Far east prices increases confirmed

Far east manufacturing costs, especially those from factories in China, will rise through 2008 and potentially continue to rise far into 2009, according to Bike Europe.
It is reported that labour cost is set to increase 30 per cent year on year, while component manufacturing costs have risen, on average, by six to seven per cent.

An increase in crude oil prices has inevitably caused a knock on effect in both component production and transportation costs. Steel and plastic costs have also seen a small increase.

The Chinese government recently added to the woes of foreign companies operating in China, by introducing a tax on all money transfers out of China to the tune of ten Per cent.

See the February issue of BikeBiz for a smattering of industry opinions on just how, if at all, the costs will filter through to retail.