New bike parts supply chain issues loom as Shimano factory temporarily closes

The Shimano plant in Malaysia will remain closed for the next fifteen weeks due to a government-imposed lockdown following an increase in COVID-19 cases, raising the prospect of further disruption to the industry. bicycle parts supply chain.

The plant had been operating at 60% of its capacity since June 1 due to government measures to contain a new wave of coronavirus cases, but had to shut down completely from Thursday June 10, as restrictions were further tightened.

The government has now extended the measures, which were originally in effect until June 14, until June 28, when they will be reviewed again.

In a statement, Japanese company Shimano Inc said, “The Malaysian government has announced a full lockdown from June 1 to 14 in view of the COVID-19 situation.

“However, it has been extended until June 28. Therefore, we must also extend the closure of our Malaysian factory until June 28.”

The factory in Malaysia, as well as another factory in Singapore, were both closed for a period last year during the first wave of COVID-19, reaching production, and at the time, CEO Yozo Shimano said, “Like all other manufacturing companies, we want to take this opportunity to review our supply chain.

Shimano dominates the global bicycle components market, with the Malaysia plant, in operation since 1990, manufacturing products that include entry-level to mid-range groupsets, wheels and pedals.

High-end products, such as those from its Dura Ace group, are made in Japan and will therefore largely remain unaffected.

With the factory inactive for at least the next two weeks, an ongoing global shortage of bicycle parts will exacerbate which is due to the unprecedented combination of several factors.

These include widespread national lockdowns across the globe in the first few months of the pandemic which not only resulted in the suspension of manufacturing but also had a huge ripple effect on the global shipping industry, which has also seen container prices skyrocket.

At the same time, with governments encouraging people to switch to active travel, demand for bikes has been huge, with many retailers selling popular models, especially priced under £ 1,000.

This coincided with incentive programs in a number of countries such as the UK and France to get older bikes back on the road by offering a discount on repairs, which in turn created peaks in demand for certain parts.

In April, we took a detailed look at the impact of these factors on the UK bicycle market, including the role of components, where lead times have reportedly dropped from 30 days to 11 or 12 months.

> Britain’s Bike Shortage Part 1: What’s Happening, When Will The Supplies Be Back, And How Can You Improve Your Chances Of Taking The Bike You Want?

In this article Peter Lazarus, Cycling Market Leader for Decathlon UK, told us: “Making the frames for the bikes is not a problem. Decathlon certainly has no problem producing its own bicycle frames. These are the components that pose the problem, especially the flagship components: group, wheels, saddles, handlebars …

“It’s a global problem based on unprecedented demand and unstable and unreliable supply chains – raw materials going into factories, finished products from factories to assembly as OEMs. [components fitted on complete bikes], and retail spare parts.

“There is a huge demand for the purchase of the goods and there is also a huge demand from the producers who are potentially ordering too much,” he added.

We also spoke with members of the cycle trade about ways in which people in the UK looking to buy a new bike can try to minimize the impact of the disruption.

> Britain’s bicycle shortage, part 2: tips for buying the bike you want in 2021