The motorcycle industry in China was born in the 1950's, with the foundation of the Beijing Motorcycle Factory. Today, China is the largest producer in the world, accounting for nearly half of the world's total production.
The first Chinese motorcycle was developed in 1951 to meet the country's military needs during the Korean War.
The country's exports, for the 10-month period between January and October 2005, amounted to $1.4 billion, an impressive 47 percent increase from international shipments in the same period of the previous year. The growth in export volume closely mirrors that value, slightly exceeding 46 percent in the 10 months to October 2005.
The massive entry of private enterprises, which began in the early 1990's, changed the industrial organization dramatically. They mushroomed and formeda motorcycle cluster in several cities. The flood of their low-quality products caused a drastic decline in the market price of motorcycles.
[...] The emergence and development of the Chinese motorcycle industry has characterized the global motorcycles industry into two business architectures, close-integral model which is considered as classical Japanese architecture and open-modular model which is newly established as a result from Chinese motorcycle industry. On the global scale, motorcycle industry is a mid-tech and rather technologically mature industry. Automotive sector of several Asian latecomer economies started with assembling motorcycles and producing their parts by using imported technologies. Although the Japanese companies countered the Chinese motorcycles by launching new models and have rapidly recovered their market share since 2002, local companies continue to keep certain market shares due to their price advantage over Japanese products. [...]
[...] Chinese motorcycle industry started with standardization and penetrates the domestic industry. Some reasons for Chinese motorcycle exporting are: - the stagnation of domestic demand - a high production capacity - overstock - and the efforts to sell out copied models. The Vietnamese and Indonesians are the biggest buyers of Chinese motorcycles and South America is an increasingly important market for Chinese motorcycle exports. Let's take a little bit hold example but it really show the reality: Honda in Vietnam. Although Honda's production volume in Vietnam increased slightly in the period 1999-2000, it was outweighed by the growth rate of Chinese motorcycles, from less than one thousand units in 1999 to 1.5 million units in 2001. [...]
[...] However, these rules have not been kept fully by Chinese industry (and also countries in East Asia) even after their affiliation to the WTO. These pictures show the first imitations of the pre-war Bmw what were already copies of the Soviet and with the same technicals features. The important fact is that these bikes are still produced in China. We still can find a variety of imitations. The main reason why imitations are so popular in this region is because consumers do not have enough money to buy the real Japanese motorcycles. [...]
[...] While they have acquired a certain level of manufacturing capability and increased procurement of parts from local Taiwanese and Chinese companies in Vietnam, they have not managed to overcome their dependence on China for production and sourcing of key parts. In conclusion we can say that the Chinese Motorcycle industry is quite well developed but the problem is the lack of innovation to face the production of copies. Even if their market is huge and their prices are low, with a such growing industry, Chinese producers are going to encounter big troubles with the authorities. They will have to adapt their own products to the rules of the [...]
[...] After visiting 4 motorcycle shops who sold Chinese motorcycles in Hanoi, it was recognized that more than 90% of the models were copies of Honda models. One shop keeper explains that his business by the consumer's taste for models which are copies of Honda. It is for this profitable reason that shops import these products and sell them. The important point we need to keep in mind is that consumers know that those products are imitations. They also know that the quality of most of these motorcycles is lower than real Japanese products. [...]
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