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Archive for the ‘2017 Models’ Category

Harley-Davidson CEO Meets POTUS

Earlier this year, the President met with Harley-Davidson exec’s and put a spotlight on the company in his address to Congress, yet there was no “Trump Bump” as the motor company reported earnings which included sharp declines in revenue and profit for the first quarter of the year.

Some of the key Q1’17 stats:
— $186.4 million in net income, or $1.05 per share, for the period ended March 26, down more than 25% from $250.5 million, or $1.36 a share, in the same period a year ago.
— Revenue was $1.5 billion, down from $1.75 billion in the first quarter of 2016.
— Motorcycle sales in the U.S. were down 5.7% in the quarter compared with a year ago and International sales fell 1.8%
— Reported motorcycle shipments fell 14.7% to 70,831 in Q1
— Market share in the 601cc-plus segment was up to 51.3%.  Execs stated that the Victory liquidation helped market share.

Nothing screams Americana more than deep vehicle discounts and Harley-Davidson jumped head first into that pool by offering its dealers financial incentives to clear out the leftover 2016 motorcycles.  And in an unusual move the company has purposely constrained the supply of its 2017 hottest-selling new models, including bikes with the new Milwaukee Eight engine, leaving some customers waiting to conquer the open road.  All of this is happening with only 4-months until the 2018 model-year launch.

If you listened to the earnings call this week there was a lot of “feel good” expressions from management about the way the company is performing yet, there are tepid sales, a downbeat outlook, and consumer confidence numbers that don’t reflect spending behavior.  Clearly households worldwide are slow to embrace new motorcycles as a way to enjoy life.

According to Harley-Davidson this is the 9th year in a row (based on IHS Market New Registrations) for motorcycles with 601+cc where they were the number one seller of new on-road motorcycles in the U.S. on both their “outreach” and “core” customers.  “Outreach” is defined as four segments — young adults ages 18-34, women, African Americans and Hispanics.  “Core” is defined as Caucasian men aged 35-plus.

Harley-Davidson reported that more people than ever before are discovering motorcycles and claimed that they are dominating the motorcycle market as well as being recognized as the leader in addressing key demographics — women, younger riders, African Americans and Hispanics, however, the patterns of growth remain elusive.

So whats going on?

Let’s drill down:
— Press and media continue to push negative motorcycle narratives (motorcycle crashes, distracted driving, club violence (last years Waco example) etc.).
— Increased pricing on new motorcycles have pushed out the average length of ownership.  For example new autos reached 6.5 years in Q1 2015.
— In the northwest along with parts of California the wet weather has limited the number of days to ride in 2017.
— Increasing Insurance rates  — on auto, home and health care biting into the discretionary funding of a motorcycle hobby.
— Income growth has declined.
— Interest rates have increased (in past years people pulled $$ from their house to buy a “toy” and now there is no where else to pull $$).
— Fewer “Outreach” customers (aged 18-34) own vehicles or don’t drive as much, they UBER.
— Apathy of the motorcycle hobby/life style as a form of entertainment

All or some elements of this could be weighing down new motorcycle purchases.  But I’m an optimist, and Harley-Davidson has a 10-year strategy to train 2 million new U.S. riders, grow international business to 50% of sales (currently about 32%) and launch 100 new “high-impact” motorcycles.

As it turns out and according to this report, about 22% of all new motorcycle purchases come from first-time buyers. This figure has remained relatively stable since 2001.  It’s very likely some of those 2M new riders will buy a new “high-impact” Harley.

Photos courtesy of CNBC and Harley-Davidson

Full Disclosure:  I don’t currently hold or intend to hold any $HOG shares.

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2017 Indian Chieftain Elite

The marketing guru’s claim that Indian is authentic, was born with a dedication for pure performance and now are adding even more capability.

First a bit of history — the first Indian Motorcycle was sold to a retail customer back in 1902, but I’ll spare you a 100+ year recap of the motorcycle.  In modern day history, the Indian Motorcycle brand has been part of Polaris Industries since 2011, and began selling new motorcycles in 2014. The motorcycles are American made and built in Spirit Lake, Iowa.  The are distributed via 200 dealers across North America and nearly 450 dealers globally.  You might recall that the Victory Motorcycle brand, was recently shuttered by Polaris and ceased production.  To the dismay of many, many satisfied customers, it is now winding down operations after 15 years on the market leaving Indian as the only mass-produced American motorcycle brand other than Harley-Davidson.

