don’t deserve to make a living, but it’s just not a fare playing field. Most of these places don’t have enviromental standards, mininum wages, and health standards like we do in the US.

    Recommended Thumb up 0

    • middle of the road guy October 11, 2011 at 3:41 pm

      You forgot Indy Fab.

      And I think several of those companies were not around in the mid-90′s.

      Recommended Thumb up 0

  • Anonymous May 1, 2009 at 1:22 pm

    Ron C,

    Trek still manufactures their Madone line in the US, the 5.x and up models.

    Recommended Thumb up 0

  • Bent Bloke May 1, 2009 at 1:22 pm

    @RonC #6

    Not exactly high-volume/mainstream, but my Rans recumbent was made in Kansas. They have quite a few models, so they must have some kind of production-line set up.

    http://ransbikes.com/

    Recommended Thumb up 0

  • ScottG May 1, 2009 at 1:22 pm

    Trying to post this comment again…hope it’s not a double post.

    One of the reasons why so much manufacturing is done in China is that environmental regulations are so lax there. People driving around in their “green” Priuses would be shocked to learn how the manufacture of their batteries has devastated the landscape and wildlife where they are built in China.

    I generally support capitalism and free trade, but the biggest problem is how to incorporate the cost of environmental damage into the price of products. If that could be done effectively, it would provide a market incentive to do more domestic manufacturing and discourage the waste of oil resources moving stuff halfway around the world.

    Just my two cents.

    Recommended Thumb up 0

  • Paulo May 1, 2009 at 1:22 pm

    Re: Are there any production/non-custom bikes still made in the USA?

    I believe Klein bikes are still made in the US, even though they are now owned by Trek.

    Recommended Thumb up 0

  • ScottG May 1, 2009 at 1:22 pm

    One of the reasons why so much manufacturing is done in China is that environmental regulations are so lax there. People driving around in their “green” Priuses would be shocked to learn how the manufacture of their batteries has devastated the landscape and wildlife where they are built in China.

    I generally support capitalism and free trade, but the biggest problem is how to incorporate the cost of environmental damage into the price of products. If that could be done effectively, it would provide a market incentive to do more domestic manufacturing and discourage the waste of oil resources moving stuff halfway around the world.

    Just my two cents.

    Recommended Thumb up 0

  • Evan May 1, 2009 at 1:28 pm

    Unfortunately Klein and Lemond no longer exist and very few Trek’s are made in the U.S. Cannondale also has closed their plant in PA and is moving all production overseas. It’s a shame to see it happen.

    Recommended Thumb up 0

  • Paul Tay May 1, 2009 at 1:31 pm

    Prius drivers are holier-than-thou hypocrites.

    Recommended Thumb up 0

  • Mike May 1, 2009 at 1:37 pm

    #17 +1

    So are people with hyperlinks to really old unupdated blogs.

    Recommended Thumb up 0

  • Mike May 1, 2009 at 1:40 pm

    Sorry, meant #20.
    For 17, Trek is still producing stateside, while Klein does not really exist in the US market. It has been gone for a few years now.
    Co-motion does stock sizing bikes. That is pretty local. There are dozens of US non-custom bike makers. But they still cost $$$.

    Recommended Thumb up 0

  • jeff May 1, 2009 at 2:02 pm

    My Canondale (’05) was made in the US, and my Schwinn Homegrown (’99) in Portland, both production frames. But now both are made overseas.

    Recommended Thumb up 0

  • Matt Picio May 1, 2009 at 2:03 pm

    tonyt (#3) – He was almost certainly wearing shoes made in China – China manufactures something like 80% of the world’s shoes now. Unless you buy something handmade, shoes are not manufactured in the US anymore. Ditto for televisions (you think he has a TV?) – the last US plant closed in the 1990s.

    middle of the road guy (#11) – Unless the economy suffers a lot more than it has so far, I don’t think I agree with you. A few of the builders had to stop taking orders, and at least 1/3 of the builders in Portland have at least a 3-year backlog in orders. A lot of people want bikes built by Ahearne, Pereira, Vanilla, and Sweetpea, and others who I’m forgetting (sorry). There’s a lot more pent-up demand than 18 months’ worth.

