What's going to happen to Erik Buell?

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Erik_Buell.jpgWe just got off the phone with Harley spokesperson Paul James. According to him, Erik Buell is in ongoing discussions with Harley about taking on an advisory roll at The Motor Company, in which capacity he’ll contribute to future product design. The rest of Buell’s 180 employees won’t be so lucky, they’ll be out on the street as of December 18, the day the Buell plant shuts down. This news will come as a shock to them, like the rest of us, they only found out about Harley killing Buell this morning.
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Paul didn’t have Buell sales figures to hand and we don’t believe
they’re published by Harley, but he suggested that this year’s sales
were down compared to last’s about the same percentage as Harley’s
better-than-industry-average 21.3 percent figure. Indeed, Harley isn’t
killing Buell because it’s unprofitable, it’s killing Buell because it
wants to invest every last penny back into Harley to save that brand
from possible failure. It’s not actually sales that are Harley’s
biggest problem – although they can’t help – it’s the troubled finance
wing. Harley’s practice of giving sub-prime motorcycle loans to
unsuitable candidates has bit the company in its proverbial ass,
forcing Harley to borrow $1 billion in operating capitol at 15%. That’s
only enough money to see it through to the end of the year. So far this
year, revenue at Harley is only down 17 percent, yet net income has fallen
71.4 percent.

The decision was made to shutter rather than sell Buell because it’s
product range and distribution network are so heavily dependent on its
parent company, that there’s relatively little value in the company
that could be transferred to a new owner.

Asked how Harley intends to replace the customers that will now be lost
to Buell’s competitors and how Harley intends to expand its appeal to
post Boomer generations, Paul is insistent that Harley’s current range
already has the ability to appeal to that audience, saying, “Keep in
mind, in the U.S., H-D holds the number two share position overall (all
size bikes) among young adults 35 and younger and we are the share
leader in heavyweight motorcycles among this group, so we know our
motorcycles appeal to young adults.

“We will continue to develop products under the Harley-Davidson brand
that appeal to riders under 35 years old. That said – and while I can’t
discuss the specifics of future product plans – you can expect us to
focus on high-impact product introductions that attract new riders and
help define the future of motorcycling. We are not ruling anything in
or out…we simply will pursue it through the Harley-Davidson brand.”

  • Matt

    How cordial is a phone conversation between you guys and a Harley Davidson representative? Are they unaware of how critical you are of their company, or do they know and only answer your questions to try to limit the damning commentary that will be posted in your site? If they know who guys are, it’s hard to believe that they think they can spin this in a way that will make you write favorably about them.

    And what do they mean by attracting younger buyers with “high impact product introductions?” Does that mean that they will have new (actually new, not just redecorated), high impact products, or will they just try to rely on new marketing techniques to sell the same old Harleys?

    Thanks for keeping us updated.

  • jconli1

    I’m sure that today’s bomb has made a score of wealthy forward-thinking wannabe industrialists (or even some old pros) start to tingle. The idea of Erik sticking around at the place that crushed his dream is a little hard to swallow, and I imagine H-D would be more interested in selling facilities, tooling, etc to someone vs. just scrapping it.

    Clearly, we’re all talking out our asses right now, but I like that the majority of people seem to be well aware of Buell’s importance (actual or perceived – and in this game perception is a great deal of it)… and feel some genuine emotion in news like this.

  • http://hellforleathermagazine.com Wes Siler

    I honestly don’t think they’re aware of the unsycophantic coverage they receive here. The thinking probably goes that, if everyone else kisses their ass, then some nobodies with a funny name must do the same thing.

    And yeah, expect some revolutionary new chrome parts or something. Harley’s mindset isn’t one of revolution.

  • carlos

    duh!

    the phrase of “attracting younger buyers with high impact product introductions” means that next years line will be all black. or flat black. or black chrome.

    yeah, that’ll revitalize the product line!

  • http://www.rumblestripradio.com The Duke

    How soon till Erik is working for Bombardier?? Not just because of the Rotax connection, but how about a two stroke motor in a bike chassis once again. Bombardier do make an EPA legal 2 stroke or two.

  • Richard

    I just hope a guy like Erik is smart enough to get out and doesnt languish at the Motor Company. It would be a huge waste of his talent. I’d like to see what he could do out there without the leash of H-D.

  • http://www.bikeexif.com Chris Hunter

    I’m not particularly a fan of his bikes, but I admire Buell’s single-minded vision and the way he has personally built a brand and a philosophy over the past couple of days.

