I RETURNED FROM visiting the Chinese Motorcycle Trade Show (CIMA) on a Friday. The following Wednesday I attended the MIC’s 14th Annual “Inroads to the Future” conference. Every year “Inroads” features a speaker addressing the state and probable economic future of the nation and how that might relate to the motorcycle industry. This year the roster also included author David Nour, who talked about new sales and communications strategies and connecting with customers. Included in his comments was a suggestion for persuading young consumers to adopt two-wheels as utilitarian transportation.
At this point you’re probably asking yourself, What does a Chinese trade show have to do with “Inroads to the Future?” Well, the Chinese have problems similar to ours: a declining market (though nowhere near as severe) and a reluctance of younger people to buy into the two-wheel world. Sound familiar?
|All of the sales and marketing techniques that made The Motor Co. a success in the U.S. are being replicated in China.|
In the United States a lot of people think our industry’s salvation lies in more people adopting the motorcycle as a transportation device — and there are a lot of logical reasons to do so. But the Chinese industry sees its salvation as getting more people to develop an affinity for the lifestyle.
I think the Chinese are on the correct course to solve or at least mitigate their problem. They’ve got an expanding middle class (larger than that in the U.S.) and rising economic growth that’s lifting everyone’s boat. The downside of this is that while previous generations grew up with motorcycles as their prime transport, many of the population born in the 1980s and ‘90s have never owned one; rather, the aspirational vehicle for most Chinese is a car. Their problem is how to create an image for motorcycling that will move it away from a basic utilitarian vehicle to an object of desire.
Oddly enough, Harley-Davidson is leading the way. Harley now has around 10 dealers in China and just opened a new store in Chongqing. All of the sales and marketing techniques that made The Motor Co. a success in the U.S. are being replicated in China, and this has caught the eyes of several motorcycle manufacturers there. But Harley’s success also has caught the attention of other manufacturers of large displacement motorcycles, notably Victory, Ducati and BMW, all of whom have plans to exploit this potentially rich motorcycle market. The Chinese expect the sales of big displacement motorcycles, currently around 5,000 a year, to grow 120 percent annually over the next few years.
So while the numbers of motorcycles sold in China will probably continue to decline, the revenue of fewer large displacement motorcycles could bridge the income gap significantly.
WHY FOUR WHEELS STILL TRUMP TWO
Which brings us back to the U.S. market and Nour’s suggestion that the industry start demo days at college campuses. Not a bad idea, and it might sell a few motorcycles and scooters. The problem is that aside from some small displacement two-wheelers, most motorcycles are pretty impractical for everyday transportation.
First of all, there’s the weather. I went to college in the Upper Midwest during one of motorcycling’s heydays. You’d see guys riding their bikes in the fall, the numbers dwindling until November, after which you didn’t see any except for the ones that were parked outside with a coating of ice and snow, deteriorating while they waited for spring. (continued)