On Top of the World:

“It may be hard to imagine, but even such a small part as a derailleur cable can support an entire factory. Moreover, the technology and design of these cables are continually being refined. Taiwan has become the top maker of these in the world, which is very impressive,” says Hope Chou, secretary general of the Taiwan Bicycle Association (TBA), who has been involved in the bike industry for 23 years. The company Chou is talking about is Chia Cherne Industry, located in Chang­hua City. In fact, the world’s number-one producers of bicycle chains, hubs, and tires are all located in Taiwan.

World leader in high-end bicycles

“Taiwan is also the world’s leading producer of high-end bicycles by production value,” notes Chou. The reason the bicycle industry is concentrated in Taichung and Changhua is that Central Taiwan has many highly capable manufacturers of precision machine tools and production machinery. This enables the bike industry to readily find solutions and enhance the sophistication of parts.

You can source virtually every kind of bicycle part in Taiwan. Many multinational brands including component maker SRAM and leading front suspension fork maker Fox have set up production and R&D centers on the island. Brands including Trek, Prologo, and BMC shop for parts in Taiwan or have established bike assembly plants here, exporting their products around the world.

“This is because you can’t find a parts supply chain anywhere in the world as complete as the one that exists in Taiwan,” says Chou. Taiwan not only provides an excellent investment environment, but even more importantly suppliers, attuned to market conditions requiring “high-mix, low-volume” production, are able to rapidly respond to changing demands from buyers by immediately adjusting designs and production. In addition, Taiwanese firms are adamant about maintaining high quality and the island has an outstanding pool of human resources. These factors make Taiwan the optimal support base for international brands.

Hope Chou, secretary general of the Taiwan Bicycle Association, notes that the production of e-bikes (electrically assisted bicycles), which have become popular worldwide, also depends on Taiwan’s supply chain.

The success of the A-Team

The credit for assembling this comprehensive supply chain goes to the “A-Team” program, a cooperative effort between industry and government. Chou, who was the last executive secretary of the A-Team, offers the following analysis: “The success of the A-Team can be said to be due to being in the right place at the right time with the right people.” The “time” aspect was that the A-Team was formally established in 2003, and in 2004 the EU lifted anti-dumping duties on Taiwan’s bicycle industry, giving Taiwanese bike builders the opportunity to greatly boost their exports; the “place” aspect was that the supply chain was concentrated in Taichung and Changhua; and the “people” aspect was that the major bicycle manufacturers Giant and Merida set aside their competitive mindset and agreed to work together to guide 20 parts makers in upgrading their manufacturing capabilities and quality management. With impartial mediation from the Industrial Development Bureau of the Ministry of Economic Affairs (MOEA), the A-Team introduced know-how from the Toyota Production System and other sources to the selected parts makers.

Chou concludes: “As quality was upgraded, Taiwan firms became indispensable, so that the island assumed an unchallenged position as the world leader in high-end bicycle manufacturing.”

The members of the A-Team are today all leading global manufacturers of their respective products. Examples include chain makers KMC, cable makers Chia Cherne, and hub makers JoyTech (owners of the Novatec brand). Even the major automobile tire manufacturers Cheng Shin and Kenda branched out into the industry: At the suggestion of Giant founder King Liu, both established bicycle R&D teams, and they are now among the world leaders in production of bike tires.

The formation and success of the “A-Team” has made it possible to keep R&D of bicycle parts in democratic Taiwan and has put the island in an invincible position in this industry.

Crisis and opportunity for e-bikes

Electrically assisted bicycles, better known as e-bikes, with their energy-saving and carbon-­emission-­reducing credentials, are an emerging new product in the global bicycle market. “According to MOEA data, the production value curves for e-bikes and conventional bikes crossed over in 2021,” says Hope Chou. E-bikes sell for a higher unit price, and in 2021 the value of e-bikes produced in Taiwan surpassed that of conventional bicycles, while the number of units exported also exceeded 1 million for the first time.

At present Europe is the main bastion of e-bike manufacturing, but Europe lacks the necessary component makers and must still rely on factories in Taiwan and elsewhere in Asia where there are comprehensive supply chains. This has enabled exports of bicycle parts from Taiwan to increase year by year, but also poses a new challenge for parts makers: They need to reassess how their products will perform on an electrically powered bike and redesign bicycle frames, chains, and so on to make versions specifically for e-bikes. “The TBA and the MOEA have adopted a public–private-partnership model to help bicycle parts makers overcome obstacles and apply Taiwan’s competitive advantage in electronics and information technology to e-bikes,” says Chou. She concludes earnestly: “This will be tough battle.”

