ABSTRACT
At the beginning of Taiwan’s industrialization, many industries started as original equipment manufacturers (OEM). During the wave of globalization, however, these industries entered an era of meager profits due to oversupply. This chapter reviews the history of Taiwan’s bicycle industry, the production crisis and the development of cross-border economic linkages. It argues that the evolution of the Taiwanese bicycle industry was driven by two factors: firstly, China, whose lower production costs and huge market provides the base for many Taiwanese enterprises. The bicycle industry was one of the first post-World War II manufacturing industries launched in Taiwan. Cross-strait economic links have fundamentally reshaped the relationships between Taiwan and China. Taiwan’s bicycle producers are mostly concentrated in the central region of Taiwan. Beginning in the late 1990s, Chinese bicycle manufacturers have been competing fiercely with the Taiwanese firms in the global OEM market and undercutting their prices.
