DEMOGRAPHICS are No. 1 when it comes to understanding where the industry is likely to be headed.
For example, Harley-Davidson and the baby boomers unknowingly decided to start helping each other starting in 1982, and by 1995 H-D owned about 25 percent of the overall motorcycle market. By 1997 it owned an estimated 29 percent. But with current developments the No. 1 company seems somewhat more vulnerable than before.
Still, we forecast H-D to sell an estimated 268,000 units this year, which would equate to a 0.14 percent share of the U.S. population aged 18 to 64 — all 198 million of them.
When considering percentages and demographics, one of the most important elements relates to splitting age groups. Say you are trying to forecast a particular category that's targeted for a customer base 35 to 64, a demographic that's growing each year and is relatively easy to track. Someone looking at this with a jaundiced eye might well miss the fact that populations aged 35 to 54 can be sandwiched into the age group 35 to 64 and thereby get lost. This becomes a problem because of the way the Census Bureau reports statistics. But this also shows how easy it is to error when trying to determine the direction of sales and whether they will increase or decline.
Now a quick summary of our motorcycle forecast for 2007:
- We forecast the street segment will produce about 661,000 units, down 3 percent.
- There has been a renewed interest in the dual-sport segment, but it should still be down about 2 percent at 34,500 units.
- The off-highway segment reflects Chinese imports, most of which remain unreported. Our forecast for this segment is 239,000 units (reported), down about 5 percent.
- Finally, ATVs: Last year ATV sales were approximately 748,000 — about even with '05. This year we expect sales of about 693,000 units, down 7 percent.
There's a lot going on, so call this a period of correction — a period that may go on for a while, so continue to watch this space.