    I’m sure we won’t have seen the last of Buell – if he still has the fire in his belly.

    • TimPerry

      Chris ,You and a ton of Harley riders have only ridden one dimensional rides that Harley has no matter what make or model, same same… I’ve been buying, riding and building bikes for 40-years. My 19 year old just bought a 984 cc buellXB9S-puts out 100 HP. with dry weight 385lbs, this bike out pulls,out excellorates out brakes out handles and out funs everything H.D and the Vrod too… I ask that before its too late everyone who rides a HD, try a buell, these bikes sound and handle like a formula 1 on 2-wheels… I ride a 102ci at 700-plus lbs. the Buell gets taken out first.. Take care and try 1–You’ll see TP.

  • Patrick

    Erik Buell to MV Agusta! Anyone?

  • generic1776

    Erik just needs to buy his own name back… the sad part is he will probably need other people’s money to afford to buy his own name.

  • Markkit

    Who knows, maybe Eric Buell had plenty of freedom at H-D and maybe he did introduce the Blast and had a leading role in all the poorly styled and positioned newer models like the Ulysses or the Firebolt with the fugly fairing (why is it with Buell fairings always look nasty, the latest monstruosity being the 1125 R..Maybe Mr. Buell lost his touch when it came to designing mainstream bikes and maybe he tried to hard to reach the younger consumer with cheesy details like the iMac G3 inspired plastic fueltanks. Maybe Eric should go back to making bikes that he knows like the S1.

  • Chris

    I will NEVER buy another product from the MoCo if I can avoid it.

  • John

    My understanding Buell had it’s hands tied in a lot aspects of these bikes…

    There have been certain parameters that buell must have.. Showcasing the V-twin as much as possible and not covering it is one of them..

  • Dave Tweed

    Wow do H-d people even bother to read each others quotes? The Q&A from H-D says they have NO PLANS of building Buell products with the H-D name and Paul Crapforbrains here posts or says they are going to or at least alludes to it. If they think they are doing so good with under 35 demagraphic I think they are going to find the age group tends to focus on family and housing and he already said the scortched earth lending practices have been a problem so what’s left.
    Smoke and mirrors. They already have products that appeal to my demographic ? What would that be the XR 1200 a heavy cow with less h/p and flickability than an xb9 and 4K more in price Good luck H-D. Thank GOD we have another American manufacturer now days for when I settle down and want to criuse.

  • Chris

    Well, well, well. What a closed minded thought process. Closing a company that had a new model to be released that could have doubled the market share of said company, to literally saying (with blinders on) that your HD products already have the ability to attract young buyers. Really? Good luck with that business plan. Good Luck with continuing to finance your $180000.00 barcaloungers to young men that won’t have the expendable income in this economy. Wow. Hope it hurts real bad when you will eventually lay off more amrican workers because of your close minded ways.

  • http://matthewabate.wordpress.com Matthew

    One more step down the road to the USA not making a single damn thing worth buying.

  • CBontheMV

    I love the corporate lingo to describe their strategy:

    “you can expect us to focus on high-impact product introductions that attract new riders and help define the future of motorcycling.”

    HD’s PR flak probably took this right off a powerpoint presentation and it’s this kind of smoke and mirrors BS that gets management into the trouble they’re in. This statement says nothing about the direction that Harley is taking. And yet, Wall Street is rewarding them with a $4 gain since yesterday’s open. That should tell you something right there.

  • RJ

    “Paul didn’t have Buell sales figures to hand and we don’t believe they’re published by Harley…”

    The Buell numbers are combined with MV Agusta for 2009:

    http://www.harley-davidson.com/wcm/Content/Pages/HD_News/Company/newsarticle.jsp?locale=en_US&articleLink=News/0581_press_release.hdnews&newsYear=2009&history=news

    9 months ending 9/28/08: 9,224 units
    9 months ending 9/27/09: 8,753 units

    3 months ending 9/28/08: 2,760 units
    3 months ending 9/27/09: 1,853 units

    Buell total units 2008: 13,119

    http://investor.harley-davidson.com/shipments/shipments.cfm?bmLocale=en_US

  • pdub

    “you can expect us to focus on high-impact product introductions that attract new riders and help define the future of motorcycling.”

    Is it just me or is it a bit of bad linguistics to use the term “high-impact” to describe a motorcycle? I know what he means and all but “high-impact” is not the kind of visualization cues that ring well in a rider’s ear. Does this guy even ride or just a power point jockey?

