The last time
, the clock was ticking for the UK and the EU to figure out how to avoid a no-deal Brexit. Now, an agreed trade deal, signed into law less than 24 hours before it took effect, has left companies scrambling to adapt. The deal prevents the imposition of tariffs on some British and European goods and helps mitigate the abrupt fall out of the EU that seemed imminent for Britain, but some companies are still splitting hairs to figure out whether their exports benefit from any protection from tariffs.
The deal eliminates tariffs on European and British goods that would have applied if the EU and the UK defaulted to using the World Trade Organization rules in a No Deal Brexit, but non-European and non-British products are not protected, so some companies have found themselves in the awkward position of figuring out what it means to make a British or a European product.
Cotic, a UK bike company, has suspended sales to EU customers until they sort things out. Cotic designs, engineers, and tests their bikes in the UK. Much of their building and machining happens in the UK, however, linkages and some rear triangles are built in Taiwan. Are those bikes British? It’s complicated.
Under the new trade deal, products have to contain a certain percentage of materials or the more esoteric “value” from the UK or the EU to be considered British or European, respectively. Cotic, in a statement on its website, wrote that the company is trying to figure out just what that means, and in the meantime, has halted sales of those mixed-origin bikes to customers in the EU. If Cotic designs bikes in Britain, manufactures parts of the frames in Taiwan, and assembles them in Britain, the exact origin of those bikes is tough to define.
|The upshot of all this is that for this week at least and maybe longer, and until we know exactly what the duty situation is, we are not shipping anything to customers in the EU. We want to give ourselves time to understand and apply the new rules correctly, and then be able to explain them to customers. There will be increases in shipping prices as well due to the couriers having to clear products through customs now, so once we have all the costs understood, we will be in touch to agree any cost increases with you.—Cotic Bikes|
Nukeproof, designed and based in Belfast, Northern Ireland, has declared that its bikes do not qualify as European products. The company wrote in a Facebook post that it had to increase the suggested retail prices for their bikes, thanks to tariffs imposed on non-European goods.
The post read:
A large proportion of Nukeproof bikes are assembled in European factories and our hope was that a trade deal would allow these bikes to pass between the EU and our UK warehouse tariff free.
Unfortunately, the new UK-European trade deal only allows tariff free trade on products that have either an EU or UK origin. To achieve an EU origin at least 55% of the value of the complete product must be manufactured in either the UK or the EU.
In the case of Nukeproof, because most of the bike’s value, e.g. frame and components, are manufactured in Asia, the complete bike is not classified as a European product (even if the bike is assembled in Europe). Our bikes, therefore, attract additional import duties between Europe and our UK warehouse. Combining this with price increases with rising raw materials, labour and current exchange rates we have already seen, it leaves us with little option but to increase our SRP’s.
Whilst we have always tried to fend off unnecessary/ unwanted in-season pricing restructures in the past, these are unavoidable costs in unprecedented times, and we are forced to reflect the update with immediate effect.
We understand these are difficult times for many of our riders and we truly appreciate your support and understanding.
The Nukeproof Team
As previously reported, YT and Canyon face similar problems, with bikes designed and assembled in Germany but manufactured in Asia. YT has announced likely price increases, while Canyon has temporarily paused shipments to the UK. Rose Bikes, also German,
as of Dec. 21 stating that the company was unable to fulfill orders from the UK, but the pop-up has since disappeared. Given
, citing laws that dictate on which side each brake lever should be installed, the company seems unlikely to resume UK sales.
Not even British companies selling goods within Britain itself are immune. Brooks England has made their saddles domestically at their Smethwick factory since 1882, but the company has been owned by Italian manufacturer Selle Royal since 2002, and they ship all their saddles to Italy for distribution – even the saddles that will end up right back in the UK.
In a notice published on its website, the company wrote, “At Brooks England, we continue to produce each leather saddle in our West Midlands factory in more or less the same manner as we have for over 150 years. However, upon their completion, since some time these saddles are shipped first to our logistics centre and from there to Cyclists around the world. Due to this, the ongoing changes in the Brexit situation have made it necessary to temporarily suspend all new orders from brooksengland.com to the UK at this time.” However, Brooks’ UK distributor Extra UK clarified that this only applies to customers buying directly from Brooks’ website and that it will continue to deliver product to Brooks dealers.
Campagnolo, bike-discount.de, and other companies have also paused distribution to the UK while the situation remains in flux.