Too Many Questions

admin

These are interesting times — the end of one year, the beginning of another. But will '07 be another record year for motorcycle sales? Not likely. Downward pressures on sales have finally spilled over and put just about every segment in the red. How much red ink? That's a big question!

• Motorcycle sales last year were up barely above 1 percent, but our forecast for this year is down about 2 percent, which may be too optimistic. Still, because we are hearing heavy rumbles from the field, we felt our forecast needed to be adjusted. Last year cruisers were down 1.09 percent, and we had hoped that this was just a modest adjustment. Now we don't think so. Our cruiser forecast this year is also down by 7 percent.

• Let's not wade through statistics one fraction of a percentage after another, but rather ask these questions: What are the pressures behind these negative sales? With baby boomers, it's not how many boomers there are, but how many there are at the right age. It's a matter not of too many new bikes on dealers' floors, but of too many used models of the right type being sold between individuals. It's not a question of the availability of the most popular model types, but the fact that there are both too many new units and, for the first time in 20 years, too many used units of the most popular model type in history!

• Finally, there is the question of the influence of the Chinese OEMs, which have managed to bring about an anomaly in motorcycle sales volume. There's no Chinese MIC, and that means there's no organization to develop standards with its Chinese members.

• When Honda arrived in the States, the talk was the same: "Here come the Japanese. Won't this wreck the industry?" Of course it didn't, but many then weren't so sure. Currently, Honda is the No. 1 maker of motorcycles and ATVs in the United States, and most of its vehicles are made here, as are all of the other Japanese makes. But will the Chinese adopt their lead? They've shown little interest.

• On our lead question: Will our first forecast of the year hold? I would like to say so, but doubts are running high. The April issue will bring a surprise!

Interpreting This Index

Index is based on the author's analysis of the MIC Retail Sales Report, SEC filings of quarterly and annual reports, and other information provided by publicly traded companies (such as Harley-Davidson and Polaris). Readers are cautioned that these estimates are subject to error, which can result from changes in seasonal patterns due to unexpected weather conditions and fluctuations in the economy. Interruptions in the supply of popular models can also affect these forecasts. Questions concerning this Index should be addressed to the author, c/o Dealernews, or the author via e-mail at djb-llc@cox.net. Copyright © 2007 DJB Associates LLC, All Rights Reserved.