  • Rick_A

    I’ve spoken to Paul James at Daytona Raceway a few years ago. A genuine nice guy and a determined racer. He was pitted by himself and I felt kinda bad for the guy. When he saw my Buell attire I saw a glint in his eye and the passion he had for Buell and racing. I’m sure he’s biting his tongue and simply doing the job H-D hired him to do.

    Buell looks like a man defeated. His life’s work has just been crushed. I hope Buell and Co. can rise back up without the MoCo.

  • Kidchampion

    A billion dollars at 15% interest? One thousand million dollars at 15%? My loan amortization software just locked up. I feel anxious.

  • gdt

    Thank you so much for these articles. These are some of the most insightful and articulate pieces I’ve read about Buell — a brand and bike I’ve come to love.

  • JT

    Ya know it’s funny how things work- I was in the Harley/Buell dealership of all places, yesterday morning, and looking at the line up. I was amazed at my own apathy, I mean I like motorcycles, right? And there are lots of ‘em all around me…and yet there was something wrong about the place.
    Sort of a spiritual void, a lack of anything that spoke of wisdom, or passion, or even life affirming adventure. There were only these THINGS surrounding me. Dull, lifeless things.
    These things are actually symbols, icons of a corporate culture of apathy, and misinformation.
    I tried to find the good in them, looked out across the sea of bikes, played the game of “OK, if I could take any one of these home with me which one would it be…” And nothing. So I tried again “OK which one is the least bad, the one I could modify to make it a better motorcycle…” And again nothing.
    Maybe it’s that I know too much, why raked out front suspensions don’t work, why 19″ front wheels suck, why lightness is a virtue, etc, etc…But the unfortunate and unexpected conclusion is that I would be embarrassed to be seen on one, my super inflated ego bruised by the association with such a cheesy, pandering, ethos. The same reason I don’t wear mirrored sunglasses.
    I guess that I take the whole “motorcyclist” thing too seriously, am too much of a nerd about it.
    But then it hit me- these motorcycles aren’t made for me. They are made for people who don’t know anything about motorcycles. It is in fact the stunning corporate mantra of Harley Davidson!
    Never in the history of business has such a giant and egregious scam been perpetrated. Andy Warhol’s business model taken to a new and ludicrous extreme.
    And this is the company that owned Buell. It has been through this lens that I have looked at Buell since the HD takeover in 1999(?). As a point of fact, I LOVED the S1 lightning. It was, and still is an iconic motorcycle. The S1 re-defined the streetfighter, invented the hooligan bike, and was in fact SOULFUL. It had this kind of handmade quality, this craft element, innovation, passion, in a word it was “alive”.
    Then the takeover. Little by little Buells became cheaper, more mass produced, and less and less spiritual. Oh I know, they became better tools, more to the liking of the editors of motorcycle mags, cheaper to make, but somehow “lost” at the same time.
    The dummies a HD were so scared of Buell cannibalizing V-Rod sales that they denied him the technology, sticking him with anachronistic sporty motors with the output sprocket so ridiculously low that the motorcycles needed tensioner pulleys. What if Buell had gone from S1 Lightinings to V-Rod motored streetfighters, and roadburners? Why bid H-D want Buell to fail?
    The answer is simple: information.
    Erik Buell has information, he knows the difference between good motorcycle and bad ones. This simple fact makes him a liability for Harley Davidson, who’s entire sales revenue relies on MIS-information. If Erik Buell had been allowed to create compelling product, ignorant harley people might realize the inherent and blatant design flaws of H-D’s core product. Too dangerous, too risky.
    Just think of the millions of dollars tooling to make a Fat Boy at risk, millions of dollars of tooling to make Road Kings, Millions of dollars of tooling to make Dyna Wide Glides…..
    For a company who’s corporate culture is at it’s root, deceitful, I am amazed that a guy like Erik made it for as long as he did.
    I met him once, and at the time he seemed like the worlds unhappiest man. So my message to Erik is- Quit. Take your business elsewhere. Being out of the motorcycle business for a spell might bring things into focus for you. Play with something else for awhile, have fun again. I know that you are hurting right now, but letting go is the only path to Zen, and a Buell motorcycle should have Zen, they haven’t for quite some time. — JT

    • TimPerry

      JT ,I’m with You all the way… but Buell is making great bikes, and shouldn’t quit..The HD dealerships let Him down through no one passionate enough to sell how great these bikes are.the specs prove it.All the cookie cutter HDs in the showroom put would be-,, HD future owners too sleep,with the smoke and mirror showrooms and neon, thats what it takes to sell the image, not a true,road burner,track-streetbike that sat in all the showrooms. Maybe 2-3 models in a corner near the water fountain. That was the mistake, no control of professionals to promote the Buell line.. Its so sad… More LaterT.P.