    Now if you predict many would close in 5 years, I think that might be more reasonable – and in some cases that might be true simply because of burnout.

    Recommended Thumb up 0

  • beth h May 1, 2009 at 3:02 pm

    “The idea of a Portland-made bike within reach of the average Portlander is a cool idea,” said Landon Holt…

    *****

    First, we need to define “the average Portlander”.
    Are we talking education, occupation, income or neighborhood of residence? Or a combination of all four?

    So often the bike-centric media portray “the average Portlander” as white, under 40, educated and living in a house or condo on the inner eastside (particularly southeast). They tend to have fewer children than the national average. Further, lots of these “average Portlanders” may also be classified as being members of the so-called “creative class”.
    And perhaps, even in this toilet economy, they still earn enough money to buy American most of the time.

    As for the rest of Portland’s residents — the unemployed or underemployed, those living in mid-county or east county where cycling conditions aren’t nearly as good, and perhaps with more children and/or elderly parents to support. I can tell you that they are probably NOT buying American, or even worrying about it. If they can afford to shop at all, they’re buying bikes at WalMart and Costco, or at yard sales.

    While I’d like to think that all of these excellent local bicycle-making companies will survive, common sense and the crummy economy suggest otherwise. The smart bike businessman will recognize that the working class is an untapped segment of the market, and will find a way to reach them and help get more of them on bikes — ANY bikes.

    Recommended Thumb up 0

  • Diogo May 1, 2009 at 3:16 pm

    It doesn’t make sense to me that, out of expressed concern for the unprotected workers of the 3rd world, people would boycott their products, threatening the job’s of those same workers. Does anyone really believe that a Chinese worker would rather not have a job than having an “underpaid” job?

    Americans have benefited greatly from free trade and cheap Chinese labor – I don’t see people wanting to give up the privilege but everyone complain about jobs going overseas.

    Things just are not that simple. For all its faults, China has lifted millions of people out of poverty. And many 3rd world countries have better labor protection than the US. And regarding the environment, the US still is one of the biggest polluter and CO2 emitter. Should we boycott American-made bikes because of that?

    Recommended Thumb up 0

  • Paul Tay May 1, 2009 at 3:57 pm

    #20, Mike, yep. I deserved that!

    Recommended Thumb up 0

  • RonC May 1, 2009 at 3:59 pm

    Hey everybody. Thanks for the info on US Made bikes. Jeff (#22) makes the point I was more concerned about. While there used to be quite a few mainstream options that weren’t outrageously expensive, that’s becoming less and less the trend. Just saying it might be quite difficult to build a local economy on the tail-end of that trend. It would be nice if my concerns were proven wrong.

    Recommended Thumb up 0

  • Borgbike May 1, 2009 at 4:10 pm

    Inspirational article. A message I take home from it is that that if there were some good government leadership we have sufficient critical mass to make something happen here.

    My personal anecdote: I went into a small shop the other day to buy 2 new sets of brake pads. I asked if they stocked Kool-Stops, U.S.-made pads made here in Lake Oswego, OR.

    The shop owner asked me why I wanted them and I sheepishly stated that I wanted to buy something local and U.S. made. I didn’t go into my reasons but, just for the record, it wasn’t simplistic flag-waving nationalism.

    I got a very disdainful response that nothing is made in the U.S. anymore so why bother.

    I asked if he could order these from a distributor so I could pick them up next week or later. He said that he wasn’t willing to do that but he would call another shop to see if they had them.

    I didn’t press the issue and bought the pair he had in stock. Later I called Kool-Stop to see who the local Portland distributor was. I called the distributor and confirmed he delivered to the shop and that there was no delivery charge.

    I didn’t mention to the shop owner that I specifically went out of my way to support him because he was a small local independent shop.

    Sometimes we fail to see the forest through the trees! Support your local bike shop and teach your local bike shop to support the local bike industry!

