Turkish bicycle sector pedaling uphill against major obstacles

A look at the state of İstanbul’s bicycle paths, or lack thereof, tells a different story. The absence of bicycle infrastructure is putting a barrier before the growth of the bicycle as a means of transportation and is blocking a rise in the number of people who ride bicycles for recreation. Gökcan Baydar, the general manager of Delta Bisiklet, one of the largest bicycle parts distributors and retailers in Turkey, speaking to Sunday’s Zaman stated that Turkey is seen in the global cycling scene as a country without much interest in cycling and that “the sole reason for this is a lack of infrastructure. Municipalities just aren’t investing in the roads and paths for use by cyclists.” Regarding the general state of transportation in Turkey, Baydar said it was suffering from a weak transportation infrastructure in general, and this, coupled with one of the highest gasoline prices in the world, can best be solved with actually using bicycles for transportation.

Regarding the figures for sales of bicycles in Turkey, Baydar took another direction and pointed out the sale figures in Holland, a country of 17 million people but selling more than 1.5 million bicycles per year. “In Turkey, with a population of nearly 80 million, this figure is more like 400,000. … We need these bikes, but we don’t have the roads. This needs to be on the agenda of the government as it is something for the benefit of the nation, not just for the benefit of bikers.”

Sales figures from Taiwanese bicycle producer Giant, which bills itself as the world’s largest bicycle manufacturer, emphasize the small scale of the Turkish bike market. In 2008, when the company first started working with one exclusive importer for the Turkish market, only 2,000 Giant bicycles made their way to Turkey. “And that is even a lot more than with our previous distributor,” Rutger Kammeraat, account manager at Giant Europe International, said to Sunday’s Zaman. “We are focusing on the middle and high-end part of the market, with retail prices of over 500 euros per bicycle. Approximately three out of four bikes we sell in Turkey are mountain bikes; the rest are mainly lifestyle bikes. Although the volume in the Turkish market is in the price category below a retail value of 200 euros, it is our strategic choice to stay out of this part of the market,” Kammeraat said.

Saving money on transportation

In Ankara, the nation’s capital, the benefits of bicycles could be seen on a grand scale in a short period of time. According to Baydar, more than TL 5 million is spent in Ankara on transportation per day, not including private vehicles. More than 70 percent of these trips could be completed in 15 to 20 minutes on a bicycle. “This is roughly TL 3.5 million saved per day. … You could build a bicycle factory every day with that much money,” highlighted Baydar. He also added that the roads, parking and monthly bulletins needed to keep bicyclists informed of new developments “would cost a much, much more reasonable amount.”

Purchasing quality bikes that would be enjoyable to ride and last a long time would not strain the budgets of most people living in Turkey, stated Baydar. “A quality bicycle will cost about TL 500 -- about the same as two months of bus rides.”

Despite numerous obstacles barring the Turkish bike market from taking off, Kammeraat still considers Turkey a potential growth market: “Besides growing global attention for cycling and Turkey’s big population, cycling is also a solution for many social issues nowadays, such as traffic, pollution and the fitness trend. The main areas are, of course, the big cities, but also the developing coastal areas are potential growth markets. For the coming years we are expecting an annual sales increase of about 10 percent,” Kammeraat said.

Government support for a public good

Although production of bicycle frames and parts is basically nonexistent in Turkey and possibly impossible given the amount of capital required and the impossible competitive environment accorded the big leaders located in China and Taiwan, the government could still do much to support this sport, recreational activity and transportation method. “This is a sector that works for the gain of society,” Baydar stated. “The government should support this. Instead of allocating free land to the automotive sector, giving land to the bicycle sector could have serious benefits and could lead to a drop in prices. A drop in the 18 percent value-added tax (KDV) could also seriously help the sector.”

Since no factories in Turkey produce bicycle frames and parts, importing these goods is a necessity and a lifeline for the Turkish bicycle sector, which puts these parts together to make a complete bicycle to sell to consumers. Making it difficult to import such goods, therefore, creates a significant barrier to improving such a sector.

Along with a 14 percent import tax on bicycle parts and frames, the Undersecretariat of Foreign Trade (DTM) applies a “red line” status to such items when coming through customs. “Red line” status means thorough inspections by customs officials, which costs $100 per frame to the importer or $200 per complete bicycle. For a small business owner, this is impossible to cover given that low quality bicycles are TL 100 to TL 200.

“This is an incredibly unfair practice. For large bicycle makers like Bianchi Turkey or Ümit Bicycles this is a great opportunity for them to flex their muscles in the sector. They just pay $3,000 to $5,000 every six months for a certificate of inspection, and then they are free of these inspections,” said Baydar. In other words, if a company is importing 200,000 bicycles, these inspection fees are quite easy to cover, but importing some 10,000 bicycles -- coupled with the fact that a company cannot just stop paying these fees one year and start paying them again another -- is impossible with these high costs.

Moreover, bigger firms are also engaging in other uncompetitive practices. According to a sponsorship agreement with the Turkish Bicycle Federation, the Presidential Cycling Tour had only two bicycle parts manufacturers: Shimano, a world renowned producer of bicycle parts, and Bianchi Turkey, a Turkish bicycle firm that gained the rights to produce under the Italian bicycle maker Bianchi’s name. The agreement included a clause that restricted sponsorship by bicycle producers of the race to these firms only, for a sponsorship price that, according to Baydar, was “miniscule.”