2017 Indian Chieftain Limited

Jump ahead to April 2017 and we learn that Indian has announced expansion of its Chieftain model lineup with the addition of the Chieftain Limited and Chieftain Elite.  If you’re keeping track this brings the total number of 2017 Indian models to twelve.

It should be noted that the Chieftain was one of the first three bikes that Indian released in 2014, along with the Chief Classic and Chief Vintage.  Although model details differ, the bikes share a common platform — engine, transmission and chassis.

All three motorcycles come with Indian’s proprietary Thunder Stroke 111 V-Twin engine, cast aluminum frame with integrated airbox, air-adjustable single rear shock and many other shared mechanical features.  As it turns out, the Chieftain was the modern-looking of the three, showcasing a unique fork-mounted hard fairing which housed its gauges and electronics, while the Chief motorcycles came with accessory windscreens.

2017 Indian Chieftain Dash

The newly announced Chieftain Limited imitates some details from the custom bagger scene.  It has a skinny 19-inch front wheel replacing the 16-inch front. The “old-school” valanced front fender has been chopped to follow the design line of the wheel and exposes the mag wheel and oversized dual front brake rotors. There is a sleeker seat design, and the headlight bezel is painted, not chromed, to match the Thunder Black paint scheme.  The remaining elements of the Chieftain Limited match the Chieftain feature-for-feature, including the 7-inch touchscreen-operated Ride Command Infotainment/Navigation system and hard saddlebags.

For the well-heeled enthusiasts familiar with and looking at a Harley-Davidson CVO (Custom Vehicle Operations) motorcycle, you’ll appreciate the new Chieftain Elite. Let’s start with the 12-layer paint treatment which is built on a foundation of gold paint. Black accents are added with marble textures, and the bodywork is coated with layers of Fireglow Red Candy clear.  Yeah, it’s a looker with a stunning paintjob, thanks in part to that brilliant red candy color.  Some of you would drop a lot of money with a custom painter to achieve this look, but this one comes direct from the factory.  In addition, the Chieftain Elite gets billet floorboards, a flip windscreen, Pathfinder LED headlights and a 100-watt saddlebag audio system.

At first blush the Chieftain Elite is a factory custom that will hold its own against Harley-Davidson CVO’s.  As to price?  The new Chieftain Elite (starting at $31,499) and Chieftain Limited (starting at $24,499).  Both motorcycles are feature rich, available now and aggressively priced compared to Harley-Davidson.

With warmer weather and longer days on the way, the new Indian Chieftain’s might be the spark of inspiration you’ll need to explore a wide-open two-lane world.

Photos courtesy of Polaris/Indian Motorcycles.

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BITW-HelmetAs I write this I’m reminded that I was flying home from Barcelona, Spain about this time last year after a long work week at an industry event and that every year in business is different.

A few years are easy, some are hard, and most are somewhere in between. Each year you face a different set of circumstances: changing economic, political, social and what’s cool in the billet industry.

We know from the Discovery Channel which scripted a mini-series project about the history of Harley-Davidson, that in the early years the company really struggled to survive. From month to month, they worked hard to keep from getting further behind and sinking further into debt.  There were the AMF years and then came the housing bubble.  Those of you who have tried or are establishing a little business of your own know that success is much harder than you envisioned it should be. Many folks think there must be “one big thing” they are missing that if discovered and remedied would turn things around and put them on the path to major prosperity.

Clearly, that isn’t the case, and over the course of a few startup years often you learn that rather than “one big thing,” there are many functions throughout the business that had to get established in good working order for the business to really succeed.

After 114 years, this still holds true for Harley-Davidson. There are no guarantees or shortcuts to success. There is only doing the hard work that needs to be done, doing it to the highest standards, and identifying the next area to establish or improve in order to build the next generation of Harley-Davidson rides and riders to control their destiny.

All of this became acute over the last week when Harley announced their Q4 and full-year 2016 financial results (HERE).

Words like “intense competition, flat market, soft sales, and earnings miss” ruled the day.

These are just words.  I’m of the viewpoint that how well any company performs is a key factor in how well they succeed compared to their competition.  Since we’re a few days before Super Bowl — a sports analogy is in order — how well a team executes ALL aspects of their game has everything to do with whether they win or lose.

Obviously taste in motorcycle brands, styles, or in paint schemes, is subjective. Some in the press have beaten down the overall market with reports that seem to indicate the riding “fad” has ended. Granted there’s been negative publicity with Polaris shutting down the Victory Motorcycle brand and overall motorcycle industry earnings not being great, but there are many very nice motorcycles being made, and WE the riding enthusiasts/public have lots of choices.