    Recommended Thumb up 0

  • Borgbike May 1, 2009 at 4:11 pm

    Inspirational article. A message I take home from it is that that if there were some good government leadership we have sufficient critical mass to make something happen here.

    My personal anecdote: I went into a small shop the other day to buy 2 new sets of brake pads. I asked if they stocked Kool-Stops, U.S.-made pads made here in Lake Oswego, OR.

    The shop owner asked me why I wanted them and I sheepishly stated that I wanted to buy something local and U.S. made. I didn’t go into my reasons but, just for the record, it wasn’t simplistic flag-waving nationalism.

    I got a very disdainful response that nothing is made in the U.S. anymore so why bother.

    I asked if he could order these from a distributor so I could pick them up next week or later. He said that he wasn’t willing to do that but he would call another shop to see if they had them.

    I didn’t press the issue and bought the pair he had in stock. Later I called Kool-Stop to see who the local Portland distributor was. I called the distributor and confirmed he delivered to the shop and that there was no delivery charge.

    I didn’t mention to the shop owner that I specifically went out of my way to give my business to him because he was a small local independent shop.

    Sometimes we fail to see the forest through the trees. Support your local bike shop and teach your local bike shop to support the local bike industry!

    Recommended Thumb up 0

  • FK May 1, 2009 at 5:11 pm

    as a former kinesis employee, all i can say is that was a pretty big factory and the bikes were still pretty top of the line… Ibis, Storck, GT Monocoques, S&M BMX. i’d think to match the price points of overseas manufacturrs you would have to build a huuuuge factory.

    also, the dude who sweated Joe’s shop sounds like an uneducated major league a-hole.

    Recommended Thumb up 0

  • Scott Mizée May 1, 2009 at 5:36 pm

    note: in follow up to the comment at the end of the article… Today’s City Club Friday Forum is also viewable on Cable Television

    Portland Community Media
    Channel 30
    Delayed broadcast same Friday, 8:00 PM
    Sundays, 4:30 PM
    Thursdays, 6:00 PM
    Channel 11
    Delayed broadcast following Friday, 12:15 PM

    Recommended Thumb up 0

  • unotache May 1, 2009 at 6:43 pm

    With all due respect, I find that this article misses the point. Since when did industry=manufacturing.

    [Thanks unotache, I agree. I changed the headline (I love not having an editor). Thanks. -- Jonathan]

    Recommended Thumb up 0

  • tonyt May 1, 2009 at 8:11 pm

    I have to share my experience with the city of Portland.

    A number of years ago 2005ish, I was pretty serious about trying to start what might be best described as an American Surly bike company with only a slightly higher price than Surly. I did quite a bit of research, took classes at the SBA, was working on a business plan, and worked my way through the PDC and eventually got a meeting with Maria Thi Mai, who at the time was Senior Policy Director for then Commissioner Adams.

    Long story short, after I explained my vision for this company, the very essence of which would rely on it being made here in the states, she walked across her office, picked up something, I think it was an artificial hip or something like that, and proceeded to tell me how this thing was formed in China, but then brought here for finishing and perhaps I could do something like that.

    I took a deep breath and told her that the very point of this company would be to build a bike HERE, and that if it were made in China it would lose all value and that I had NO intention of making anything there.

    So the conversation continued, and what I told her I needed most was help in finding a location and perhaps even some tax breaks (funny how they’ll suspend property tax for 10 years for condo dwellers in the Pearl, but manufacturing ????). If I could get some numbers to shift, I might have a chance.

    Sensing that perhaps real estate in Portland proper might be out of my league, I suggested that perhaps we could find something in Gresham. Wouldn’t it be great I said, if the Portland bike industry could bring manufacturing jobs to Gresham? Might that also help bridge the cultural divide between what is often seen as yuppie Portland and working class Gresham?

    And without blinking an eye she stated that her office was there to help Portland, not Gresham.

    At which point I had to call her out. Not 10 minutes before, she had essentially tried to convince me to set up shop in China, but now, Gresham was off-limits???

