Dec. 24, 2012 at 10:20 AM ET
HONG KONG - Rich Chinese are buying bicycles that cost more than the average citizen makes in three years, motivated by nostalgia for the days when two wheels were the primary means of transport.
China is now the world's biggest auto market, but high-end bike sales are expected to grow by 10 percent a year as they become a status symbol for wealthy executives.
Yu Yiqun, the creative director at an advertising company in the Chinese capital, cycles to work on his favorite bike - a 100,000 yuan ($16,000) hand-made Alex Moulton.
"It might be the only one in Beijing. It's like the Rolls-Royce of bicycles. Very classical, purely hand-made," said the 40-year-old Yu, who has about 35 high-end bikes.
"I remember my father used to ride me to the city in the winter - about 40 km and minus 30 degrees centigrade. Back then, it was a means of transport that fulfilled your dream of travelling afar, which was relatively cheap but required brawn."
Yu symbolizes a new bike culture in China, where wealthy, health-conscious executives are upgrading their lifestyle, in some cases abandoning flashy cars and taking to the road on high-end bicycles that can cost more than a car.
"Demand for mainstream luxury items such as premium cars, watches has come to a point of saturation. High-income groups now turn to high-end bikes to show off the uniqueness in taste and healthy lifestyle," said Zhou Jiannong, general manager of Rbike Networks Ltd in China.
Analysts estimate about 10 percent annual growth in the Chinese bicycle market over the next few years, with the high-end segment forecast to grow by as much as 15 percent a year.
Companies are also getting in on the act, with a Hong Kong-based supplier taking an order for 1,000 pricey bikes from a Chinese financial firm as a year-end bonus for employees.
"People are sick of conventional gifts such as wines and tobacco. For mainlanders, a bike is a great gift that shows your unique lifestyle," said Adam Wong, managing director at Hong Kong's Komda Bicycles.
Wong declined to name the bank that had ordered the bikes, but he said they had an average price tag of 3,000 yuan ($480).
Fashion label Shanghai Tang, eager for a slice of this growing pie, teamed up with Dutch bike maker Colossi Cycling to make bicycles aimed specifically at China, where bike demand is estimated at about 28 million units a year
"The high-end sector is going to be the major source of growth in the Chinese market. In China, bikes are more than just a means of transportation. It has become a fashion," said Terry Liu, an analyst at Fubon Research in Taiwan.
It can cost up to HK$300,000 ($38,700) for an imported limited edition of expensive brands such as Italy's Colnago or France's Look, nearly 100 times the price of a Flying Pigeon, China's official bike since it was born in 1950.
But the cost as no object for many high-income Chinese looking for the best two-wheeled vehicle.
"For businessmen, they are not looking at the price. They are looking at the quality. They assemble their bike with import components in accordance to their taste and needs," said Zhang Lei, a director of a Zhuhai paper products supplier, who plans to spend 10,000 yuan to upgrade his current bike.
Yu, the advertising executive in Beijing, has orders in for four more hand-made bikes, expanding his vast collection which includes brands such as Trek, Bianchi and Colnago.
He and his wife have two cars but he says he doesn't drive.
"I always bring my bike when I go on a business trip," Yu said. "When I go to Harbin, I bring a small, folding bicycle since it's easier for me to get around the city. When I go to Dalian, I bring a bigger bike since it's a mountainous city."
Copyright 2013 Thomson Reuters.