Lies, damned lies and Ducati sales statistics

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Why do we give manufacturers such a hard time for over-enthusiastically representing their successes? It has to do with a sickness we see in the motorcycle industry; a detachment from reality that leads to dishonest marketing, dishonest journalism and an inability to objectively evaluate problems, then act to fix them. If we, as a hobby/passion/industry/whatever can’t be honest with ourselves, then how are we going to identify what our current problems are and then work to fix them?

Last September we picked on Harley (unsurprisingly) for claiming it was creating new young adult riders when its number of them was actually shrinking, BMW for using percentages to overstate sales results and even the Motorcycle Industry Council for claiming a boost in motorcycle safety when really it was just a case of fewer new riders on the road. Now it’s Ducati’s turn. “68 percent retail sales growth.” ZOMG, really?! Hurry guys, let’s rush to reprint that!

Update

Here’s the other reason we do this. All these overly enthusiastic press releases get published unedited and without context in publications over eager to fellate manufacturers so they can keep getting free meals and free bikes. Regurgitating press releases isn’t journalism. Come on people, our job is to provide the public with critical thinking, not repackaged marketing. We’re not asking for Woodward and Bernstein here, just some Journalism 101.

So what’s Ducati claiming? Oh, just a 68 percent retail sales increase in Q1 2011 over Q1 2010. The problem is, Ducati is a privately held company, so we can’t look at the actual numbers to back that up. Instead, let’s turn to bike designer, industry analyst and HFL contributor Michael Uhlarik for some context.

“Sales figures are not public, but certain things stand out in the press release,” Michael wrote us this morning. “For one thing, saying it has been ‘the third quarter of positive sales growth’ is meaningless. Of course it is, every year in every western nation sales bottom out heading towards December and slowly pick up from January on. If they didn’t experience ‘positive growth’ in Q1 then they would be in deep trouble.”

“As far as impressive percentages go, it doesn’t take a very large sales volume to post figures like that when your global output is less than 40,000 units annually.”

“Let me explain. In Q1, everybody not selling commodity-priced motorcycles in Asia and elsewhere is looking at very small sales figures. At 40,000 units sold per year (globally), the mean sales figure is 3,333 motorcycles per-month across 12 months, so it is not an unreasonable assumption to say that, in January to March, a niche luxury brand like Ducati might sell 1,000 units a month (globally), with the spring and summer off-setting that figure with substantially greater sales.”

“North American sales are obviously less than global sales, but let’s work off that global number since it’s all that we have. 68 percent of 1,000 is 680 machines, multiply times three and that’s 2,080 motorcycles in a quarter, not exactly Earth-shattering stuff given that the company just launched the Ducati Diavel amid great hype, so it stands to reason that most of this upshot will be deposits on those. Considering that any new product launch is the hottest time for sales of a given model and that the Diavel is a niche model with a reported 8,000 production units planned per year, 680 bikes per month equals about 8.5 percent of the total. Not an amazing figure by any stretch, it simply states that the Diavel is selling as predicted.”

But that calculation is done using global numbers. It’s our understanding — and this was unofficial and off the record — that Ducati North America’s best sales year ever, 2007, only saw 10,000 motorcycle sales. Ducati’s sales are likely much less now, given the industry’s overall slump from 1.1 million sales in 2005 to less than 500,000 last year. Divide that peak figure by four and it’s 2,500 sales per quarter, not accounting for winter. 68 percent of that is just 1,700 sales. That’s using sales from four years ago, not now.

“It stands to reason that this rate of growth will trail off in Q2 and Q3 as the early adopters have all gotten their Diavels and growth again reflects the mainstream market and Ducati’s existing market pool,” continues Michael. “Of course, all of this is making assumptions about volumes, because Ducati does not reveal them publicly, but the givens are total annual output and the assumptions are reasonable based on global market trends.”

All of a sudden, that 68 percent increase doesn’t sound so freakin’ exciting does it? The US is going to be the Diavel’s biggest market yet, at best, it only sold as-predicted during its much-publicized roll out. We’ve reached out to Ducati to confirm that the sales increase includes Diavel sales (deliveries began last month, dealers were taking deposits before then) and we’ll update this article when we hear back. Regardless, the conclusion stands. 68 percent might sounds exciting in a press release, it just doesn’t mean much in the real world where people like you and I live. The point here isn’t that Ducati didn’t sell 68 percent more motorcycles this year than they did last, it’s that “68 percent” sounds and awful lot better than “a couple hundred bikes extra.”