    She really didn’t have anything to say at that point. There really wasn’t anything she could say. I can’t remember what we talked about next, but over the next few months, I talked with a lot of people who were involved in bike manufacturing, and to a person, they all said to forget it. There was no way I could compete with the labor price available in China.

    Anyway, that’s my story. The paradigm is that China is where you go. That’s where things are made. Even the people who are hired by this city to promote industry have apparently thrown in the towel on manufacturing.

    It’s a shame.

    Recommended Thumb up 0

  • eileen May 1, 2009 at 8:25 pm

    this is such a complicated issue for me. I guess I don’t see borders and I don’t see what is so wrong with things being made in China. I do think companies should oversee Chinese operations and ensure that safety standards are being met, and laborers are fairly treated. And I get the whole shipping thing, but I’ve also heard that sometimes buying local and making lots of short trips in small vehicles ends up using more resources than mass shipping from the other side of the world. I just don’t like the attitude that made in china = bad because it makes me wonder if there isn’t some ethnocentrism behind that feeling. If we’re worried about the chinese workers being treated well, why would taking their jobs away make things better for them? Maybe there’s another way to go about it.

    Recommended Thumb up 0

  • Lazy Spinner May 1, 2009 at 9:11 pm

    Lest we forget that China supports Oregon’s economy by buying massive amounts of agricultural products produced here. Products harvested by low wage workers with no pension plans I might add. We are not lilly white and pure either.

    Recommended Thumb up 0

  • Joe Doebele (Joe Bike) May 1, 2009 at 9:14 pm

    I remember telling the gentleman that none of us at the shop have health insurance, let alone a pension plan. And that the factory’s milkshake stayed in China rather than getting sucked out by shareholders or owners in the US, as would be the case if he were to buy, say, a Trek. And that the money I wired to China most likely went much further over there in terms of basic needs for more people than it would have over here.

    Still, my first choice would be to not only sell American-made bikes, but to make American-made bikes. After spending months researching the feasibility of doing a small production run (100) of the modular cargo bike called the Joe Bike here in Portland, I have to say that I don’t see much evidence to support Mr. Townley’s optimism, though I guess he was referring to the Midwest. My experience so far is that welders in Portland who have their own equipment and can braze are commanding at least $50 an hour. Not only is the cost difference between Taiwan and Portland for such production almost beyond belief at this point (even after factoring in shipping and Customs), but the amount of work required to get it rolling here will be enormous. In contrast, working with a manufacturer in Taiwan is (once you have a trustworthy contact), largely a matter of pushing buttons–emails, CAD drawings, wire transfers.

    I’m still very new to all this, but it seems to me that what would change the equation at least somewhat is having either a big-label manufacturer here that’s open to doing small runs of bikes that are not their own, or, better yet, a no-label manufacturer that can take Portland bike builders’ design ingenuity and make those bikes with great efficiency.

    And Borg, come to Joe Bike for your brake pads. We go out of our way to use and stock Kool Stop, both for their superior recipes and because their R&D and manufacturing are done in Lake Oswego. It was inspiring to tour their plant and pass by large shipments of Kool Stops ready for export to the world’s highest-end bicycle factories (most of them in Asia).

    Recommended Thumb up 0

  • Dan Hawk May 1, 2009 at 10:29 pm

    I don’t know that I fit into the “average Portlander” deal, but I definitely can’t afford any of the bikes made locally now. I have a pretty nice bike that I saved for and love. It happens to be an American built Trek Portland, (which they no longer build in the US) covered in foreign built parts. the Sticker on the chainstays even says “Handcrafted in the USA (of Domestic and foreign parts)”

    That is not to say that I wouldn’t love to own a really cool Hand-Built -in-Portland Bike, but I think that it would be really cool if there was a good $1000-$1500 production bike built here with good midline components like Shimano’s 105 line.

    I think that it is pretty cool that such an amazing line of parts as the Chris King stuff is built here and I hope to build a second set of wheels with some great colored hubs this summer when I save up enough.

