How Giant became the biggest bike maker in the world – and how it’s using that status to reform cycling

Giant never intended to be the world’s biggest bike brand. Cyclist discovers how it grew to be the colossus it is today

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Giant, it would be easy to assume that the Taiwanese bike brand always planned to be a global behemoth from the day it was founded. But actually it started life in original equipment manufacturing (OEM), making parts for other companies.

The company began in 1972 but it wasn’t until 1977 that the Giant Manufacturing Company’s chief executive, Tony Lo, secured the golden ticket of contracts that was to be the launch pad for future growth. The contract was to produce bikes for Schwinn, a US bike brand that dominated its market at the time with its 10-speed steel machines.

The Schwinn deal followed five fairly barren years since King Liu and a group of his associates founded Giant, but it wasn’t blind luck. Having learnt Japanese while Taiwan was under Japanese rule, Liu spent time in Japan to study what was then the premier bike-building economy.

The working practices he observed and subsequently replicated at Giant were key in securing the Schwinn contract, but in many ways it was when that partnership came to an end in 1987 that the Giant brand really took off.

When Schwinn chose to switch supplier in search of cheaper production costs, its orders accounted for 75% of Giant’s business. That prompted Giant to switch its focus to producing bikes under its own name. Fortunately it had been nurturing this side of the business since 1981, thanks in part to the resources the Schwinn relationship had allowed Giant to develop.

‘It was definitely a make or break moment for us because until then Giant as a brand in its own right had been comparatively small scale,’ says global marketing manager Ken

Li. ‘Going global in 1986 was a huge risk but one that paid off.’

Interestingly it was and continues to be Giant’s expertise in OEM that has played a role in the success of its own products.

‘I think it definitely adds a trust and respect factor to our products,’ says Erik Klemm, Giant’s performance design manager. ‘When people know that other brands come to us for production it tells them our manufacturing is top notch.’

‘Being an OEM pushes us to maintain our competitive edge in manufacturing,’ Li adds. ‘But being a successful consumer brand takes effort in R&D, marketing and sales, more so than in manufacturing. Currently our OEM business accounts for only 30% of sales.’

Considering that Giant counts Trek, Scott and Colnago as clients – but that combined