By AUSTIN RAMZY
Published: August 30, 2013
TAICHUNG, TAIWAN — THE bicycle maker Giant Manufacturing Company was established amid green rice paddies and earth-god temples, a short ride from the roar of the South China Sea. But for years its founder, King Liu, was never big on pedaling around to enjoy the scenery. The main reason he took one of his new products for a spin was to make sure everything worked.
After decades of struggles, it has. Giant is the world’s largest bike manufacturer by revenue. Its factories in Taiwan, China and the Netherlands churned out 6.3 million bicycles last year, generating revenue of $1.8 billion. The company sells bikes under its own name and makes them for major brands like Trek, Scott and Colnago.
At 79, Mr. Liu still puts in 10-hour days as Giant’s chairman. But after four decades of building bikes by the millions, he’s finally started to enjoy them. Trim and tan from daily rides, with close-cropped gray hair and a heart rate monitor strapped to his wrist, he has become the public face of a cycling boom on Taiwan.
“I have a mission to make Taiwan a capital of cycling,” he said.
Since 2007, bicycle sales on Taiwan have surged, bike lanes and paths have been expanded, and the island’s two largest cities, Taipei and Kaohsiung, have launched bike-share programs. At every step Mr. Liu has unflaggingly promoted the cause.
His evolution from a small-town tinkerer to an industry titan reflects greater shifts of Taiwan and its economy. Once a workshop to the world, anonymously churning out bikes, cellphones and computers for big-name foreign companies, Taiwan now has firms like Giant, HTC and Acer that have become global brands in their own right. With those successes come new questions about whether those businesses can continue to lead and innovate.
For Mr. Liu, the answer is not just selling more Giant products (though his cycling advocacy campaign certainly helps with that), but focusing on how bicycles can reduce pollution, make people healthier and help cities function better. “It’s been amazingly successful P.R. for his company, but he’s not only doing it for that,” said Ho-chen Tan, former chairman of Chunghwa Telecom, Taiwan’s largest phone company, and a regular cyclist. “He’s showing that even people his age can do this. His encouragement and commitment is a driving force for people to follow.”
Mr. Liu’s transformation, and that of many of his cycling compatriots, was motivated somewhat unexpectedly by a 2007 film, “Island Etude,” about a young man who bicycles around Taiwan. “With some things, if you don’t do them now, you might never do them in your life,” was its most often repeated line.
“I saw the film and thought, that line, it’s criticizing me, isn’t it?” Mr. Liu said. “I was 73, and I thought if I don’t ride now, I’ll never be able to do it.” So he took up the film’s challenge, planning a circumnavigation of Taiwan.
He trained for six months, but admits that was not enough. Images of the 2007 ride show his round belly pressing against his jersey, his face locked in a scowl. “Oh, that trip was really miserable,” he said. “I had back pain, sleep apnea, high blood pressure and so on. Old people’s problems.” At one point he was knocked down by a car and scraped. But he persevered, finishing 575 miles in 15 days.
In business he has shown the same determination. After graduating from a technical high school, he cast about at several professions — transportation, chemicals, food imports, hardware — before deciding to build a bike factory with several friends in 1972. He was 38 and still reeling from the loss of his previous venture, a coastal eel farm that was destroyed in a typhoon.
“For the first four years we had no orders,” he said. “The image of products from Taiwan was very poor.”
HAVING learned to speak Japanese as a child while Taiwan was under Japanese occupation, he traveled to Japan and studied what was then the premier bike manufacturing economy. A major breakthrough came in 1977 when Giant’s chief executive, Tony Lo, negotiated a deal with Schwinn to begin manufacturing bikes for the iconic American brand.
Schwinn became both Giant’s strength and weakness. Bike sales leapt in the United States during the oil crisis, and after workers at the Schwinn plant in Chicago went on strike in 1980, Giant became a key supplier, making more than two-thirds of Schwinn’s bikes by the mid-1980s.
Then Schwinn decided to find a new source, and in 1987 signed a contract with China Bicycle Company to make bikes in Shenzhen, near Hong Kong. “We were terrified,” Mr. Liu said. Giant relied on Schwinn for 75 percent of its orders, and its survival was at risk.
Giant began focusing on building its own brand, setting up operations in Europe and the United States. Gradually sales of Giant-brand bicycles grew. At the same time Schwinn’s fortunes declined, and it filed for bankruptcy in 1992. The American company was never able to get cheaper production from its China Bicycle investment, said Jay Townley, an industry consultant who was an executive at Schwinn and later Giant’s American arm.
Mr. Townley, who has known Mr. Liu since the early 1980s, said that in that era, most bike executives weren’t interested in fitness. “Everybody smoked, everybody drank,” he said. “There were some cyclists, but rarely like what you see today.” Mr. Liu, he said, was better known as a ballroom dancer.
Now Mr. Liu focuses on his bike. He racks up about 25 miles a day, riding in the early morning around Giant’s headquarters in the central city of Taichung. He feels depressed when he can’t train because of rain or work trips. “I can’t stop riding,” he said.
IN 2009, he followed up his trip around Taiwan with a 1,000-mile ride to Shanghai from Beijing. It was a logical next step. Giant’s manufacturing is now largely based in China, where it has six factories. China dominates global bicycle production, but Taiwanese companies either own or operate the factories that produce about 80 percent of China’s bicycle exports, industry analysts say.
While China’s legions of bike commuters have declined in recent decades, the number of recreational cyclists is growing, making it a crucial market. Giant is one of the most popular brands in China, thanks to a strategy focusing on higher-quality, more expensive bikes.
But while recreational cycling is rising in China, it has taken off in Taiwan. Bike sales hovered around 600,000 annually for most of the 2000s before surging to 1.3 million in 2008. Taiwanese buy about 900,000 bikes a year.
Mr. Liu believes that Taipei, with its car- and motorbike-clogged streets, is the biggest obstacle to making Taiwan a “cycling island.” The city’s government is trying to make it more inviting for cyclists, widening sidewalks for bikes and expanding its bike-share program. Monthly use of YouBikes, Giant three-speed cruisers that rent for less than a dollar an hour, climbed nearly sixfold from September to May, to more than 790,000 trips.
Mr. Liu knows he can draw people to cycling. For his 80th birthday next year, he plans to ride around Taiwan, repeating his 2007 route. “I want to show I’m even stronger than when I started,” he said. “If my stamina is better than when I was 73, that should be a big news story.”