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Major US Bicycle Maker Outsourcing to Asia

Bedford, a small town on the Juniata River in southern Pennsylvania's Allegheny Mountains, has been the manufacturing center for the Cannondale Bicycle Company, the second largest remaining producer of bicycles made in the USA.

Outwardly things are normal in Bedford. Winter is over, and merchants await the tourist season.

Sportsmen have traded in their deer rifles for fishing gear.

But there is also industry in Bedford. Over 200 Cannondale bicycles, the pride of Bedford, roll off the line every day at the local factory.

Each bike, with its trademark aluminum tubes, is marked "handmade in the USA." The bikes often retail for more than $1,000 apiece.

Cannondale's Canadian parent, Dorel, has announced it is outsourcing production to Taiwan, and the news has hit Bedford hard.

Mike Miller is a painter at the factory. He suspected his job might be shipped to China.

"A bunch of us thought this was coming, the way people were acting. Something fishy was going on," he said.

Two thirds of the 300 workers here are losing their jobs, adding to a local unemployment rate already at 13 percent.

Miller will be among the first to go. He says his severance package will be one week of additional pay.

Dorel made record profits in 2008. It says the move to Asia will save $4 million a year.

Jeremiah Johnson left Cannondale last month. He complains about corporate greed.

"If you look at the way Dorel has run things in the past, you see that what they do is they buy something, they make it cheaper, and they make it elsewhere," he said.

Dorel denies that it purchased Cannondale last year with the intention of outsourcing production, a process it says was already underway. Some non-manufacturing operations in Bedford will continue.

Bedford residents feel betrayed. Even on a Friday night, as people stock up on beer for the weekend, they share their views about Cannondale.

RESIDENT: "Before it's all said and done, they're going to move them all out."

Former employee, Roxanne, used to attach decals to Cannondale frames.

"No, we should keep our business in America. We stand together," she said.

At the corner bike shop, customers wonder how many people buy Cannondales because they're handmade in the USA.

CANNONDALE CUSTOMER: "I think it's important to a lot of people, especially in this part of the country, knowing that it comes from Bedford, Pennsylvania."

Production will be phased out by the end of the year.

CANNONDALE EMPLOYEE: "Unemployment rate is going to skyrocket. People are going to have a hard time getting even fast-food jobs."

Bedford, like dozens of other American towns, will face the challenge of how to create decent jobs in a post-industrial economy.