Motorcycling’s small, foreign future

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“The goal will be churning out more than 60,000 bikes a year,” Ducati boss Claudio Domenicali said in an interview with MotoSprint yesterday. “To do this we need to increase our sales in Brazil and India, therefore we will build two factories, one in Brazil and one in Thailand.”

Sound familiar? It should. KTM is doing something similar with the 125 Duke and other future models and that’s exactly what Honda’s doing with the CBR250R too. You’re witnessing the future of motorcycle production — smaller capacities, products targeted at developing markets and manufacturing in countries with cheap labor.

Art: KTM

Look at the KTM 125 Duke and you don’t see a the budget lash up the €3,500 price suggests. Instead it looks like a high-spec, full-size, exotic streetfighter. Components like the Brembo radial brake caliper, USD forks, steel-trellis frame, and the swingarm with its exposed webbing look just like the same parts on the KTM 690 Duke. The little Duke is meant to launch KTM into the youth street market while making strong overtures about the benefits of continuing with the brand to its teenage riders.

KTM’s able to do that because it leveraged its partnership with Bajaj to manufacture the 125 Duke in India with Indian-sourced components. That Brembo caliper? It’s made by an Indian subsidiary of the Italian brake giant called BYBRE. KTM’s trick is ensuring that the Duke meets Western standards of quality, design and performance at an Asian price.

The Honda CBR250R pulls off a similar trick. Look at it in person next to the visually similar VFR1200 and it’s the smaller bike that looks better. Less bulbous proportions pull off that trick, but it’s remarkable that none of the components on the $3,999 CBR250R fail to meet expectations next to the $15,999 VFR.

Again, that’s because Honda decided to manufacture the bike away from its traditional first world facilities. It’s a brand new motorcycle, yet it’s priced the same as the Kawasaki Ninja 250, which has been in production (in Japan) largely unaltered for 25 years. Kawasaki no longer needs to pay off the tooling or R&D costs on the littlest Ninja, yet it can’t sell it cheaper than the Thai-made CBR.

Honda is also going after the youth European market with the CBR250R, where the similarly Thai CBR125R has been a top seller since its release in 2004, but it also plans to sell the bike worldwide in markets as diverse as the US and its native Thailand. The same bike that’s considered a budget beginner machine here is thought of as a large, fast, fancy motorcycle in the country where it’s made.

That the same motorcycle, a motorcycle of a capacity and spec widely considered inferior in the west, can achieve significant sales not just in the US, not just in Asia, not just in South America, not just to European teenagers, but worldwide, is what makes all this so important.

That gargantuan Japanese manufacturers like Honda sell tons of small-capacity motorcycles overseas is nothing new. In 2010, Honda sold 18 million motorcycles worldwide while the entirety of the American motorcycle market accounted for just 439,000 total sales for all manufacturers last year. What’s new is niche manufacturers of premium products who formerly relied on selling expensive motorcycles in North America and Europe for all their sales are now starting to look elsewhere.

Ducati embodies that shift. No other maker, with the exception of Harley-Davidson, has better perfected the art of selling $15,000 motorcycles no one needs to Americans buying them on credit. Sure, they continue to make the big, fancy bikes, but if Claudio’s growth predictions are going to come true, bikes like the Diavel and Multistrada 1200 are increasingly going to represent a drop in a bucket full of smaller motorcycles. Compare the 8,000 Diavels and 8,000 Multistradas Ducati plans to make per-year to 60,000 overall sales and you can see the disconnect.

What’s this mean for you, the consumer? Well, we’ve probably seen the end of top-end performance bikes dominating product portfolios and burning up R&D budgets with major updates or even all-new models every two years. We’ve been spoiled for the last couple of decades with a plethora of unprecedentedly fast, technologically advanced motorcycles. With an average product development cycle taking 36 months from inception to retail, the bikes we’re getting now, the S1000RR, the ZX-10R, the RSV4, Ducati’s new superbike that’s coming this fall were all intended for 2007’s booming market. They also likely represent a golden age for the performance bike, the likes of which we won’t see again, at least in terms of choice. We’re not saying bikes like the RSV4 are going to go away, we’re saying don’t expect an RSV5 in 2012.

