KYMCO's Bondy: U.S. expansion to be fueled by dealer network

There was a moment not too long ago when it looked like the myriad of new brands from China and elsewhere would become mainstream forces in the U.S. powersports market. The industry still was centered on the Big Four and other major players, but other brands were everywhere.

Fast-forward through the onset of the Great Recession, and many of these brands have disappeared. KYMCO hasn’t suffered that fate and, in fact, seems more committed to the U.S. market than ever with an expanded model line and a focus on supporting the dealer network.

KYMCO USA unveiled its 2012 model ATVs and scooters to Dealernews and other motojournalists on a KYMCO-sponsored ride that took place in April in South Carolina. Whether we were bouncing through the mud north of Columbia or bopping around the streets of Charlestown, the new KYMCOs were consistently impressive, highlighted by the new high-tech 450 quads and the 300cc Downtown and People GTi scooters.

For our review of KYMCO's MXU 450i and sport Maxxer 450i quads, click here.

For our review of KYMCO's 2012 scooter lineup, click here.

KYMCO USA’s sales are nearly evenly divided between ATVs and scooters. The ATV business continues to be a struggle; however, rising gas prices have caused “an influx of more prospects” on the scooter side of things, says Eric Bondy, president and CEO. KYMCO also includes entry-level and high-end offerings to further entice prospective scooterists.

“We were impacted pretty heavily by the CPSIA and the lead law because a lot of our business was youth quads,” Bondy says. “Our model mix is moving more and more toward larger displacement bikes now. We run the gamut from the entry-level guys all the way up to the high-end guys with the Xcitings and the Downtowns.”

KYMCO USA  is now wholly owned by parent company KYMCO Taiwan — sending a message, Bondy says, that the company plans to be around for a long time. “For dealers, for customers, they can feel confident that they’re dealing with a reputable company that’s going to be here for them,” he notes.

KYMCO Taiwan has made a significant financial commitment to its U.S. subsidiary — to the tune of eight figures since February, Bondy says. “[This] has really strengthened the balance sheet and made us a much more financially stable company,” he explains. “It also allows us to invest in those things that we think are so critical to growing our brand.

"This is a completely different business model for KYMCO Taiwan here in the U.S. In the majority of countries they do business in, they don’t own their distributor and don’t need to. But the U.S., it’s different in that the Big Four Japanese and the two domestics are basically dealer-direct. And in order to compete, KYMCO recognized that this was the right choice,” he continues.

Part of that investment will be put toward growing the brand among U.S. dealers and consumers. Bondy says KYMCO has around 670 to 674 dealers.

“We’re pretty pleased with the overall performance of our dealers. But we still have a big brand awareness gap to overcome,” Bondy says.

“I think we’ve done a good job over the last eight to 10 years of educating the industry, but we still have a big brand-awareness gap with consumers," he continues. "If you go to most consumers and say you’re with KYMCO, they’ll either not know who you are, or lump you with some of the other Chinese companies. So we almost have a double hurdle that we have to get over.

"There’s a negative connotation of products that are coming in from Mainland China, so we get grouped into that and, at the same time, we have this sometimes-unrecognizable brand," he says. "When we talk to customers, we have to start with the basics: manufacturing, where they’re built, the warranty.”

Bondy stresses what he believes is KYMCO USA’s greatest strength and the force that will continue to push it forward: its dealer network. “The dealer network is the biggest difference, the biggest selling point,” he says. “That’s why KYMCO has stayed, whereas a lot of companies that were here aren’t around anymore. It really is the dealers, and the efforts they’ve put in growing the brand, growing their customer base.

"For us, and I honestly believe this, when you look four to five years ago at all the brands in the marketplace that aren’t here anymore, the difference is distribution, it’s dealers," he says. "We’re extremely thankful for the dealer network that we’ve had.”

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