SINGAPORE – The Singapore office of world-leading bicycle parts maker Shimano will act as a forward operating base that will seek out potential new markets in South-east Asia and decide where the group should double down on its existing investments.
Chairman and chief executive Yozo Shimano told Nikkei Asia in an interview on March 6 that Singapore plays a key role in the company’s operations worldwide, not only by advising the Japanese headquarters but also directing all of Shimano’s factories abroad.
Besides Japan and Singapore, the group also has factories in China, the Czech Republic, Indonesia and Malaysia.
He added that the significance of its Singapore operations will grow in tandem with the rising demand for bicycles in Asia and Latin America.
In particular, he was betting on South-east Asia, where most people once viewed sports bikes as luxuries, and expects the region to eventually account for about 20 per cent of the company’s output in the medium to long term.
He was quoted as saying: “In countries like Vietnam, bicycles are first and foremost a means of transportation, but as the economy develops, demand for sports bikes will also increase.”
Over that timeframe, Shimano is likely to invest about 40 billion yen (S$360 million) annually in both facilities and equipment, with about 60 per cent of the outlay earmarked for its overseas operations, including here in Singapore.
Attempts by The Straits Times to reach Shimano for further comment were unsuccessful.
In the meantime, the company will promote cycling across the region through competitions and in collaboration with bicycle makers, as well as local agencies.
Shimano, which develops and manufactures a wide range of bicycle parts such as gears, transmissions, brakes and wheels, has an estimated market share of 85 per cent globally.
In comparison, Singapore accounts for some 70 per cent of the company’s output of mid-range components.
The Singapore factory started operations in 2023 after a 25-billion-yen overhaul to improve efficiency.
Originally, Shimano broke ground in 2018 to build its “factory of the future” at JTC’s almost 64.6 million sq ft Jurong Innovation District.
It was to be completed by 2020. However, construction was hampered by the outbreak of the Covid-19 pandemic and completion was delayed until the end of 2022.
Separately, the company issued a global recall of its Hollowtech cranksets, due to a defect, in September 2023. Cranksets are what move the chains as the cyclist pedals.
Subsequently, a lawsuit was filed by American bike owners in the district court in California. In the suit, the bike owners alleged that Shimano had “knowingly marketed the defective products”.
Shimano said in a statement on Feb 13 that while the plaintiffs are seeking to turn it into a class action, no decision has been made by the court.
It added that the legal action was “still at an early stage of procedural development and the court has not certified a class”.
“We have been working with our subsidiary to respond to this lawsuit and the court’s procedure,” the statement said.