But instead of tons of brand new superbikes, we’re going to get more affordable, small to mid-capacity bikes of the kind in the examples used above. The kind of bikes that can be just as appealing to young riders in America as they are to mature riders in Thailand.

Look to KTM, Honda and, soon, Ducati for an example of how well this can work. Just like Cleveland CycleWerks is doing on a smaller scale, the large manufacturers are learning to control the quality at sources of cheap manufacturing and the savings are passed along to you, the end customer.

That also marks a fundamental shift at a manufacturer level away from focusing on sales to the Boomer generation and towards people in their teens and twenties.

“In my opinion, this the biggest single challenge for today’s motorcycle manufacturers,” KTM’s Stefan Pierer told Alan Cathcart. “How can we direct our future products towards a younger customer? Because our average customer at KTM gets around seven months older each year, Harley’s is already on the way to the retirement home, and BMW’s average customer was getting on for 60.”

If the increasing number of appealing, affordable small- to mid-capacity bikes can continue to increase at a time when western economies continue to operate in austerity and fuel prices continue to increase, we could see the genesis of a entirely new motorcycle culture. One rooted in mean transportation and social club membership instead of masculine image and status statement.

The big news in 2011 isn’t bikes like the ZX-10R or Diavel, it’s the rise of the small, appealing, affordable motorcycle.

  • ike6116

    I would love like a duke 500

    • je


  • Glenngineer

    That little duke is by far KTMs best looking naked. If they built a 690 that looked like that…I’m moving to into Boston in May, I’d love to ditch the DL1K for something lighter.

  • Debrando

    Or even less,say 400cc Duke.

    • Kyle

      I came buckets at this idea

    • Taco

      Gimme a Duke between 250 to 450cc and I’ll be on Team Orange for life.

  • Mark D

    Would a small, 250cc Ducati be even more of a brand betrayal than the Diaval?

    Just a thought; if its similar to the CBR250 in that the components are “premium” for the price point, I don’t think so. After all, Monsters aren’t exactly top-of-the-line race bikes, and sell bucket loads, but have only increased Ducati’s image as sexy, fast, exclusive bikes. I’d love a 500cc single desmo Mini-Monster.

    • aristurtle

      There’s nothing wrong with a small-displacement race bike. I mean, hell, even MotoGP has a 250cc class now. I’d love a 250cc sportbike with a firmer suspension and more rearward foot position than the current Ninja/CBR set is providing.

    • pavinguire

      Ducati made a lot of small bikes back in the day, bevelhead singles, etc… Call it going back to the brands origins…

      • Mark D

        Hmmm, so did HD, way back in the day. Maybe they can get in on the game, too?

        • Peter

          Ducati’s roots in the small displacement game are a bit different from HDs, at least in my mind. Ducati’s stuff was developed in house versus Harley buying Aermacchis and then re-badging. I can’t see Harley pulling off a move to smaller displacement stuff. Ducati, maybe.

    • vigor

      1969 Ducati 450 mk3 Desmo, droollll

  • Devin

    Hmm, the exact kind of bike I like is going to have increased availability? I’m down.

  • JonB

    Bring it on, couldn’t read more exciting news on a Wednesday.

  • pavinguire

    Ninja 250 was made in the Philippines, not Japan, until the 2008 revamp, now it’s made in Thailand…

    • Zach

      The sticker on my 06 says Made in Thailand.

  • Kevin

    Unrelated: Am I going nuts or was there a story this morning about the BMW K1600 that is now nowhere to be found on the site?

    • pavinguire

      you’re not nuts, it has disappeared…

    • Wes Siler

      There was a little political issue with one of Kevin’s freelance clients. We’ll be able to put it back up tonight or tomorrow. No biggie.

  • MotoRandom

    Oh crap, paradigm shift. Between this new wave of microbikes and the electrics, we are in for some big changes. An interesting question comes about. How will this affect the custom motorcycle subcultures? Are we becoming obsolete or heading for a weird collection of niche markets? There seems to be a strange disconnect with young adults of today and the cults of personal transportation. I don’t see them embracing our way all that much anytime soon. Is motorcycling moving away from art and passion and heading towards something boring and practical? Curiouser and curiouser.