Update: Ducati says, “The retail sales mentioned are DMV registered units out on the road with customers. (In other words actual sales- no fluff. In the Diavel’s case only units sold the last week or so of March). All sales quarters were up in comparison to the same period the prior year, not consecutive quarters.”

  • robotribe

    HFL hates [place a motorcycle manufacturer name here]!!!!!

    • Lacubrious

      Only if it’s over $6k and not a old japanese cafe racer or a BMW dual sport.

  • ontheroad

    I appreciate what you guys do here at HFL and your assumed role as moto-journalism watchdog is no exception. I’ll just say this in critique: “over eager to fellate manufacturers”…? Them’s fightin’ words. Calling the major magazines cocksuckers doesn’t really contribute to the piece, but I’m sure it’ll stoke some fires: is that what you’re after?

    • http://hellforleathermagazine.com Wes Siler

      I’m not calling anyone names, but reprinting press releases to readers with no comment, no context, yet plenty of enthusiasm is just a very base thing.

      • ontheroad

        It’s true, you’re not. I was just taken aback by the choice of words in an otherwise civil & cerebral article. I agree, it’s shoddy at best and all too common. Ultimately, I’m on the side of HFL and earnest journalism; whenever you feel like taking a shot at the newsstand fodder, fire away. I suppose that, after the whole Nesbitt/Frank business, I’m just leery of antagonism creating a din that detracts from all the other great content here. Carry on.

        • http://worldof2.com/ jpenney

          In the last week there was a story based around Wes liking to have sex with girls and a story comparing a woman’s ass to the Hayabusa. The “fellate” Comment doesn’t seem out of place.

          • Steve

            “publications over eager to fellate manufacturers”

            As opposed to simply being appropriately eager?

            • Grive

              Well, if they like the cock, they like the cock. Nuthin’ wrong with that. They can be eager for some cock. It’s their prerogative.

              Now, if they get too excited about it, or they let that eagerness affect their duties, then it’s a bit too much eagerness for cock. So yeah, they get overeager to get some cock.

              :)

    • Tyler

      You can see this even in other reviews like for games – the previews will talk about all kinds of new features and additions that are really neat, basically mirroring what the company says they’re adding to the series. Then the review comes out, and suddenly they think all of these things are garbage.

      I’ve seen this a lot in moto mags, where they mostly go over the new features that they’re told about. Meanwhile you’re like: “does that really matter” or “does it make any difference”.

      • http://www.facebook.com/beastincarnate BeastIncarnate

        To be fair, Tyler, a lot of things sound great in concept and aren’t executed well. It’s especially true in the gaming where there are countless over-promises. A lot of games journalism is crap in the same way much of moto journalism is, though, and for the very same reasons. Don’t suck up enough and you don’t get access. Few people have the money to buy every new game and fewer have that money and the amount of time to dedicate to a good analysis. It’s just that much worse in motorcycling.

        Speaking of, it’d be pretty cool if more people allowed HFL to use their bikes for reviews. Wes or someone flies out, spends some time with a reader’s bike, done and done. There are liability issues and all that, but it’d be a heck of a way to get more of that content. I’d be up for it.

        • Tyler

          This is true. However, if it’s a hands on preview and they’re like “wow, awesome new stuff!”, then that’s not cool. Previews are rarely (if ever) skeptical of the product, it seems.

          I agree with everything else you said :). for bike reviews, I thought that would be pretty cool. Perhaps user reviews could be done?

  • RSassi

    Circle jerking around with the obviously flawed purveyors of pseudo-journalism is the antithesis to objective rational critical thinking which is the only solution to these problems and helping consumers make more informed decisions. Emoting over every little hardly perceived hint of snobbery, confirming bias, is barely a criticism, it’s closer to rooting for the status quo and the flawed system itself.

    Journalism is journalism and so it’s by nature not sparing of exaggeration trends ass-kissing for profit. Making concessions to idiocy may make everybody feel good but it doesn’t ever concretely help anyone.

  • Kirill

    The veil of secrecy around motorcycle sales continues to amaze me, especially considering that their counterparts in the auto industry release pretty detailed results every month. You’re 100% right in calling BS on them releasing just a percentage figure, that tells people nothing. Tell us how many bikes you’re moving, and what bikes are being moved.

    There is one issue with Michael Ulharik’s commentary here, specifically the interpretation of the “third quarter of growth” line. Presumably, Ducati means the third consecutive quarter of year-on-year growth (that is, Q3/Q4 2010 vs Q3/Q4 2009 and then Q1 2011 vs Q1 2010), not quarter-on-quarter (Q1 vs Q4 vs Q3 vs Q2) as he implies.

