Hero Cycles requests government support amid China import restrictions

Hero Cycles has demanded support from the government for boosting local component manufacturing amid import restrictions from China as a shortage of raw material and components are hindering adequate production of high-end bikes.

By:January 2, 2021 11:40 AM

The supply chain disruption post-pandemic, imports restrictions from China followed by freight train obstruction in Punjab have created a major supply shortage for bicycle industry in India. Shortage of raw material and components are hindering adequate production of high-end bikes that are in demand in the post-pandemic period, and so Hero Cycles has demanded urgent government support for boosting local component manufacturing and seamless supply.

“While, on one hand, we are witnessing a surging demand for bicycles and e-bikes; on the other hand, shortage of raw material and components is turning out to be a major hurdle for all bicycle manufacturers in India. This has resulted in increased waiting times for customers, particularly for high-end bicycles,” said Pankaj M Munjal, chairman & managing director, HMC, a Hero Motors Company. “In this situation, we urge the government to provide active support to the bicycle sector to be able to overcome these challenges. Firstly, we need all freight train movement to Punjab to resume completely, allowing us access to raw materials. Secondly, the bicycle sector needs government support in localising component manufacturing and reducing dependence on foreign supplies, particularly from China.”

Estimates suggest India imports bicycle parts worth over $70 million annually. In recent years, India’s bicycle industry has come to rely heavily on China for imports of components and high-end parts. The Covid-19 crisis has underlined the importance of sustainability in business and effective backend integration. Diversifying supply lines and establishing a strong localised component manufacturing sector is are top priorities for the bicycle industry.

“The government must support this endeavour initially through fiscal and non-fiscal measures until the sector develops robust manufacturing capacity of its own. A favourable duty structure and support for R&D and innovation are key,” added Munjal.

Among other things, Hero Cycles is working towards localising e-bike manufacturing including components in the country over the next few years.

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