    Anyway, all of that to say that I’m a little torn about it. As was already mentioned in the comments, it is ultimately about value for your money and quality components for your ride. I try to judge it holistically. I’ll buy the foreign stuff if it is better quality or if the domestic stuff is way overpriced.

    Recommended Thumb up 0

  • Tonic Fab May 1, 2009 at 11:41 pm

    While I was honored to be interviewed for this article, I’d like to clarify a few things.

    My only condition for participating in this interview was simply to have the chance to review it prior to publishing.

    For some reason, this did not happen.

    The following are edits I would have made:

    First: The name of the company is Tonic Fabrication, not the plural.

    Second: I’m an engineer, not a product manager.

    Last year Tonic sold over 150 frames, so we aren’t the largest PDX area producer, but far from the smallest either.

    Yes I think Giant is making some incredible bikes.

    Better than anyone in this country?

    “Better” as defined by a composite of manufacturing expertise, the ability to design, market and service a relevant and affordable product, then, yeah, they are doing a very, very good job.

    Beyond clarifying my “quote” in this article, I’d like to remind people of a simple truth.

    The local bike industry doesn’t need anything any other business doesn’t

    If the the municipal government is looking to help the local bike industry, controlling health insurance costs would be good start!

    -L

    [Landon. Sorry that your company name was wrong, I should have caught that. I have made the edits to the story. Thanks for the comment and I'll see you around. Cheers, -- Jonathan]

    Recommended Thumb up 0

  • Tony Fuentes May 1, 2009 at 11:45 pm

    This was a very compelling article, thank you for posting it.

    I am not in the bike business, I am in the baby business which is another industry that many have “given up to China”. I have to say that in my experience the “it has to be made in China” argument is both specious and self-defeating.

    Over the past five years, we have managed to keep our shelves pretty clear of items made in China (we presently have one Chinese made product out of hundreds of product lines) and require that all product lines we carry adhere to positive labor standards and practices.

    It takes a little more thought, a little more rigor, and sometimes it means forgoing a new “hot” item but on the other hand we have established some brands and products in the Portland market solely because we took the time to seek out products that met our standards and values.

    The same is true for bikes. It is not that challenging to find bicycles that are mass-produced outside of China or Taiwan. For example, Batavus are made in Holland, Cycleurope (which has many brands including Bianchi) has production facilities in Denmark, France, Italy and Sweden, Trek still makes bikes in Wisconsin, and there is no shortage of small builders in Oregon, California, and elsewhere.

    Contrary to popular opinion, “made in China” does not automatically equal lower pricing.

    For instance, we had to drop a product line that was purchased by a larger company who moved the operations from Canada to China. They closed down a manufacturing plant in BC that has been in operation and profitable for more than a decade and contracted out the work to Chinese facilities. However, neither the retail nor wholesale prices changed.

    Basically, they bought the brand and its image and they are undertaking a strategy to maximize profits off those assets. This is pretty common and it is basically what is happening to Cannondale now; their Bedford, PA plant will be closing now that they have been purchased by the same conglomerate that owns the Mongoose, GT, and Schwinn brands.

    So things can be made outside of China and folks are willing to pay a fair price for the right brand (of course quality matters but it is generally an inherent characteristic of a brand). What does all this have to do with bike manufacturing in Portland or Oregon?

    Just like micro-brews, Oregon and Portland are trusted brands when it comes to bikes. When it comes to biking, Portland and Oregon invoke an image and that is attractive with regard to bikes.

    This is why, just like with micro-brews, Portland and Oregon as brands are sometimes being co-opted by companies that make nothing in Portland or Oregon. Arguably, some companies set-up an office here solely to put a Portland-sheen on their products.

    The bike industry in Oregon is $150 million per year. There is no reason why it can’t grow to $1 billion or more in the next five years. With targeted technical support and ideally some industry organization, it could grow way beyond even that target. However, broader manufacturing really needs to be a part of this growth and since “Portland and Oregon” already have a built-in value when it comes to bikes not doing so seems like a missed opportunity.

