Another Taiwan Bike Maker to Move to Cambodia

By Jack Oortwijn 7 Feb 2013

 

PHNOM-PENH, Cambodia – It’s not finalized yet as contracts still have to be signed, but it looks as if another bike maker from Taiwan is setting up shop in Cambodia. It will be the 4th one which is to benefit from the duty and quota free status Cambodia made bicycles have in export to Europe.

Currently Cambodia is the second largest exporter of bicycles to the European Union after Taiwan. - Photo: Bike Europe

Currently Cambodia is the second largest exporter of bicycles to the European Union after Taiwan. The Kingdom's export almost tripled in the first half year of 2012 to 519,389 units, according to Eurostat data. Average unit value during that period increased 34% to €191 compared to the same period in 2011.

Three Taiwan makers
Three Taiwanese-owned bicycle manufacturers are operating in Cambodia. They are Atlantic Cycle and its subsidiary A&J, Smart Tech (Cambodia) and Worldtec Cycles (Cambodia). While Atlantic Cycle Co and its subsidiary A&J have been manufacturing in the Kingdom for seven years, Smart Tech moved to Cambodia from Vietnam two years ago.

4th one
And it looks as if the 4th Taiwan based maker is on the way to Cambodia. Ly Hua, an official at Tai Seng Bavet Special Economic Zone, said: "There is another Taiwanese investor interested in setting up a factory here, but no contract was signed yet."

Labour costs

Next to the import duty free status for bike export to the EU (which saves 14% import tax on complete bikes), bicycle manufacturing in Cambodia is benefitting from low labour costs. Minimum wages in Cambodia are set at just US$61 per month. The minimum wage in Thailand was recently raised to 300 baht per day (US$10) and salaries in China in the bike business have risen to US$400 per month.