“We, Basque people, have the most passionate cycling fans, and this DNA-wired attitude informs our business model too”
We’ve talked to Orbea Manager Jon Fernández and Production Manager Miguel Ángel Estandia about Orbea’s new projects and history, and about the evolution of the cycling world in the past few years. In this interview, they share their experiences and opinions about a sport that never stopped growing in the past few years.
You’re two of the people with the longest experience and the highest responsibilities in the organization. You must have seen the cycling industry go through different times. How did you experience the evolution of the organization on the industrial side?
J. F.: The big change took place in the past 25 years. Our production system has evolved from highly internal, intensive production with low value added to the making of low-end assemblies to the system we use at Orbea today. Now we make high-value-added products, having evolved from robot-welded steel frames to hand-welded aluminum frames, i.e. high-performance welding. Then we moved to the modeling and prototyping of carbon frames and custom assemblies.
M. A. E.: At first, we just modernized the Orbea bikes as a means of survival, making lighter frames and focusing on road cycling. In the 1990s, with the boom of mountain biking, we sold everything you could think of. Then, in 1995, there was a crisis, worse than the recent one. We recovered by betting on specialization: bespoke bikes for pros, made with the best possible materials. We became one of the largest manufacturers in Europe, making 40 to 50 frames a day. After that there came the Orca project and carbon frames. We revamped the brand again, to good results.
What’s Orbea’s industrial situation right now?
J. F.: We have two manufacturing facilities. The main plant is in Mallabia, focusing on mid-to-high-range products for the European and American markets. And the other facility is in Portugal, where we produce low-to-mid-range products under an intensive production system. About 175 or 180 people work in our plant in Mallabia, while an additional 100 perform tasks in the other facilities and offices.
M. A. E.: The plant in Mallabia has a surface area of about 15,000m2. Here we make 170 or 180 high-end bikes. In Portugal, the plant is divided. At first, in 2000, we resorted to outsourcing. With time, we chose to raise our bet and now we have almost 8000m2, which account for 66% to 70% of production. After the closedown of the plant in China, we rented larger facilities to house the production that used to come from Asia in either Portugal or Mallabia.
J. F.: Orbea is a brand with a long history. We’ve built an identity associated with determination in goal achievement, reinventing ourselves once and again. The company is 175 years old. In almost two centuries, we’ve reinvented ourselves several times, and this is proof of our willingness to remain in business. We, Basque people, have the most passionate cycling fans. Cycling is part of our essence; it’s wired into our DNA. Our DNA informs our business model too: we’re meticulous, rigorous and strict when we develop our products.
M. A. E.: We rely on a flexible model. For instance, we keep making the bikes in our range until the day when the range is discontinued. That is, when we introduce a new range, we keep delivering the old stock for at least 15 days, so that our models reach all users.
As seen from outside, bike assembly may seem to have no added value. You may think it’s a job that could be done by a machine. But users know that workmanship is essential when you make bikes. In the age of automation and robots, what’s the added value of workmen?
J. F.: We try to appear as a brand that is close to users, a brand that can make the bike of your dreams. If you can imagine it, we can make it. And it’s no easy task, especially when you have bike-making machines. Hand-made goods, hand painting… They’re just priceless.
M. A. E.: We use automated installations too, but only for full paint coating. Under atomized manufacturing systems like ours, using machines is more costly than craft production. And then there are the other bike components, those that can’t be machine-made if we want to deliver top-quality, high-end products, with so much value added.
“(…) a brand that is close to users, a brand that can make the bike of your dreams. If you can imagine it, we can make it. And it’s no easy task, especially when you have bike-making machines”
Zeus is one of the most special areas at the plant. Why do you have a special area for high-end bikes?
M. A. E.: Zeus used to be the place where we made road bikes a few years ago. High- and low-end bicycles carry different materials and, with them, different manufacturing processes. As we became more specialized, we added new production lines and came up with new ideas to offer unique bikes that meet the needs of individual customers.
“We wanted to return to our European origins. Under this model, it’s easier to customize our products and thus offer something different from the other brand”
What is there behind the sensational headline, ‘Orbea closes down factory in China’?
J. F.: It was basically for business reasons. Disinvestment isn’t necessarily the result of failure. We just stopped manufacturing in China, but our logistics and business activities in Asia are still on – even reloaded, you could say. We’ve chosen the European manufacturing system, which is deeply rooted in our environment and makes us feel really proud. Upholding this legend built over the decades, from the 1930s on, there are just a few of us now. We’re proud of being the heirs of a legendary industrial legacy.
M. A. E.: We wanted to return to our European origins. Under this model, it’s easier to customize our products and thus offer something different from the other brands.