, Giant – while noting that nondisclosure agreements prevented it from discussing the details of the letter sent to suppliers – said that as the global bike industry returns to normal following the lockdown-related boom of the past two years, demand for low-priced models has weakened, in turn causing an increase in inventory levels and leading to considerable supply chain issues.
“Considering all the headwinds in the current market environment, Giant Group has decided to manage this challenging situation with our supply chain partners by mitigating risks and conducting a proactive inventory control, with the goal to return supply chain conditions back to normal over the next few months.”that “this is the first time we requested our supply chain partners to assist us by extending their invoicing periods so that we can endure this off-season together.
Despite the payment postponement, Giant maintains that the company’s operations and working capital remain normal, and have pointed to the sale of convertible bonds in June and the completion of a rights issue in late November – both of which raised a total of NT$6.75 billion – as evidence of its continued strong financial position.
When news of the delayed payments was leaked, Giant’s shares listed on the Taiwan Stock Exchange plunged by 8.04 percent .
Problem is the cost of some bikes now cost the same as a second hand car. Also the bike market went through the roof during the covid years.