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Posts Tagged ‘Newsweek’

Polaris Industries -- Victory Motorcycles

Creativity.

There is a fascinating and quite boring article in ‘Newsweek’ about the creativity gap, how creativity is declining in America.  Reading it I couldn’t stop thinking about the motorcycle business and specifically Harley-Davidson.

Given it’s earning season; H-D announce earnings HERE, now it’s Polaris Industries Inc. (NYSE: PII), makers of the Victory motorcycles turn who reported its Q2’10 net income of $25.6 million.  By comparison, the 2009 second quarter net income was $17.5 million.  Sales for the second quarter 2010 totaled $430.9 million, an increase of 25% from $345.9 million recorded in the year-earlier period.

Scott Wine, Polaris’ CEO stated:

“Polaris maintained strong momentum in the second quarter, driven by solid market share gains, sales growth and margin expansion. Innovation and execution enabled us to deliver another quarter of solid operating results in an overall economic and powersports industry environment that remains sluggish.”

Yeah, but you’re likely saying that’s all ATV and snowmobile sales, right?  True the lions share is off-road sales, but specific to sales of the On-Road Division, which primarily consists of Victory motorcycles, they saw an increase of 48% during the second quarter of 2010 vs. the same period in 2009. The N.A. heavyweight cruiser and touring motorcycle industry remained weak during the quarter, but Victory motorcycles had strong retail sales during the second quarter, increasing more than 10% in N.A. compared to the second quarter last year, resulting in overall market share gains and retail sales growth for the third consecutive quarter. The increased demand reflects the popularity of the new 2010 Cross Country and Cross Roads touring models.   The N.A. dealer inventory of Victory motorcycles declined 32% in the Q2’10 compared to 2009 comparable levels. The sale of Victory motorcycles in markets outside of N.A. continues to accelerate, with sales reaching 25% of total On-Road/Victory sales for the year-to-date period.  And lastly the income from Polaris financial services was $4.2 million for Q2’10 compared to $4.0 million in 2009.

I can’t put my finger on it, but there is something missing for me with the Victory motorcycle.  Maybe it’s just the “bar-n-shield” logo and now my bias is showing?  But I balk at comments from riders that claim Victory is NOT a threat or competition for H-D… it just doesn’t ring true.  The cruisers are more roomy, the engine has more HP, the motorcycle is lighter, has a lower seat, larger saddlebags all at a cost of thousands less means Victory is doing a lot RIGHT on the creativity front.

In other words, the Harley-Davidson businessmen look to squeeze all the creativity out in the name of profits.  And now the business is in the hands of the manufacturing line worker, who are always the least creative element in the chain.  The engineers designed out cost, the line-worker built them at the lowest cost, the dealer sold them slightly above cost. Now the company is trying to fix the business, but are flummoxed.  Do they truly think cutting out cost, means somehow people will magically appear?

They’re not and meanwhile Victory ratchet’s up innovation.

Photo courtesy of Polaris/Victory Motorcycles.

All Rights Reserved © Northwest Harley Blog
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It’s disturbingly commonplace and pretty workaday stuff for law enforcement.

If you are an owner of one of the country’s 277 million cell phones, it’s possible that your cell-phone company retained records of where your device has been at all times.

Cell phones have tiny GPS devices embedded inside or because each phone call is routed through towers that can be used to pinpoint the phones’ location to within areas as small as a few hundred feet.

And as the government continues it’s relentless intrusion into the private lives of citizens, cell-phone tracking has become commonplace and among the more unsettling forms of government surveillance. The ease at which your location information can be accessed is a question posed by a Newsweek article, which outlines the various methods local law-enforcement agencies and the Justice Department can use to trace Americans’ cell phones–tracking that in some cases can be done in real time. According to the article, courts across the country routinely agree to police requests for cell phone location information.  The legality of such requests is somewhat murky and there is anecdotal evidence of abuse of the system, with requests that are clearly personal.

What if the Justice Department wants to track political protesters or motorcyclists at the Washington CoC Run?  Or how about track all the motorcycle enthusiasts who arrive at the state capital for “Black Thursday” in Olympia to protest unfavorable biker legislation?  Apparently, it may all be allowed.

It would seem the Orwellian day of Big Brother secretly following motorcyclists movements through the cell phone device in our pocket is here.  Currently, the records are obtained under what is known as “2703(d)” orders—a reference to an obscure provision of a federal law known as the Stored Communications Act—in which prosecutors only need to assert that there are “reasonable grounds” to believe the records are “relevant” to an ongoing federal criminal investigation, a much lower standard than that needed for a search warrant.

When the Wireless Communications and Public Safety Enhancement Act of 1999 was passed, I don’t think they thought about law enforcement over reach or customer’ privacy information related to location-based services.  I encourage preservation of the Fourth Amendment and think it’s time that Congress clarify the terms under which location information may be released to law enforcement.

Until then, if you’re someone who does not wish to disclose their movements to the government then you’ll need not use a cellular telephone.

Photo courtesy of Apple.

All Rights Reserved © Northwest Harley Blog

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Meetings.  Talking.  Meetings.

We’re always being reminded that political leaders, policymakers and industry leaders are “gathering” to hash out ideas on how to get the mojo back and what the key is to unlocking innovations and jobs of the future.  We’re suppose to feel good, but from my vantage there is little visible in the way of action.

The White House has made a quiet but extensive effort to reach out to corporate executives in a series of dinners and lunches at the White House with President Barack Obama.  Attendees have largely been kept secret or at minimum very quiet… until now!

Politico.com states Keith Wandell (Harley-Davidson CEO) had dinner with Obama’s chief of staff Rahm Emanuel and other top White House officials.  Another comprehensive list is available HERE.  It’s not clear if it was at an off-site local restaurant or something more elegant in the White House.  Given the state-of-the-states, I seriously doubt the motor company will be creating any new jobs soon. In fact, the recent ratified agreement calls for a drawdown of nearly 50% of the employee’s base at the York, PA operations.  Asia or India look like expansion alternatives and I suspect it won’t be long before we hear about plants being set up there.  So, what did Mr. Wandell share w/ the White House chief of staff?  Would H-D coming to the government to offer ideas on how they can help be a startling conversation changer?  Does H-D have eyes and ears on future trends that they can grab and then be able to exploit?

I’m not sure, but do you think the U.S. is still the world’s center for innovation, or is it falling behind countries such as India and China?  Fueling the debate is a new poll on innovation published by Newsweek. One interesting finding: while 82% of Chinese citizens believe the U.S. remains a technologically innovative country, only 74% of Americans feel the same way.

At any rate,  the other industry officials who joined Mr. Wandell at the June 16, Rahm Emanuel dinner were:

Penny Pritzker, CEO, Pritzker Realty
Mark Gallogly of Centerbridge Partners
Mike Fascitelli, CEO, Vornado Realty Trust
Klaus Kleinfeld, CEO, Alcoa
Dave O’Reilly, CEO, Chevron
Richard Smith, CEO, Realogy
Mike Ullman, CEO, J.C. Penney
Keith Wandell, CEO, Harley Davidson

I’m not attacking or implying that only favor-curriers are “sitting at the presidents table” but I’m not reading a lot about how the voice of the average lower and middle class American are being heard.  As the White House National Economic Council Director Lawrence Summers has recently urged attendees at these dinners to “think about what your institution should be called on to do, not in its own interest, but in the broader national interest.”

Photo courtesy of Presidential inauguration.

All Rights Reserved © Northwest Harley Blog

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