Hidden champions of the bike parts industry

Taiwan has a comprehensive bicycle parts supply chain, including everything from handlebars, front forks, suspension, chains, and bike frames to saddles, tires, gears, and bicycle assembly. It has companies making more than 20 different types of bicycle parts, which constitute a formidable force. On trips to Taichung, Chang­hua, and even Tainan, one can discover a dozen or more hidden champions.

The hub experts: JoyTech

JoyTech (Joy Industrial Company) got its start 52 years ago making steel hubs for single-speed bikes. Today it produces 15 million hubs per year, giving the company a 10% share of the global market.

“The hubs are the heart of a bicycle. They bear weight as part of the wheels, and play an important role in the drive train.” JoyTech sales team leader Glen Lin adds that the “dual ratchet system” (DRS) cassette freehubs being produced under the high-end brand Novatec Premium are well-suited to use on mountain bikes and BMX bikes which are used for off-road activities. DRS has greater strength, longer service life, and greater durability than a conventional pawled ratchet. However, its structure is also more complex, using two interlocking ratchet rings and thus giving better engagement. Compared to traditional freehubs, the new system can enhance the efficiency of pedaling on rugged terrain.

For road bikes, where the emphasis is on speed, the lightest hub weighs less than 80 grams.

Visiting the JoyTech factory in Taichung’s Daya District, we see three two-story-tall cold-forging machines, and assembly lines with robotic arms and automated testing, illustrating the trend toward intelligent manufacturing.

Lin mentions that JoyTech’s product range has expanded into other bicycle parts including carbon fiber wheel rims, front forks, and handlebars. The firm has also crossed over into aftermarket parts for owners of high-end bicycles. In the future they aim to become a “total solutions” components supplier for both conventional bikes and e-bikes.

In line with the move toward ESG sustainability. JoyTech’s hubs are packed in honeycomb paper in order to reduce greenhouse gas emissions.

JoyTech’s Taiwan factory makes high-end bicycle parts.

These hubs are made by production lines which feature intelligent manufacturing.

Built on cables

Chia Cherne Industry Company, located in Chang­hua City, made its name producing gear cables and brake cables. It provides customized cables for a variety of bicycles and ranks first in the global market for its products.

Take the brake cables used by Taiwan’s YouBike bike­share service. To deal with the intense sunshine the bicycles are exposed to, Chia Cherne adjusted the formula of its cables’ plastic sheathing material, upgrading the UV resistance from 100 hours to 400 hours. Also, in response to ESG demands for environmental sustainability, the company is now working on incorporating recycled materials into its products.

“The quality of brake cables is reflected in the feel the rider gets when braking: Can they bring the bike to a halt by gently squeezing the brake levers, with a stable level of braking force?” Johnny Chen, an engineer with Chia Cherne’s control systems division, explains that this kind of quality comes from the stability of the production process and the design of the cable system. In the casing of a brake cable there are a number of metal wires, and the problem is how to arrange and braid them to eliminate deformation during compression. This is especially important for elderly or female riders, to ensure that their hands do not become sore from using the brakes on longer rides.

For its hydraulic disc brakes designed for electric cargo trikes, Chia Cherne’s competitive advantage lies in the design of its hydraulic hose, and in particular in controlling the hose’s expansion coefficient. The thickness of the hose walls has been reduced, which allows the hydraulic fluid to flow more freely, giving faster response times and excellent braking power.

Chia Cherne has expanded its production of precision cables to include fitness cables, yacht motor cables, throttle wires for farm machinery, and avalanche airbag ripcords. From cables to complete braking systems, along with the development of a heatsink and cooling devices division, the company is making optimum use of its expertise. This is the same logic that has enabled Taiwan’s cutting-edge bicycle parts manufacturers to continue to extend their operations virtually without limits.

Hydraulic disc brakes, comprising calipers, brake discs, and hydraulic hoses, embody a high level of bicycle manufacturing craftsmanship.

The brake cables produced by Chia Cherne provide riders with a smooth and gentle braking experience.