    Ms. Tucker’s article points to some of the challenges in this regard but it also underscores these unique qualities that puts us in the right position to make it happen here. We have the branding, the cred, the designers, the fabricators, the resources, and more.

    Human-powered economic development, Made in Oregon. We can do it.

    Recommended Thumb up 0

  • Tonic Fab May 2, 2009 at 12:04 am

    Tony Fuentes:

    10-4.

    Your eloquence and business sensibility rings clearly here. Thank You.

    Jonathon: Hey, no harm, no foul! The benefits of your site dwarf my minor issue with this article.

    I expected this article to be provocative, so let it roll!

    -L

    Recommended Thumb up 0

  • jim May 2, 2009 at 2:36 am

    Re: Are there any production/non-custom bikes still made in the USA?

    when I was a teenager I mowed lawns all summer and went and plopped my money down and bought a new Rollfast 10 speed (like the bikes in the “breaking away” movie) because my dad said to buy something made in this country so it could be repaired… After a couple of weeks the crank froze stuck and they said 2 month wait for parts. We went back to the bike store and exchanged it for a used Peugoet. 35 yrs later I still have the Peugeot and it works just fine.

    Recommended Thumb up 0

  • Dave May 2, 2009 at 8:53 am

    I don’t know the current cost, but in 2001 it cost $3k to ship a container of freight from China; in 2008 at the peak of oil prices it cost $8K. For more Americans to decide that bikes are worth more money, they’d have to decide that bikes are real vehicles. Most Americans are still too fucking stupid to realize that.

    Recommended Thumb up 0

  • Scott Mizée May 2, 2009 at 11:03 am

    wow… thanks for your comments, Tony. Very educational and inspiring.

    Recommended Thumb up 0

  • twistyaction May 2, 2009 at 11:36 am

    In the first picture, I believe those are freshly brazed forks as opposed to welded. Different method of joining pieces of metal. Brazing uses a dissimilar metal with a lower melting point, while welding uses the same metal, melted to join.

    Also, I know it’s young, but Oregon does have a bicycle constructors’ association, the OBCA, which the article states does not exist.

    Recommended Thumb up 0

  • Bill May 2, 2009 at 11:59 am

    Tony & #1
    word up!

    Id like to touch on something since I have heard so much in this article about Trek’s manufacturing stateside. One gentleman used the term “made of foreign and domestic parts”. This is definately one of the “tools” used by several manufacturers such as Santa Cruz and Trek to make them appear to be more US built than what is reality. by putting this label on their bikes, they can get away with building the bulk of the bike overseas and having a particular percentage done in the US to qualify as US made or so they can tout, “made of foreign and domestic parts”. This may seem like Im being nitpicky, but there is definately a game being played by several bike manufacturers. It helps make them appear to be more US produced than what they actually are. I wish brands would own up 100% to the choices they make. Then consumers that care about these things can make better decisions.
    commenters did a great job in listing larger production brands that have gone to great lengths to do all their production stateside. So, kudos to those brands:

    Turner
    Titus
    Ventana
    Ellsworth
    Foes
    Moots
    Seven
    Intense
    Sinister
    Knolly
    Commotion
    Santana
    Independent Fabrication
    Litespeed/Merlin (most of their bikes)

    Recommended Thumb up 0

  • jim May 2, 2009 at 2:30 pm

    Maybe if all these local manufacturors were to work together they could reduce their costs and be more competitive and have better opportunities… Perhaps one guy would make forks… One of the mexican guys I know came from a town where they make guitars, everybody does different parts and it keeps everyone employed

    Recommended Thumb up 0

  • Joe Doebele (Joe Bike) May 2, 2009 at 3:05 pm

    Response to Dave 43. A large (40-foot) container cost $2400 to ship from Tianjin to Portland in Sept/Oct 2008, just a bit below the peak in oil prices that year.

    Recommended Thumb up 0

  • Faux Porteur May 2, 2009 at 4:12 pm

    I think Bike Friday in Eugene is a good model. I wonder if anyone has tinkered with their system and worked out some numbers for Oregon made big wheel (26″, 700c) bikes. Most of the builders in town are purely custom-builders.

