TAIPEI (Taiwan News) — Giant Manufacturing Co. and Merida Bikes are expanding overseas manufacturing to cope with the US imposing a 20% tariff on Taiwanese imports, in addition to the existing most-favored-nation rate.

The US is a key market for Giant. The company said it has suspended promotional discounts for products sold there and raised retail prices by 10% starting in May to offset the impact of the tariffs, per CNA.

Taiwan Bicycle Association Chair Wu Ying-chin (吳盈進) said major market channels began stocking products earlier this year in anticipation of US tariff policies. He added that higher retail prices could dampen consumer demand.

Giant said the tariffs have affected nearly all major bicycle-producing countries, pushing up production costs. It plans to distribute manufacturing across multiple countries to localize supply chains and provide more direct support to key markets.

The company has no plans to set up factories in the US, citing the labor-intensive nature of bicycle production, its limited automation potential, and high labor costs in the country.

Merida said the tariffs are driving a restructuring of global supply chains and it will continue to balance production costs with import duties through a flexible global strategy.

Chang Chen-yung (張振墉), deputy general manager of Merida’s marketing division, said the US accounts for about 11% of the company’s revenue, primarily through contract manufacturing for US bicycle brand Specialized. Due to the tariffs, Specialized may negotiate with Merida on how to share the increased costs.

Merida added that Taiwan is not at a disadvantage in tariff rates compared to other major bicycle-producing countries such as China and Vietnam. It said Taiwan remains competitive in electric bike and high-end sports model production, backed by strong brand trust and advanced manufacturing capabilities.