  • Jason Trevis

    Well done HD!

    I guess you will be off to the emergency room to get that bullet wound in youur foot seen to very soon.

    Not content with stealing the Vrod engine from Buell, as this was an idea that could have only come from a person with revolutionary thinking, you now get rid of the machines and the people who make them because they were starting to make your two wheeled tractor owners wonder why their bikes did not handle, were over weight and cost over twice as much.

    Play with the emotions of the public at your peril.

  • JT

    Neutrality?
    I think that you are a person who dwells in the subjective. So let’s for a moment, Mr. Troll is it?, delve into the objective. Harley Davidson are purveyors of deeply flawed merchandise. There motorcycle are – by design – bad motorcycles. This is not an opinion, it is the elephant in the corner. I don’t suppose that you have ever actually READ anything about motorcycle design, am I right? Well, Mr. Troll? Perhaps you are more of a ghost flames and skulls kinda guy…
    The fact remains that Harley design is bad. The swing arm pivot is too low! The chassis look like they were made in Kazakhstan! The motorcycles weigh 700 pounds! What, am I the only guy out there who did his homework? Jesus, sometimes I feel like the only guy seeing the naked emperor!
    Dude, I’m surrounded by brain eating zombies!! –JT

    • TimPerry

      JT.. about Troll…. EXACTLY. I love You Man from another anti HD Man.

  • JT

    P.S. since when has telling the truth been a bad thing? Hey Troll go read some Ayn Rand you fucking commie corporate suck up! — JT

  • Dave Tweed

    The thing I see is that H-d is run like a chicken that just got whacked, I believe 10/13/09 We will build a new facility for buell-10/15 Buell is done
    WTF the dates may be wrong but the statements are not.
    The co. posts 84% off from last year but stock prices rise EPIC FAIL WALL STREET NO INSIDER STUFF THERE EH.
    We are going to focus on H-D and new markets where? India the country that builds a $1400.00 dollar car GOOD LUCK, Europe where fuel is $9.00 a gallon GOOD LUCK I know they are good on gas well how many people actually know that how many Europeans well I hope they turned the light off when they left.
    After all this I can still say honestly I do not want TO HATE HARLEY BUT I DO because the American machine has been ruined by a bunch of yuppie parasites and they have Temporarily killed the American Sportbike
    Please Troll dude tell me H-D is an Icon it will never go under can you say AMF 2 times I can oh wait how about GM or AMC and Studebaker

  • JT

    and then ATLAS SHRUGGED — JT

  • http://pwadas.jewish.org.pl/EB/ DT


    I use Sendmail for MTA, Debian Linux for OS, Windowmaker for WM, Rand for philosophy,
    and The Last Buell for a ride. And I consider these best of the best a man can get.
    Please, let me know, when a better stuff’ll
    arrive, so I could pick it up and include in this list. Thank you.
    -

  • http://dtpw.pl DT

    Remember this paragraph from Rand, when a smaller steel factory with was closed to help-up Associated Steel? Finally they both went down.

  • JT

    So Troll, your supposition is that- because it’s popular, it must be good? By that logic Brittany Spears must be on of the all-time greatest musicians ever! She is better than Beethoven, right, I mean she outsold him…..
    See the problem here is that Troll, and people like him, use the whimsy of subjectivity as a metric because they reject science, knowledge, and wisdom. Troll doesn’t WANT to know anything about the physical laws that govern motorcycle dynamics. He, and his ilk, relish wallowing in their own ignorance. Acres of chrome veiling an inconvenient truth, and in their desperate search for individuality, sadly, they have all become the same person.
    This is American motorcycling. –JT

  • JT

    Hey wait a minute….Wes are you posing as Troll to get me to keep rambling? This is a joke right? –JT

    • http://hellforleathermagazine.com Grant Ray

      Afraid not, JT. Wes is too busy at the moment at Skip Barber’s. And it’s not me, either. Troll is funny, though..

  • JSA

    all in favor of The Troll say “I”

  • JSA

    I

  • http://www.advrider.com Tex

    Would it have been possible for HD to sell off Buell itself? If so, would not that have made more sense than just simply killing the brand?

