Can Taiwan’s leading ICT sector revitalise the e-bike industry?

Taiwan’s leading role in the international market for ICT products could play an important role in regenerating the supply chain for e-bikes. In 2017-2018 the country’s bicycle industry made a successful transition to the production of e-bikes. The strong focus on this high-value product category gave Taiwan the opportunity to move forward in this innovative market. However, the strong fluctuations in supply and demand has seen Taiwan completely lose momentum in the e-bike market.

Taiwan gained a strong position as e-bike supplier for the European and American markets from 2019. This was short-lived since the industry plunged into the inventory crisis. In value Taiwan’s e-bike export in 2024 dropped to a pre-2019 level. In volume, the fluctuation is even bigger as Taiwan is now back to the same level as when it made the transition to e-bike production. Taiwan’s position at the very beginning of the supply chain has made the industry seriously suffer from this inventory crisis. What are the options for the industry to win back its position?

More sustainable business models needed

The transition to more sustainable business models will be in the lead of many discussions at the upcoming Taipei Cycle Show which opens its doors from 26-29 March. The strategy of just producing and selling bicycles and e-bikes one-on-one is not the only way to move forward anymore. ESG remains very relevant to stay competitive, but it should go hand-in-hand with a transition to become an innovative high-tech micro-mobility solution provider.

The influx of new companies in the past 10 years attracted by the positive long-term outlook for the market has also introduced many new business models disrupting the industry. At the same time, city authorities around the world are implementing programs to improve the urban environment. Bicycles often play a key role in these programs and new service providers are eagerly responding to these developments. ICT solutions are key to making these programs easily accessible for people who are not used to cycling. Many features have been developed to make cycling safer and give people a better experience, but there are many more possibilities.

ICT industry as main asset

In business programs Taiwan is often promoting its leading ICT industry as its main asset. Over the years some of the know-how developed in this industry trickled down to e-bikes. Well-known names from the ICT industry such as Acer, Delta Electronics and Darfon ventured into the e-bike market over the past decade. It came nowhere near to give the e-bike industry a competitive edge unfortunately. Remarkably, the closely located ICT industry has never seen the e-bike as a high potential opportunity. Perhaps the huge gap in relevance for the economy explains the lack of interest. The ICT sector’s share amounted to 17% of Taiwan’s GDP and 50% of manufacturing in 2022 (source Altradius). Compared with the ICT industry the bicycle industry is only very small, as the share of GDP amounted to less than 1% in 2023 (source Taiwan.gov).

Cycling has become, besides sports and performance, a mobility solution targeted at urban dwellers with a different perception of ownership and different expectations of the service provided. “The days of investing in another new e-bike or bicycles brand is over. That is too unpredictable, takes too much marketing costs and we all know what inventory might lead too,” a private equity investor said. “Everybody is looking at new mobility solutions.” Will this open the door to new opportunities?