    • http://hellforleathermagazine.com Wes Siler

      Here’s the full line: “Ducati North America is proud to announce its third consecutive quarter of motorcycle sales growth, beginning 2011 with a 68% Q1 retail sales increase over the same period in 2010.”

      • Kirill

        Yeah, I went and read the press release before making that part of my comment. Based on what I’ve seen in automotive press releases (and press releases in general), I stand by my interpretation that they’re on the third consecutive quarter of year on year increases – specifically, that Q3 2010 was better than Q3 2009, Q4 2010 was better than Q4 2009, and Q1 2011 was better than Q1 of 2010. This way, the seasonal fluctuations between months/quarters are accounted for since those aren’t likely to change year to year, barring natural disasters and economic apocalypses.

        If they are comparing different quarters to each other, then they’re extremely desperate to toot their horn and are in serious trouble. And, of course, we wouldn’t be having this stupid argument in the first place if they’d just show the numbers.

        • Miles Prower

          I’m with Krill. When my companies report “growth”, we are stating figures based on a time difference of one year. Therefore, first quarter growth is relative to first quarter sales from the previous year. Likewise, March growth is relative to sales in March of the previous year. Therefore, consecutive periods of growth means for each period, we look at the corresponding period from the previous year.

          • http://hellforleathermagazine.com Wes Siler

            Regardless of which it is, this “growth” is merely less bad than the previous year’s results and still well down on 2007.

            • Kirill

              I don’t think its fair to compare 2011 to 2007, given the continuing difficulties in the economy and massive repatriation of our money into the coffers of various banks in 2011 and the bubble-bloated numbers of 2007.

              • http://hellforleathermagazine.com Wes Siler

                Ok, let’s compare 2011 to 2006, 2005, 2004, 2003 or heck, any year back to the mid to late ’90s.

                • Kirill

                  Sure…wait…uh…do we have any of those numbers?

                • http://hellforleathermagazine.com Wes Siler

                  Nope. They don’t release any numbers, which is sort of the genesis of much of this rant. Simply stating percentages, only when they’re positive, is deliberately misleading.

                  I could state we sold 68% more subscriptions today than yesterday. Good, right? Not if this week is 50% down on last week. And you still don’t know if I’m talking about 100 subscriptions increasing to 168 or 5 subscriptions increasing to 8. Heck, I should just start issuing random press releases.

      • ktaisa

        You should read the numbers the fed puts out. Hahaha
        Talk about bullshit…

        • dux

          60% of the time, it works every time.

      • http://pics.zenerves.net/index.php?gallery=vehicules tropical ice cube

        BTW: There is a new Ducati boss for North America, the former French one; seems to me from the march 2011 issue of Moto Revue article interviewing him that the full “Ducati Store” idea needs to be improved in US of A, so that, like us in ole Europe, you can indulge yourself in more branded sunglasses and silk scarves than actual motorcycles for a full-fledged ‘ducati experience’. In the quoted article, unavailable on-line, he says they sold 6.000 in a 250.000 unit market in 2010 (I am assuming 250.000 total bikes sales in Mexico, USA, Canada) Ducati boasts 150 dealerships your side of the pond, total. His target is 15.000 unit/year over a 3 year period, and he is happily leaving France knowing that the 450 planned Diavels where already quite sold before touching ground here.

  • http://hellforleathermagazine.com Wes Siler

    But yeah, all the secrecy and fake numbers and just general BS is not healthy. I think that’s the point here. We WANT the industry to do well and sell more bikes, this kind of crap will not get them there.

    • Brook

      As long as the fake numbers are consistent among manufacturers. Besides, when was the last time you made a purchase decision based on a press release? Buell was jettisoned completely yet it didn’t stop people from purchasing their motorcycles (albeit at a reduced price). Let them feel good about themselves. I’ll continue to support Ducati as long as I can find service for my Multi within 100 miles from where I live.

  • http://rohorn.blogspot.com rohorn
  • Stuart

    I disagree.

    I own a small company. A 68% increase of our sales may sound like nothing to a huge global corporation in the same industry. But for my company, for me and for my employees a 68% increase over last year sales is a huge jump. A jump that will allow us achieve another level to recoup investments and invest some more on new ideas, products and services.

    So don’t be so cynical. A 68% increase is a 68% percent well deserved as long as it is an increase from any previous year-to-date or prior quarter reagrdless of being just an extra $100,000 or $10,000,0000.

    • http://hellforleathermagazine.com Wes Siler

      I own a small business too. But I don’t try to tell Grant that we’re earning more money when we’re simply doing less badly than three years ago. Although he’d probably believe me.

