Motorcycle Sales On The Rise

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Motorcycle Sales On The Rise

It may not be everyone’s choice in motorcycles, but Harley-Davidson has reported some pretty encouraging financial results for 2013 this week and the company says it’s optimistic for even better figures in 2014.

In 2013, Harley-Davidson dealers sold 260,839 motorcycles worldwide compared to 249,849 the previous year. The U.S market, where two thirds of all its bikes are sold, was up 4.4%, while Latin America 13.1% and Asia Pacific at 9.8% reported the biggest area of growth for the company year on year. H-D is also forecasting selling up to 81,000 motorcycles in the first quarter of 2014, another increase over the 75,222 it actually sold in the same period last year.

These results from Harley come close on the heels of other motorcycle manufacturers reporting they too are starting to see some confidence returning among consumers and motorcycles starting to sell well again here in the U.S.

Harley-Davidson

Photo by Bob Mical

But remember back in the mid 2000s when the housing bubble burst? H-D was making around 350,000 bikes a year in 2006. Then the economy along with almost everything else went to hell in a hand basket.  Sales of all motorcycles, which are seen by many as a discretionary spend rather than a necessity, tumbled along with the broader economy.

It finally bottomed out in 2010 when H-D shipped 210,494 bikes to its dealers, which was some 40 percent fewer than four years previously. Clearly something needed to be done and quickly.

So what happened was that H-D’s management seized the initiative and went to work. On the face of it, it looked highly likely that they might not actually be able to turn the ship around. First thing to go was the Buell brand followed by MV Agusta. Then the implementation of an ambitious restructuring program that saw it finally come to an agreement with wage concessions with its union workers at its facilities in Milwaukee, Kansa City and York. This and a flexible working program that allowed the company to ramp up production saved the company $310 million alone in 2013.

Harley-Davidson also made money last year. Their net income was $734 million on consolidated revenue of $5.90 billion, compared to $623.9 million on consolidated revenue of $5.58 billion in 2012. Included in the 2013 revenue figure is the $873.1 million it generated by distributing parts and accessories.

2014 Harley-Davidson Street
2014 Harley-Davidson Street

Why should you care if Harley-Davidson is doing well? Well aside from creating manufacturing and retail jobs and supporting the U.S. economy, if Harley-Davidson is doing well it’s a reflection that people are spending money again on non-essential items like motorcycles.

That confidence has a knock on effect for the rest of the industry here in the U.S. where H-D ultimately is the biggest player.

But it’s not just good news coming out of Milwaukee. BMW and Honda are significant industry stalwarts around the world and in the U.S each reported big sales improvements in 2013.

Honda sold 16.8 million motorcycles globally last year up 8.7% from the 15.5 million in 2012. However, its performance in Japan and Europe was still down year on year, with biggest increases in China and Asia providing 1.35 million sales. North America was also up to 278,000 in 2013 compared to 264,000 in 2012.

BMW Motorrad USA reported a 17 percent increase in sales for 2013 – its second highest retail performance on record – with 14,100 bikes sold in 2013 compared to 12,100 units sold in 2012. Worldwide, BMW Motorrad sales reached a record high for the third year in a row with 115,191 sales up 8.3% over the previous record of 106,358 sales in 2012.

Ultimately this is all good news for every single one of us that rides and likes motorcycles. While the motorcycle industry as a whole has not quite turned the corner just yet, there are some encouraging signs that the global economic slump we’ve all just been through may finally be coming to an end.

  • socalutilityrider

    Timely article. An acquaintance of mine named Larry just yesterday got a sales job at the SD Harley dealership-they’re hiring again. There are so many things I wanted to say to him about HD’s, pirates, and posing, but I just let it go. Like the article says, more people buying more bikes is good for the industry as a whole, good for us, and hopefully good for Larry. I can’t wait to hear the customer stories.

    • Piglet2010

      Arrghhhhh…

  • keyle

    Any figures on Buell before it got the sack?

    I own a lightning and I still can’t understand why such awesome bikes got chopped.