    • robotribe

      “How will this affect the custom motorcycle subcultures? Are we becoming obsolete or heading for a weird collection of niche markets?”
      If by “custom motorcycle” you mean stretched chrome, metal flake flame paint jobs, dodgy geometry and handling, inflated ego pseudo-super-star builders with prices to match, that shit is OVER. Exhibit A: West Coast Choppers Closes Doors

      “Is motorcycling moving away from art and passion and heading towards something boring and practical?”
      If this translates into more bikes on the road vs. cars, then I welcome it with open arms. There will always be those who tweak their bikes to their heart’s content, regardless of the numbers of others who are content to ride their bikes with the same passion (or lack thereof) as those who drive Accords or Camrys.

      Here’s the rub: all of this increased manufacturing is in response to growing markets in ASIA and SOUTH AMERICA. The custom chopper “phenomenon” was an American aberration. It’s not as if this has any meaning for the larger population of N. American riders who’ve been conditioned to assume as with many other appliances, BIGGER is better when it comes to motorcycles.

      The American power sports market is f*cked, and it did it to itself.

      Just sayin’.

    • Wes Siler

      The absolute blast we had riding those WR250Rs, even on the road, has me thinking that small, light and basic means more fun, not less.

      • adeysworld

        You’ve stirred my interest in these little devils.

    • Erik

      Cruise on over to and check out what the kids have been up to. Turning horrible 80′s 350-400 jap twins into minimalist street trackers using found parts, like fifties bobbers used to do. The result is the real deal, honest, good looking customs on a Kraft Dinner budget.

  • Ilya

    Cheap manufacturing is a funny thing. First, it’s not going to be cheap forever. Second, what these “cheap” workers will be doing once they make good money? Yes, right, they will start buying cars. I’m very familiar with one motorcycle company, which lost 99% of it domestic sales in less than 5 years when cars became affordable for masses. The transfer of manufacturing facilities to Asia is a plug, not a solution. Purely on my opinion, of course.

  • dux

    …and the US economy continues its downward spiral.

  • jason

    It is about time. Something is just wrong when motorcycles go from Burt Monroe to Malcom Forbes. The era of ’40k Kustoms’ has to die. That wanna-be outlaw with a platinum card who can’t work on his own machine is the death of the whole thing. Bring back small. simple. and FAST.

  • Liquidogged

    I’m with everyone on the need for smaller bikes. But there are two problems here, which will most likely have a huge impact on how much this small-bike future will come to pass.

    1. Emissions. My understanding is smaller bikes have a harder time meeting emissions standards. I’m sure manufacturers are doing their homework to make sure their products are meeting standards and regs now, but that’s going to get harder in the future as standards go up, along with our sea levels. Smaller bikes use less fuel and less of a lot of other things, but the output of environmentally destructive chemicals is not reduced as much as you’d think. Normally I don’t talk about this much here, but this article seems to take the long view, so let’s go ahead and factor things like this in. Climate change isn’t going away.

    2. Foreign manufacturing. The same rise in the price of fuel that makes these bikes finally attractive to western markets means that the price of building and shipping these bikes is going to go up as well. There will come a time when shipping a container of bikes overseas from Thailand to America is going to swallow up enough of the profit that it doesn’t make sense to do it anymore – and I’m betting that time will come sooner than Honda or anyone else can inundate the American market with these cool little bikes.

    The long view is that we are stuck between a two-pronged problem: dwindling (and therefore more expensive) fossil fuels, and increasing occurrence of disastrous environmental damage due to climate change. In that context, tomorrow’s transportation solutions need to do a hell of a lot more than just burn less fuel and cost less to make.

    Sorry to be a buzzkill, I love these small bikes too. But this is the world they’re coming into.

    • Wes Siler

      1. That’s nothing to do with their capacity in general, just a reflection that many small bikes use older engines. Logic dictates that a single 250cc cylinder should be putting out less nasty shit than four cylinders of the same size, it’s just that bikes like the Ninja 250 are FAR from modern.

      2. That’s foreseeable, but also a long way off. You can ship a whole container full of little bikes far cheaper than shipping even 2-3 cars.