      • http://hellforleathermagazine.com Wes Siler

        Oh, and that’s in relation to duc’s performance, we’re doing well ;)

        • Stuart

          Another thing to consider is that is way easier for us small businesses (including Ducati) to achieve high percentage growth numbers in quarter-to-quarter and year-to-year periods. As companies get bigger (let’s say Yamaha) the growth percentage shrinks to even single digits where growth gets harder and harder to achieve.

          So if we put it in proper perspective Ducati’s 68% growth is very possible. Even in a horrible economy my company has been able to growth a steady 38% – 42% year-to-year since 2003.

          • http://hellforleathermagazine.com Wes Siler

            Oh, I’m sure they totally saw a 68% increase. The point is that “68%” sounds like a lot, “a couple hundred bikes extra” doesn’t. I’m not trying to rain on Ducati’s parade, simply point out that this is a case of a managed message being pushed to the public without any thought from soooo many publications.

  • Ben

    Why Ducati is playing this game? If it is a private company its not like posting meaningless figures is going to hype up their investors like H-D tries to do. I don’t get it.

  • http://twitter.com/hagus Luke

    Despite paltry unit sales, Ducati manages to run a MotoGP team, develop new models, partially pay for Valentino Rossi, etc.

    What this tells me is that one of two things are happening:

    1) Ducati is burning cash or going into debt by making big marketing gambits designed to drive sales. The Diavel and signing Valentino?

    2) Ducati has excellent margins and a small amount of sell through more than compensates.

    If it’s 2) then a 68% increase in your very high margin products is actually a big deal, even if it’s not an all time high or the unit count is low.

    If it’s 1) then the 68% increase in bugger-all is indeed a smokescreen.

    It’s hard to jump to conclusions without an actual P&L sheet. I’m inclined to give Ducati the benefit of the doubt, but this *is* Italy we’re talking about …

    • dux

      Or…
      3) Ducati has invested in part time money laundering. In which case, I’m all for it!

    • http://hellforleathermagazine.com Wes Siler

      It’s high margins at a reasonable volume. That 40,000 bikes a year isn’t $4,000 bikes, it’s $10-20k bikes.

  • Steve

    With the recent state of the economy there’s nothing wrong with announcing some positivity. With the financial black hole that almost everyone has experienced in the last few years its nice to hear. I appreciate the perspective but it comes across with a certain level mean spirit. As a small business owner I’ll take a 68% growth on the previous year’s same quarter and spread the word.

    • Stuart

      I am glad us business owners agree. A 68% growth even if it only means $5K over any previous quarter, month or year is great.

      • http://cynic13th.livejournal.com/ cynic

        I’m with you both, as a small business manager, my employees and owners like to hear some positive news.

        I normally point out that we were against weak numbers, but still it’s nice to hear that we’re doing better.

  • ktaisa

    does ducati consider a model sold when it gets driven off the dealership by new owner or when the dealership receives the bike for inventory?

    GM does this by reporting huge sale increases however dealership inventory is at record highs. all they are doing is forcing dealers to receive more inventory which is then “sold” as far as GM is concerned

    • slowtire

      +1 A lot of manufacturers of various products count in stock orders by dealers as sales and include them in their numbers.

    • austin_2ride

      Ducati says, “The retail sales mentioned are DMV registered units out on the road with customers.”

      I work at a multi line european dealer that includes Ducati. Sales are up all around, with the exception of scooters (sales off since ’08) hopefully with gas prices up they will start moving as well. Assuming people will have the money to buy them of course!

  • Trev

    To kind of quote Fargo: you’re a damn liar, Ducati; A….. fuckin’ liar.

  • stabmaster

    i dont know but i see alot of new ducati’s in southern california.

    • Stuart

      Yes! And I am glad you don’t see many of them on Mulholland Hwy. I dislike the classless pricks that ride that canyon.

  • AHA

    Truth and motorcycle marketing are strangers so it’s great that HFL is trying to change things a bit. Not the first journos to try but more publications would follow if they sense their readership want better editorial standards. So if we ask, we’ll get. If we’re happy with guff, we’ll continue to only get that instead. Sales figures are pretty harmless chest beating but accurate, for instance, bhp outputs are important trading standards. Damn, we could even get mpg figures too, if we just show we care. And published & accurate mpg figures would probably shame the mfrs into actually improving them. Hence Truth is a virtue..

