The situation in the Indian bicycle industry for the last few months has been like the proverbial ‘water, water everywhere but not a drop to drink’.
The Covid pandemic resulted in an unprecedented global demand for bicycles and India was not spared from this fortunate deluge. Suddenly, everyone is riding in our cities, pop up bike lanes have, well, “popped up”, social media has created local cycling ambassadors and cycling is emerging as an urban counter-culture.
Let us look at, not about demand for bicycles but about their supply, or rather the lack of it, and how perhaps to some extent exemplifies our woes as a manufacturing nation. Unprecedented demand has led to acute supply-side challenges. Retailers have run out of stock, imports are constrained and consumers have been waiting to get a bicycle of their choice for months.
Global brands are coping with sudden demand led production ramp-up and their supply lines are understandably skewed in favour of their home and traditional markets.
Production itself has not been smooth as Covid-19 has complicated the manufacturing ecosystem. Add to that a unique situation for us in India where port restrictions for all things Chinese have slowed down release of containers that have landed.
But why should we as a country be faced with this situation? Surely, we should have been able to satisfy our domestic demand locally. We manufacture close to 18 million units annually. One of the largest numbers anywhere. But that’s where the Indian bicycle manufacturing story begins and ends and perhaps even reflects the muddled state of our manufacturing priorities.
Majority of bicycles manufactured in India till recently, close to 80 per cent, are the single speed black roadsters or their touched-up variations.
Choice of masses
The steel framed “Milk-man” type with spring loaded saddle and a century old handlebar design that knocks at your knee. Historically, in rural India and even in early working-class cities, black roadsters were the mobility choice of masses. Pune was even called a city of cycles! The Roadsters iconography was even adopted by a political party as its election symbol.
Society has moved on, needs have morphed, aspirations have evolved, and Indian masses have switched their mobility preference to other modes. The black roadster though remained mired in slush puddles of village roads of the 1960s and 1970s and so did our bicycle industry.
Globally, the bicycle sped along to create a multi-billion-dollar industry straddling sport, recreation and leisure. While brands from Europe and the US are market leaders, China and Taiwan have emerged as manufacturing hubs. The latter is in fact acknowledged as the bike design and manufacturing capital of the world.
Steel frames have transitioned to advanced alloys and carbon composites, advanced bionics go into design and components use cutting-edge precision engineering. Bicycle sporting events like Le Tour and Giro match viewership of golf, tennis and cricket.
There are bikes of every kind to suit every kind of need. Road bikes, hybrids, MTBs and folding bikes for sport, leisure or commute and everyone is riding.
But there are no takers for the black roadster or a low-quality steel frame.
And that’s where the root of the problem lies for India. A lopsided demand-supply equation.
But why did we remain stuck in the past? After all, leading Indian cycling companies are not small and short of resources. Hero and TI Cycles belong to groups with market cap exceeding $5 billion. Even the Tatas manufacture bikes. There is even a thriving component cluster in Ludhiana. All have pivoted but not to the extent one would have expected. Is it because of the state’s socialist priorities and an inadequate inspiration to excel amongst manufacturers?
Cycles were a favourite giveaway in most State governments’ social schemes. Free bicycles for the school-going child, especially girl child, was and still remains a popular scheme. These schemes accounted for a large share of production of cycling companies that were awarded tendered contracts. The schemes were even conveniently structured in a manner that orders were assured year after year and no incumbent government would dare to reverse it for the fear of populist backlash. Cycle companies were thus assured of a continuous fodder for their production lines.
Business was attractive in more ways than one. Not only did the state assure demand, these companies even got prime industrial land, soft finance from public sector banks, etc. But when you get accustomed to public contracts with no free market pressure, innovation and quality take a back seat as producing lowest quality for cheapest price becomes an annual routine. That’s precisely the malady that has gripped the industry.
An inspired vision amongst promoters could have launched the industry into an innovation orbit, but most seem to prefer socio-populist comfort. While they prospered, acquired real estate, expanded and diversified their business, none thought of putting a winning Indian product or a team on the world racing circuit that would set a manufacturing benchmark for the country. Or even coming up with some innovative component.
After all, a bicycle is not a particle accelerator or a rocket launcher! Even an honest desire to give a product of highest quality to that girl child labouring on a steel frame could have led to product innovation. Clearly, inspiration was missing.
This cocktail of socio-populist comfort and vision myopia did not put pressure even on the upstream and allied ecosystem. We have marquee steel corporations, but one still cannot get a special steel alloy tubing at competitive production scale. Ditto for high quality components. It may surprise many, but we still don’t make bicycle tires of high quality.
The writer is CEO Helicon Consulting