    If a company could assemble of a team of;
    1. several master builders/designers to design the stock/semi custom frames.
    2. some apprentices (to do the super-time intensive but may-not-so-skill-intensive work of bicycle frame building, and learn the
    3. sales people (let the builders build, let the sales people sell)
    4. painters (or most likely powder-coaters)

    I think they could really crank out some quality bikes in good numbers. They’d also be able to offer modification (braze-on additions, etc…), repairs and painting services. Most of the frame builders in town have their schedules too full to do repairs/modifications.

    But if there was a semi-affordable stock/semi-custom frame made in Oregon, where are the components going to come from? Most of the US made stuff is usually really high-end stuff, with a high-end price tag. Phil Wood, Chris King, etc… I doubt many American companies would start up with the “made in the US like Phil Wood, but, not quite as nice, but its only 60% the price!” tag attached to them.

    Factory financing would be a big help too. Yes, few Portlanders (and Americans in general) can afford $1500+ bikes up front, but maybe 25% down and decent 3 year financing could make it a reality for many more.

    Think where the auto-industry would be without financing.

    One of the credit-unions in town offers a bike loan. Decent rates I think too.

    Recommended Thumb up 0

  • Unorache May 2, 2009 at 4:38 pm

    Um.. you all realize that even If a bike’s frame is “made” stateside, nearly all of the components, and a good chunk of the overall “cost” would originate from Asia.

    Recommended Thumb up 0

  • She May 2, 2009 at 4:53 pm

    Borg

    Why not tell the shop person that you went to them b/c they were a small independent shop? I think we should let shops know why we shop where we shop!

    Recommended Thumb up 0

  • Dan Hawk May 2, 2009 at 10:00 pm

    Unorache, I was kinda thinking the same thing today. I was the one who mentioned the “Hand Built in the USA of Domestic and foreign parts” thing.

    Even the highest end of Hand built Portland bikes are going to end up with a smattering of Foreign parts. I’m not really aware of a drivetrain setup (derailleurs, shifters) that is produced stateside and is available in the numbers that a production line would require.

    I also love Faux Porteur’s ideas…sounds really cool. I’m hoping that I get to see that one day and ride one of those bikes!
    I think that the idea of Portland Built will be defined as frames designed, welded, painted and assembled here at home with a combination of American built and imported materials.

    I know that there have been and continue to be small batch builders of drivetrain component out there, but nothing with the sort of market penatration and ubiquity as companies like Shimano, SRAM, and Campagnolo.

    Recommended Thumb up 0

  • jim May 2, 2009 at 11:59 pm

    Irregardless of where the parts come from, if we build frames and assemble the parts… it is a good industry for portland

    Recommended Thumb up 0

  • red hippie May 3, 2009 at 1:52 am

    1. In many ways, Taiwan is more of a first world country than the US is. They actually have a reasonable social health care mechanism, so employees don’t need employer supplied health care.

    2. A lot of the industry in Taiwan is highly productive with a combination of design, engineering, fabrication in one physical location. The system has evolved to make it easy to do business. This is the same reason a lot of shoe and apparel design and manufacturing occurs in the same way.

    3. Joe bike imports the same cargo bikes that were banned in the Netherlands for patent infringement. There has been a lot of flooding of the european marked with cheap, knock-off, bikes. The Dutch were pretty smart to protect intellectual property and it helped to level the playing field for the market and keep many of the european companies viable. Too bas, we don’t do the same here.

