The opening case explores the globalization of the bike industry. In the 1970s, the United States produced some 15 million bikes every year. Bike 2018 however, about 95 percent of the bikes sold in the United States were assembled in China. China also produced much of the industry`s bike components, leaving U.S. bike companies to focus on design and marketing. In 2013, Detroit Bikes set out to change this trend and bring bike production back to the United States. This strategy has proved to be challenging, and even more difficult following Donald Trump`s trade war with China which targeted bike parts among other products for hefty tariffs. Detroit Bikes remains optimistic that its dream of American-made bikes will succeed, but for now, is pursuing a patchwork of strategic initiatives including importing parts from Vietnam and Taiwan to Canada, where the bikes would be assembled prior to shipping them to the United States.
1. Discuss globalization and how the bike industry epitomizes the phenomenon. How has globalization, and specifically the globalization of markets and production, changed the nature of the U.S. industry?
2. How has U.S. trade policy impacted Detroit Bikes? What does it mean for consumers? What does it mean for the workforce at Detroit Bikes?