    • Piglet2010

      BRP* offered to by Buell, but H-D management decided it was more important to screw Eric Buell that to do their stockholders a favor.

      *Who owns Rotax, who made the Buell Helicon engine.

    • WheelieGood13

      They weren’t always that awesome. -Former ’00 Buell Owner

  • zion

    Always good for all of us when there are more seats in the saddles.

  • E Brown

    The impact on the US market should be minimal. China and India are the fastest growing markets, so I’d expect new development to target them, which means small displacement bikes, and no one tries to sell those here anymore.

    • Stuki

      They will.
      With motorized transportation becoming ever more prevalent in China and India, and incomes rising; the “smaller displacement bikes” all those people will want to buy, will be less obviously “inferior” by western standards. So much so, that they will be importable and sellable here, and with OK quality. And with stagnant incomes in the west, more than a few over here will take a second look at the then improved bikes. The rush of the big names to manufacture in India and Thailand, is only the beginning of a huge wave that will be crashing on our shores faster than many expect.

      • nick2ny

        Yup.

      • HammSammich

        Spot on…

      • Piglet2010

        Hero (a major investor in EBR) will soon be selling under their own name in the US.

    • runnermatt

      You are correct about China and India being the fastest growing markets and that development will target them, but I’m not so sure about your small displacement bikes theory. Not sure if you saw the article from Ride Apart titled “Why Your Next Bike May Come From India” (link at bottom just in case), but increasing incomes in India means more people are looking for +500cc bikes. Rather than write a longer comment here is the link to the story.

      http://rideapart.com/2014/01/why-your-next-bike-may-come-from-india/

      • E Brown

        I agree with the article that displacements will increase in the East, but that alone won’t close the gap. What will happen is India, China, and other growing markets will develop towards resembling the European market rather than North America, getting the bikes we already don’t get. This will happen because the core difference between North America and all other markets is that bikes here are recreation instead of transportation (and because they’re still developing their road systems, I see ~500cc – 750cc dual-sports as the wave of the future). They’ll get some bigger bikes, but not the sportbikes, superbikes cruisers and muscle bikes that sell here. It will be interesting to see what unfolds.

        • runnermatt

          You make a very good point about their road systems and that the will more likely get the bigger dual sports. That said I could see the ADV bikes being big there too. Great points!

  • Roger Sho Gehrmann

    It’s interesting how a motorcycle is seen as a non-essential item in the US/west. In Japan a increase in motorcycle sales is often used as a indicator to show a downturn in the economy – as young people choose a cheaper mode of transport over a car.

    • ThinkingInImages

      Until recently the U.S. had very few motorcycles anyone would buy as a daily ride. Primarily we had big cruisers, super sports, old and old tech feeble models, and scooters. They were pretty much luxury/hobby things.

      • Piglet2010

        No, a scooter is a more sensible choice than a standard motorcycle for practical transportation.

        And the reason that very few motorcycles that would be useful for a daily ride were for sale in the US is that almost no one bought them in the past when the manufacturers tried to sell them – the market has been poisoned by biker and squid culture.

        • Stuki

          Don’t forget laws and lawyers; As always, the root of all evil. If you’re going to be stuck sucking smog between soot spewing diesel dullys for hours on end, and have to abide by every silly rule our supposedly so great Demooooocracieeee of dully drivers manage to come up with, it’s hardly irrational to simply join the cage-apes.

          When in Rome, do as the Romans, right? And when on a sheep farm, do as the rest of the sheep. Lest the rest of them excercise their “democratic freedoms” and label you a terrorist.

          In freer places, you ride, drive and park where your vehicle can go; which results in people choosing more suitably sized vehicles for crowded environments. At least people with brains do.

        • Stuki

          In most of the US, practical transportation devices need to remain at least marginally practical on freeways. Which are built of concrete slabs resulting in consistent bumps that require 5 inches of well dampened suspension travel to navigate in comfort. Scooters just don’t have that. They’re OK for local riding around town and to the grocery store, though. Just don’t expect to jump kerbs like a dual sport.