  • HammSammich

    I really appreciate HFL’s focus on quality journalism, and it’s nice to get away from the standard, regurgitated press release that’s so prevalent in online media. Reading the first few paragraphs above, reminded me of an interview I heard recently (I think it was with Nick Davies, but I could be wrong) talking about “churnalism” and the website created by the Media Standards Trust to help combat it, Churnalism.com. I’m proud to support HFL, particularly because you are out there finding stories and developing your own work, rather than just republishing stories that bike manufacturers feed you. Keep up the good work – hopefully someday your brand of journalism won’t be so rare…

  • CG

    Chrysler announced a 31% Q1 to Q1 sales increase, so a better way to put Duc’s achievement is softer quarter to more reasonable quarter sales gain. In other words, Q1 2010 was pretty sucky (technical finance word) for a lot of companies. While I am not a potential Duc customer (not their fault) at least they are coming out with new models, unlike, say, Suzuki*. What Duc could do, to prove they are really accomplishing something, is prove increased market share. I am reasonably sure that one of their finance guys could peruse the Q1 reports of their major competitors to come up with some numbers. Actually, they do know that number, but since they chose not to highlightit, it must not be anything special. Hmmmmm.

    *I guess their new 600 is all new, but since it looks exactly like what they have produced for the last 10 years, who cares?

    • http://hellforleathermagazine.com Wes Siler

      In the case of the “all new” GSX-R, the “all new” is again, marketing speak that’s been repeated without thought. It’s the same as the last generation with a few new components spec’d to reduce weight and different brake calipers. Same tooling, it’s a facelift, and a minor one at that.

  • Taco

    I kinda wish it was 69 percent increase. (that would have been funny)

  • Core

    This is just curiosity… technically, couldn’t a motorcycle company sale the same amount of bikes this time around, the same amount they sold last year, but do to inflation.. parts going up in price, so the bike price being higher, they’d have higher sales vs last year?

    Anyways, interesting article.

    • Kirill

      No, because “sales” tracks the number of bikes they sold, so their sales performance would be flat. All things involving money are accounting voodoo that can be massaged to show just about anything.

  • Dan

    Re: the comment about motorcycle mags giving always-sunny reviews to ensure a constant supply of free gear and bikes from manufacturers.

    I have no doubt thats true, which makes me wonder – have any moto publications (or blogs, etc.) ever used the “Consumer Reports” model, where they flatly refuse to accept freebies (test models) and advertising from the manufacturers they test? If CR wants to test a TV, they just go buy one from a retail source. Doing it that way certainly helps to show a magazine’s independence, although it unfortunately also makes it far more expensive to publish.

    • http://www.facebook.com/beastincarnate BeastIncarnate

      Motorcycle Consumer News, as best I’m aware. At the least, there is no advertising and I’ve seen them very willing to criticize bikes. Samples of their writing are on the website mcnews.com.

      • http://hellforleathermagazine.com Wes Siler

        Motorcycle Consumer News is hardly Consumer Reports. They talk a big talk, but still play the access game and are still of the fellatio culture.

        No one’s done it because Consumer Reports is INCREDIBLY OMG EXPENSIVE to produce and there’s not enough interest in bike content to justify the expense.

        • http://www.facebook.com/beastincarnate BeastIncarnate

          True. Even still, of the US magazines available, theirs is the closest to honest. Saying that may be comparing shit to shit with sprinkles, but if those are the only choices then I’ll take the sprinkles.

          • http://www.facebook.com/beastincarnate BeastIncarnate

            I would edit the last message, but it’s not allowing me. I subscribed to Motorcycle Consumer News for a few years but cancelled a year ago. Recent issues of other mags have made me nostalgic for the “better than worthless” reviews.

    • Gregory

      I read Motorcycle Consumer News (MCN) and Minnesota Motorcycle Monthly (MMM). And Hell For Leather (HFL), of course.

      Those first two are very decent publications. I highly recommend them both.

      I also receive that crummy glossy pretty AMA magazine. It gets binned immediately. It’s a useless read. Yes, I’m a member of AMA; not out of any political or lobbying belief, but because it gets me three free tow-truck tows per year (10 miles max.), anywhere in Canada or the US, when/ if I break down. I’ve actually used it once, too.

      I also read the Aerostich catalogue, but I don’t think that’s considered a magazine.

      -gceaves
      Portland, OR
      2008 KLR 650 w. milkcrate

  • zato1414

    If they are still in business, expanding new and old model designs, maintaining production and supporting race teams… good for them and good for us!

    One more machine sold than last year is a positive, especially when our great messiah wants us to ride bicycles and horse buggies. Hey, that could be a new industry… shoveling shit up and down I-5!

    How about some updated info regarding this ethanol BS and my motors?