OCC Takes On the Network

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When news came down that the Teutuls were adding a line of limited-edition production bikes and a dealer network to their Orange County Choppers empire, the average industry wonk couldn't help but raise an eyebrow. Were they celebrities or bike builders? Both? Even the Teutuls recognize there may be a hump of perception to get over.

"We're basically trying to separate the talent from the bike-building part of it, the production part. It's basically two different things. We don't want to get the two confused, and I think that's happened in the past," Paul Sr. tells Dealernews. "People get confused whether we're entertainers or we're bike builders. Basically we are both."

The company jumped into the small-volume production game with four models unveiled in late July at its facility in Montgomery, N.Y. Nearby in Newburgh, N.Y., a new 92,000 sq. ft. manufacturing site will serve as headquarters, showroom and sound stage for the American Chopper series.

Given that production bikes and one-off customs are two entirely different animals, OCC eased into its new business model by heavily researching the marketplace. The company hired market research and PR firm Velocity Inc. to determine just how Orange County Choppers is perceived inside and outside the industry.

The firm surveyed distributors, representatives, dealers, riders and fans to get their thoughts on OCC. The results, the company says, helped it gauge the market climate for a new bike line, and helped it suss out a planned branded hard parts line.

Paul Sr. adds he'll also tap into his knowledge of production and manufacturing he gleaned from the steel fab business.

Additionally, the experience (and money) afforded by having a hit TV show has allowed OCC to acquire specialty manufacturing equipment and undertake R&D that ventures into the outer limits of motorcycle design.

But will all of this help cushion a heavy landing in a soft custom bike market? Pauls senior and junior say the company has entered into this venture cautiously but with an eye toward success.

"We're going to let it climb naturally; we're not going to try to oversaturate the market or get in over our heads," says Paul Jr. "We're just going to pace it out and do everything right the first time.

"We're fully aware how soft the market is right now. You can see sales are down across the board with most companies," Paulie adds. "Fortunately for us, with the other part of our business, that soft market doesn't affect us tremendously because we're doing different things for corporations."

Currently the shop builds about 120 custom bikes a year for corporate clients and others. OCC will be building another 50 or 60 of the limited-edition models.

The new line ranges from the Greenie bobber to the Web, a spider-themed chopper. The SplitBack is the company's flagship chopper, featuring a 40-degree rake and 240mm rear tire. The T-Rex Softail chopper also sports a 240mm rear.

Priced to compete with Big Bear Choppers, Big Dog and American IronHorse, OCC's bikes start at $29,900 for the Greenie, $38,900 for the T-Rex, $42,900 for the Web and $51,900 for the SplitBack.

The bikes feature S&S Cycle motors , Harley-Davidson, Baker transmissions, RoadLoK security devices, Vance & Hines pipes, Danny Gray seats, and parts from Arlen Ness, Moon Eyes and other makers of high-grade pieces. A H-D color-coded wiring harnesses for easier service, adds Paul Jr. "We're trying to make things universal where anybody can work on these bikes."

The company wants to establish 12 to 15 dealerships through the end of 2007, with more expected in 2008. It's looking for established, upscale dealerships — stand-alone and multiline. Dealers can apply for a franchise through the OCC website.

At the unveiling in July, the company displayed a model showroom featuring bike display stands, an interactive video kiosk, and merchandising fixtures. Following the successful lead of big OEMs, OCC is aiming for dealers to create a store-within-a-store space inside their showrooms.

Dealers who want to buy in at the base cost of $40,000 will need to have a minimum of 600 sq. ft. available for the OCC display and maintain $10,000 of retail merchandise in stock.

A highlight of the store within a store is the kiosk, an electronic showroom that allows customers to buy any of the company's gear or memorabilia through a computer terminal.

A new line of riding and casual apparel is based on the limited-edition bike lineup rather than on OCC's familiar branded gear. This is part of the effort to separate the TV show and the OE manufacturing.

Dealers incentives include sales and service training and support, financing, promotions, limited warranties on every bike, marketing materials, on-site demos and a "top-down" review of the program, and inclusion on the dealer locator function. The first six dealers buying six bikes or more will get an open house at which one of the Teutuls will make an appearance.

For now the Teutuls say they'll use their same staff for building the production bikes but will increase it as needed. The main thing is to make sure everything is in place for the franchise so things proceed smoothly, explains Paul Sr.

As the custom bike scene continues on its teetering course, OCC is setting out to further influence the market with its new manufacturing angle.

"Our goal now is to be more involved in the industry. I think that this will also help it once we become more involved in it," says Paul Jr.