Why do I bring this up?

I’ve notice in my travels that many successful companies have a sense that they are masters of their own fate; their success is within their control. They know it’s a myriad of little things done well that add up to their success. And no matter what their size, they realize that a company always has the resources at hand to take their next step. Isn’t that really the “art” of it: to creatively employ existing resources to advance the ride, the employees and the company?

Most of us know the answer to a problem is rarely found outside the company; it usually comes from within.  I’m confident that Harley-Davidson will find the answers and simply function better as an organization.  I predict they will do a more thorough job of performing the functions a successful motorcycle company needs to and roll out compelling new products that will be industry hits.

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Brace

News about Harley-Davidson during the month of August has been a bit of a wild ride.

There was the consent decree and $15M settlement with the EPA. Then the announcement that Harley expanded the list of bikes on recall that may have been built with defective hydraulic clutch systems.  Then the biggest engine-product launch for the company since 1988, when the Twin Cam made its debut.

And now today, the day before the Milwaukee Rally kicks off, Harley-Davidson announced that approximately 200 employees will face layoffs starting in October as the company adjusts motorcycle production due to slower sales.

According to various news reports including Rick Barrett, of the Milwaukee Journal Sentinel, the union stated many of the layoffs will take place at Harley’s assembly plant in York, Pa., and some will occur at the engine plant in Menomonee Falls, where the company employs approximately 1,000 people, as well as in Tomahawk.

Given that the Sturgis Motorcycle Rally attendance was down roughly 40% from a year ago (some of which was expected), suggest that some riders are busy doing other things than throttling down rural America’s roads to a rally which makes the launch of its Milwaukee-Eight engine motorcycles key to amp up any new motorcycle sales.

Photo courtesy of Sturgill Simpson Video.

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UPDATED: April 24, 2017Added a tab “Engine History” on the blog home page with updated V-Twin engine history including the Milwaukee Eight.

"M-8" top view showing tubular rockers

“M-8” top view showing tubular rockers

It happens every year and often it’s big news.

This year the launch of the Harley-Davidson 2017 motorcycle line-up is anchored by the new Milwaukee-Eight™107 and Milwaukee-Eight™114 power plants.

A couple weeks ago I posted about a new eight-valve Big Twin and now we know the rumors are true.  The displacement of the standard version is 107ci (1,750cc) or in the CVO version it’s 114ci (1,870cc). The 2017 touring models get these engines first and may waterfall down to other models later in the year.  The 107 uses precision oil-cooled cylinder heads and will be in the Street Glides, Road Glides, the Electra Glide Ultra Classic, and Freewheeler trikes.  A Twin-Cooled version with liquid-cooled cylinder heads and radiators will be in the Ultra Limited models, the Road Glide Ultra, and Tri Glide models.  The CVO Limited and CVO Street Glide models will have the Twin-Cooled Milwaukee-Eight 114.

M-8: Four-valve combustion chamber and the dual spark plugs

M-8: Four-valve combustion chamber and the dual spark plugs

You might recall that the last major design evolution of the Twin Cam — and a significant part of the Project RUSHMORE and marketing campaign — was anchored on improving power plant cooling.  This took the form of circulating liquid coolant in tubes around each cylinder head’s hot exhaust valve seat and then to external radiators.  Many riders neglected to notice much in the way of decreased heat from this method of trying to get more power out of the 103.

So let’s talk details of the new eight-valve “M-8”.
ksksksksk

M-8:  Cutaway shows cooling areas of circulating liquid (Blue)

The 107 (3.937 x 4.375-inch bore and stroke) is cooled by pumping oil through it and then through a “chin radiator” ahead of the crankcase. In the 107 and 114 Twin-Cooled models (the 114 has 4.016 x 4.500-inch cylinder dimen­sions), water/antifreeze coolant is circulated through a cored heart-shaped passage that encircles the exhaust valves and then through radiators mounted forward to either side of the engine, as we’ve seen.  The new engine uses a nearly flat chamber of minimum surface area with four valves and abandons the large surface area of the traditional deep, modified hemi two-valve combustion chamber found in the old design.  The new engine operates at high compression ratios (as high as 10.5:1).  As a result, the 2017 Touring motorcycles will provide 10 percent more torque.  Harley states that will translate into two to three bike lengths faster from 0–60 mph, and one to two lengths quicker in top-gear 60–80-mph roll-ons along with improved fuel economy.