  • Dave Tweed

    I will wait for the obligitory I told you so my Chromosexual compadres. BTW I didn’t say I do not own a Harley Davidson jealousy is truly not an issue BTW want to buy a Harley ?

  • Mike C

    There are many Kinds of motorcycling. Crusiers are a bit like custom cars, It’s more about the social network and that new doodad I just bolted (welded rivited molded chopped etc.) onto my ride, a noble pastime, with a strong history and tradition. Buell for me anyway was more like the original roots of Harley Davidson, they started out making bikes so people could get out and see the country, bikes you could take down a footpath if you wanted to without worrying about banging up the paint. Buell made bikes that are fun to ride, maybe not as cool to look at, and not as easy to customise (if you can call bolting on some new chrome piece you bought from the dealer customising) I’ve always loved Harleys, but to me a Buell is the best of both worlds. Too Bad they let short sighted bussiness weasels kill the company instead of promoting the bikes more. When every bike on the road is a custom, none of them are. Dinosaurs became extinct for a reason.

    • TimPerry

      Right On Mike C. and ride On- a buell a real adventure to feel Your ride, not to sit polish and look at ????

  • Charles

    “Chromosexuals”
    that is truly epic(Pynchon?Joycean?)
    Language(the 1st tool?) crafting catharsis.
    I thought HD made their gazillion$ on T shirts&belt buckles&consume boutique excretions.
    I love the V rod & amazed how rare any of the moneyed class I ask has even taken a test ride.
    Or how poor the ride is. No telling what Eric could have made with Porsche, Eh?
    I vote Eric & the last individualists in America build Buells with soul &Porsche engines.
    & don’t believe Ann Rynd or any other self obsessed intellectual purist cared for “individualism” in any loving Democratic idealist sense for anyone NOT their class equal.
    Wall Street IS fear&greed.Obedience to their corporate oligarchy overlords is what much of HD & corporate America & Congress do.
    When in doubt try to be kinder &Learn to pray.
    Best T shirt seen at Biketoberfest:
    “I rode my motorcycle to a trailer convention.”

  • TimPerry

    Troll just go and test drive other real motorcycles other than a HD. Ducati, Bmw, Triumph and hold on You’ll never get the rush of true engineering, all these companies look to make more power and speed out of everything they do. Harleys are a nice bike but compared these real performance machines will outmatch and outperform any Hd on any road,strait, curves, You name it. I tried to be decent because I know People get so bent out of shape on forums like this, so be cool man its still all about the ride and everyone is different..Later

  • Joe

    Hey Tim, you got it right with that last statement, everyone is DIFFERENT!! Me and a lot of other people are NOT into speed and performance like YOU are. If that is what you are into, fine. Some people are like me and are ok with doing speed’s right around the speed limit. I know it is tough for a lot of people on here to understand that because they like and own sportbikes and bikes with a lot of performance but believe it or not most of the HD crowd and cruiser crowd are ok with just cruising. I have also ridden my share of BMW’s and Truimphs (no Ducati’s). I have ridden a bunch of Japanese sportbikes also and I don’t like them. Sorry but that is my feeling and again believe it or not a LOT of other peoples opinion too because I see a LOT of HD and Cruiser bikes out on the road and these people are HAPPY with there bikes. Where I live (northeast) there are WAY more cruiser bikes on the road then sportbikes. I think that a lot of the crowd on here hate HD because there are so many of them on the road and they for the life of themselves can’t understand why these people don’t want to have a really fast bikes and go to the track on track day and race it and in general have a really fast performance type bike. Sorry Tim but as you said EVERYONE IS DIFFERENT, just try and accept that they DON’T WANT WHAT YOU WANT, Ok?? Later!

  • Dave Tweed

    Hey there what about a ULY or an XT hell even a Blast they are not made for carving it up (although they do it quite well)the uly is the most comfortable mc I have ever ridden it has a H-D power plant so do most of the buells they just don’t weigh 800 pounds and cost over 13K.
    Bikes like this are more the future than crome cows, cheaper lighter good handling capabilities. I am sorry current H-D’s don’t have any of these things. Well things don’t seem to be going well for the mother ship anyway down a dollar even after selling every 1125 in stock
    http://quote.morningstar.com/Stock/s.aspx?t=HOG
    Buell will rise again will H-D

  • RV wolfpack

    FU HD