          • Piglet2010

            The real problem with scooters is cheap damping rod forks and shocks – proper suspension with high and low speed damping circuits would work wonders for freeway riding.

            Funny thing is a few people have asked if my Honda Deauville is a scooter – no, but it does have a great ride over slab-faulted pavement. And all that locking storage makes it a very practical commuter. No wonder only 17 people* in the US bought one.

            * I exaggerate, but only slightly.

          • ThinkingInImages

            I agree with you on scooters. For some people it’s the best answer. Street traffic can be miserable when you have to shift manually.

            Few motorcycles have 5″ of well dampened suspension – maybe off road motorcycles do. I doubt cars do. I think the rules of irony would apply if they did. For every vehicle with 5″ of suspension travel a 6″ deep hole would open up to negate it.

            I thought the Deauville was an elegantly styled motorcycle in need of an update. The CTX isn’t it.

    • JP

      Hah, that’s a good observation, I’ve never thought about that.

    • gaudette

      This explains everything.

      • Literdude

        Do you think they don’t have snow in Japan?

        • gaudette

          Alight, weather and population density.explains everything. Even a few days of cold makes motorcycles unpractical.and having to drive more than a few miles to get anywhere makes motorcycles a non-essential item no matter how cheap.

          • Stuki

            Cold is not that big a deal with modern clothing and suitable bikes. Snow and ice is a bit of an issue, but a couple of days out of the year? Take the car (which can be a cheap beater if you have a bike most of the time) if you really have to. Or take a bus if available. Or carpool. Or stay home.

            And, Northern Japan is pretty close to being THE single snowiest place on the planet.

  • Dubknot

    “Non-essential”?!! This is really great news. More bikes on the road = more rider awareness. Hopefully.

  • ThinkingInImages

    I can understand the increase in Honda sales in the U.S. They didn’t have any all new models for years. Odd things like the DN-01 didn’t help. The CBR250R did.

    • HoldenL

      Yes. And let’s see how Honda’s sales fare in the first full year of the CB500 series. I hope Honda is richly rewarded. Also, I want to buy a Grom this year.

      • ThinkingInImages

        For years, going to a motorcycle dealer or show was like going to a museum. Little changed but paint color, stripes and plastic.

        If motorcycle makers want to attract new riders and new motorcycle business, they have to make approachable motorcycles for new riders. Apparently scooters are doing well, judging by the amount of them I see around here. That’s nice. The only thing that puts me off about scooters is the tiny wheels (and these ragged roads) and the “too cute” styling.

  • HammSammich

    If I recall correctly, a few years back Triumph eclipsed BMW in market share, but it’s been a while since I’ve followed the business side of the industry so I’m not sure where they stand now. At the time, I chalked it up to the fact that BMW had kind of backed themselves into a similar corner of the market as Harley with their product line – high priced, primarily for Boomers w/ money or home-equity and inferior/expensive products for newer riders.
    When I saw the pricing of the RNineT at just under $15k, I was concerned that they were sticking with a losing strategy. But given their sales, maybe it’s not such a losing strategy after all?

    • HammSammich

      To be clear, when I say “inferior/expensive products for newer riders” I’m not claiming that BMW doesn’t make great bikes, I’m just pointing out that the smaller displacement BMW’s (650′s and 800′s) are not as good as available alternatives – especially for the price.

    • Literdude

      Actually, no. In 2012, Triumph sold 49,000 new motorcycles, and BMW 106,000. In 2013, Triumph sold 52,000, and BMW 115,000. BMW is twice as big, and growing more quickly.

      As for whether BMW has “backed themselves into a corner”, I don’t think they would call it that. They’re a luxury automaker. The cheapest BMW car I can buy in this country is just under $35,000 (before taxes). I doubt anyone at BMW thinks this is a problem. The CBR250 is not trying to compete up with the R90T (just like the Fit is not the same market as the 3 Series), so why should BMW try to compete down with them?

  • atomicalex

    Holy cow! Honda’s bike group is ten times bigger in volume than PSA-Citroën! Yikes!