    Recommended Thumb up 1

  • Bill May 3, 2009 at 5:45 pm

    let it be known: when a frame says, “made of foreign and domestic parts”, they are speaking of the frame itself. This has nothing to do with the components of the bike. If one believes this means the frame is made in the US and the parts are the foreign produced segment, that is incorrect. It means a good portion if not most of the frame was made overseas. Then, a given percentage is finished and considered US made, or Spanish made, or Italian made, or “made of foreign and domestic parts”. Depending on the country of origin, this can mean as little as paint application, it can mean you glue part of a frame together, or you weld two frame halves together, it can also mean that a fair amount of time goes into quality check when the frame arrives. This is as loose as the countries laws regarding the use of “made in” stickers.
    think your Orbea is made in Spain? check out the site below. they try to list the countries of origin of many popular big brands.
    http://allanti.com/page.cfm?PageID=328

    Recommended Thumb up 0

  • carless in pdx May 3, 2009 at 10:52 pm

    Please support your local bike builders. Rob Tsunehiro of Tsunehiro cycles has some of his latest creations on display at Legare’s, a coffee shop at 16th and Clinton.

    Recommended Thumb up 0

  • Loren May 3, 2009 at 11:34 pm

    Support your local economy and environment! CRAIGSLIST!!!!

    Recommended Thumb up 0

  • KWW May 4, 2009 at 6:03 pm

    The poster children of ‘Oregon Business’ are Nike and Adidas, who put off-shore manufacturing on the map.

    btw, I have seen a Flying Pigeon up close, and I was amazed at the quality of the paint job and spec. Too bad it is one size fits all…

    Recommended Thumb up 0

  • carless in pdx May 4, 2009 at 7:48 pm

    re #48-

    My Credit Union, Unitus, actually offers a bicycle loan program. It can also cover accessories if you lump them in with the purchase of a new bike. Here it is:

    http://www.unitusccu.com/bike/how_it_works.html

    Recommended Thumb up 0

  • Pat Franz May 4, 2009 at 8:51 pm

    I don’t know that trying to get a big bike manufacturer to put a factory in Portland is such a good idea. I think it is more “Portland”, and more likely to be successful, to work to grow what we have and attract those that are already attracted.

    I think that getting the right collection of businesses together and nurturing them would create quite a stir. Make it so small manufacturers would have everything they need infrastructure wise, so they could be efficient and focus on making whatever the market calls for. Some will make it big, some won’t, but everyone will benefit from the ease of sourcing and the general level of expertise.

    Passion is important, but once you reach a critical mass in infrastructure and expertise, things can really take off. And this sort of thing is much sturdier long term than one big manufacturer with one ear always listening to the siren song of overseas manufacturing. We have lots of passion now, and the infrastructure and expertise levels are coming along. With some prudent coordination things could really gel.

    We make bike parts in Portland, and our business has been growing really well for 13 years now. Part of it is being connected to a lively cycling scene, so we know early on where things are going and what people need. Another part is being able to buy and get things done locally. And lastly, no small part of it is due to the “buzz” that everyone from customers in Frankfurt to the banker down the street feels about what’s happening in Portland.

    Encourage that, and we’ll really have something.

    –Pat Franz
    TerraCycle, Inc.

    Recommended Thumb up 0

  • carless in pdx May 5, 2009 at 2:55 am

    Pat-

    Not everyone can shell out $2-3 thousand for a city bicycle. I believe the point of a medium-sized manufacturing facility is to bring about cost savings to allow more people to afford the bikes produced there.

    It’s all about volume… how many years would it take you to produce a bike for every person in your neighborhood? The city?

    Recommended Thumb up 0

  • Pat Franz May 6, 2009 at 9:24 pm

    I wouldn’t presume that what people need is a volume manufactured “city bike”. I think people need all kinds of bikes. The mass market kinds are already covered. The unique, creative, niche market kinds are not. This is where I think Portland can make a mark and how Portland can be a viable manufacturing center.

    –Pat Franz
    TerraCycle, Inc.

    Recommended Thumb up 0

  • [...] visit to Portland prompted a few unique questions, such as whether jobs at a vegan strip club or bicycle manufacturer should be considered “green” jobs: “I’ve always thought about “green [...]

    Recommended Thumb up 0

- Daily bike news since 2005 -
BikePortland.org is a production of
PedalTown Media Inc.
321 SW 4th Ave, Ste. 401
Portland, OR 97204

Powered by WordPress. Theme by Clemens Orth.
Subscribe to RSS feed


Original images and content owned by Pedaltown Media, Inc. - Not to be used without permission.