      • Liquidogged

        1. Good point. I did some digging and it turns out the EPA raised the standards for all sizes of bikes in the mid 2000s by quite a bit. Modern doo-dads like fuel injection and catalytic converters provide hefty reductions in emissions these days. That said, for some pollutants bikes of all sizes still put out more crap than cars do, so if we’re talking about a mass movement towards bikes of any kind, smaller or otherwise, this is still going to come into play.

        2. Are the bikes as profitable as the cars? Given the state of motorcycle sales in the USA, one has to wonder. The other thing is that rising fuel prices affect not just shipping cost, but manufacturing cost. High shipping alone isn’t going to render foreign manufacturing useless, but when you factor in increased costs of raw materials as petroleum becomes more expensive, things get tricky. Don’t forget that our civilization essentially runs on petroleum products, so when the price of that goes up, the price of most things goes up, over time.

        I’m not a doomer, but the whole system is fragile enough that looking forward to a renaissance in small capacity bikes begs a certain amount of caution. It seems weird that there is so much coverage of e-bikes and smaller ICE bikes on HFL, but very little discussion of how resource depletion might affect fuel prices, bike prices, and the motorcycling culture at large. In the context of an article like this, it’s really the elephant in the room. The piece is otherwise very insightful and you make good observations – all I’m saying is that the move towards smaller bikes is taking place at a crucial point in the development of the relationship between civilization and the fuels that propel it. That, to me, is more interesting than the fact that the 2011 ZX10 is another spec-sheet overkill cruise missile that will have far less impact on motorcycling than the small bikes being released this year – true as that may be.

        • Wes Siler

          Well, I don’t think we’re going to run out of petroleum overnight. In general, rising fuel prices will affect absolutely everything, as you suggest. We’ll all be learning to live more frugally than our parents and small, fun, economical bikes will likely be a part of that. A CBR250R is a lot easier to afford, run, manufacture and ship than a CBR1000RR.

        • MotoRandom

          Excellent point! And definitely what I was trying to root out above. We need to step back and look at the bigger picture. Yeah, petroleum is not going to run out overnight but between daily unrest in the mideast and big increases in demand from China and India, there are going to be huge effects on supply. Pile on the obsessive and constant message of the need to go “green” that the young folks are getting daily and it all adds up to a huge change in our culture. The boomers didn’t start the custom subculture explosion, their parents did after WWII. That’s a matter of given history. Their self indulgent credit spree 10, 15 years ago exploded it into something unsustainable. Yes, the chopper fad is looking clearly dead at this point but it doesn’t take much to see the cafe and scrambler movement riding on the same thin ice. All I’m saying is maybe we should take a look to the horizon and question if those dark black clouds are heading our way.

  • Duncan

    This is why HFL is worth every cent, even to those in the industry.

    • DougD

      I was just thinking that the other day. I guess it’s because when you’re so interested in a niche subject, both the typical ‘consumer’ and ‘trade’ news is of equal importance.

  • Daniel

    I would expect quite a few new 250 to 500cc models for 2012 or so, at least in Europe, when the new license limits us all to 47hp (35kw) for the first 2 years…many people will just pick one of this bikes and stick with it even when they can ride more powerful ones after the 2 years.

    Currently only Spain has this license (so most brands havent moved a finger yet) , but for the next year many European countries will join.

    The new CBR250R and (rumoured) KTM 250 duke will arrive the European market just in the precise moment for this new license, making them the ideal bikes to stick with for at least this first 2 years, and real easy used re-sellers. Buy it, use for 2 years and sell it to any other new rider, then buy a bigger bike.

    Also you can see BMW preparing for this: The new G650GS is homologated to exactly 35kw, which is the 47hp we can ride with this new license. Yamaha’s and Aprilia’s mono’s will see their power lowered just a bit to match 35kw, and so on…

    So in 1-2 years we will have a wide range of 250-500cc bikes which will deliver less than 47hp, some bigger monocilindric bikes, with exactly 47hp, and then a choice of more powerful bikes of up to 95hp (expect the most popular nakeds having their power lowered from 100ish to 95hp at least in europe), wich is the max power the original bike will be able to have prior to power limitation.

    Im not saying that european market is more important than asian market expansion, but, it can’t be just a coincidence :)

  • gregorbean

    Looking forward to more and more of these options reaching the states.