Overall airflow capacity of the “M-8” is 50 percent greater versus previous Big Twin engines, and the throttle body now has a 55mm bore.  Each cylinder has an acceleration-type knock sensor along with ECM control which protects the engine from detonation.  The new system is an improvement over the previous ion-sensing knock detection.  The exhaust components, including the catalyst, have been relocated to help move engine heat away from rider and the new engines have a single four-lobe camshaft with automatic hydraulic tensioner in place of the Twin Cam’s pair which will help reduced mechanical noise.

And in a first for the rubber-mounted Big Twin is a single counter-rotating internal balancer.  It’s meant to eliminate 75 percent of the engine’s primary shaking force.  In addition, idle rpm has been cut from 1,000 to 850 rpm all in a effort to give riders improved engine smoothness.  Other engine items of note is a new higher capacity alternator along with a new 1.6 kW (2.14 hp) starter that replaces the previous 1.2 kW (1.6 hp) units.  There is a self-torque-boosting clutch with Brembo hydraulic actuation for a lighter lever pull and the engine ECM has been changed from a mapped system to torque-based which will be interpreted as a call for a specific torque level, not a specific throttle angle.

On the motorcycle side, the front and rear suspension is new.  The new 49mm fork contains “dual bending valve fork technology” and uses cartridge-style variable-orifice damping valves, which Harley claims will deliver improved control at low speed without harshness over sharper bumps.  This wasn’t achievable with the old system of fixed damping.  Touring fork travel is 4.6 inches on standard models and 3.9 inches on low models.

After doing a quick H-D web site scan on the CVO Street Glide and CVO Limited models — it looks like the MSRP price went up $1K from 2016 ($36,799) to 2017 ($37,799).  The same $1K increase is also shown for the CVO Limited ($39,999 to $40,999).

Only you can decide if the new 117 engine, the new suspension along with the radio power adjustment warrants the price increase.

Photos courtesy of H-D.  Engine detail/stats courtesy of Cycle World.

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H-D new engine -- “Milwaukee-Eight”

H-D new engine — “Milwaukee-Eight”

According to the rumor mill, Harley-Davidson is set to release a new engine in certain touring models for 2017.

The new engine is called the “Milwaukee-Eight”.

The engine will have four valves per cylinder and be increased to 107 cubic inches, or 1753cc.There have been seven distinct engine designs from the motor company since 1914, and Harley-Davidson has been consistent with air-cooled, pushrod driven, two valve per cylinder designs.  The new engine is the eighth in the line and may explain the naming convention. The new engine will be air cooled, but the increase in the number of valves will help make the new engine compliant with increasingly more stringent emissions laws.

The official unveiling is reportedly to occur in a couple of weeks when Harley-Davidson rolls out the new 2017 models.

Photo courtesy of Harley-Davidson and motorcyclelife.com.au

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Indian Motorcycle 2017 Line-Up

Indian Motorcycles

Could this be a historic mark on Sturgis?

Seventy-five years after Ed Kretz dominated the first motorcycle race on the sands of Daytona Beach, Indian Motorcycle announces the 2017 line-up just days before the start of the 76th Sturgis Motorcycle Rally and just hours before Harley-Davidson’s Q2’16 financial results.

Indian states the 2017 lineup includes the recently released Scout Sixty, Indian Springfield and Chief Dark Horse models with new color choices.

A new and the industry’s largest and brightest touch-screen information and entertainment system has a 7-inch display with turn-by-turn navigation, Bluetooth audio and USB flash drive support. The Chieftain bikes come with 100 watts of audio, while the more expensive Indian Roadmaster has 200 watts.  The screen is glove compatible with two-finger touch capabilities, according to the company.

Indian has grown at a brisk pace, introducing nine new models since its relaunch in August 2013.  The motorcycle industry is looking to be flat this year, so Indian and Harley-Davidson are in a share battle.  For the full year, Polaris sees motorcycle sales increasing in the high teens on a percentage basis.

Time will tell if it’s a brand, a dealership or a bike thing as the two companies slog it out in the back half of the year.  On the surface it looks like Indian will once again challenge its main rival.

If you are headed to the 76th annual Sturgis Motorcycle Rally,  riders can view the entire new 2017 lineup at the Indian Motorcycle Factory display on Lazelle St. or experience them firsthand with a Factory Demo Ride at 2100 Whitewood Service Road (I-90 at Exit 30) from August 6 – August 12 from 9 a.m. – 5 p.m. daily.

Photo courtesy of Indian Motocycles.

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