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Posts Tagged ‘Polaris’

screen-shot-2017-01-09-at-11-15-09-amPolaris, the MN-based maker of motorcycles and all-terrain vehicles announced today that it’s winding down the Victory brand effective immediately to concentrate on its better-performing Indian Motorcycles business.

Polaris said it will assist dealerships in liquidating inventory and will supply parts for another 10 years and honor warranties in place.  Victory motorcycles are primarily manufactured in Spirit Lake, Iowa.

The first Victory motorcycles rolled out in 1998, yet never took much market share from Harley-Davidson Inc., in the cruiser-bike category. Indian Motorcycles, which Polaris relaunched after a 2011 acquisition, has performed better, however Harley’s market share remains at 48 percent to Indian’s 3 percent.

Polaris Industries Chairman and CEO Scott Wine stated, “This decision will improve the profitability of Polaris and our global motorcycle business, and will materially improve our competitive stance in the industry. Our focus is on profitable growth, and in an environment of finite resources, this move allows us to optimize and align our resources behind both our premium, high performing Indian Motorcycle brand and our innovative Slingshot brand, enhancing our focus on accelerating the success of those brands. Ultimately this decision will propel the industry-leading product innovation that is core to our strategy while fostering long-term growth and increased shareholder value.”

Photo courtesy of Victory/Polaris.

All Rights Reserved (C) Northwest Harley Blog

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Saddlebag Drawing

Saddlebag Sketch

This is more than a simple saddle bag retaining clip that takes less than 10 minutes to replace.

Harley-Davidson is facing steep competition.  Not only from less expensive motorcycles imported from Asia, but electric motorcycles from Zero, Brammo (now owned by Polaris) and also from core customers who look for a mainstream gasoline cruiser from Indian and Victory.  Polaris will undoubtedly be first to market with a chrome-plated electric cruiser given the previous discussion by CEO Matt Levatich.

In addition, it’s not clear that Harley-Davidson is getting much of a sales bump from the decision to double-down on support of outlaw biker gangs as part of their marketing pitch.  The hard-edge reference is NOT about the one-percent patches, rather licensing support of TV shows like Sons of Anarchy (SOA) and other Hollywood fluff.  Trying to appeal to people who don’t have much adventure in their lives with a TV show prescribing on the road escapism… well it escapes me!   Meanwhile they try so hard to alienate and re-write the Baby Boomer chapter!

But I’ve digressed.

Harley-Davidson reported slipping revenues for Q2 2015.  U.S. market share is below 50% for the first time ever!  The company is betting on its name recognition and motorcycle quality.  They even choose to muster up some brash swagger and declined slashing prices as a subtle way of saying “our bikes are better!”

And on that quality topic, Harley recently issued a saddlebag recall – campaign number 15V-427.  The motor company is the poster child for the “land of recalls” sans Chevy.  So many, that owners find it difficult to recall when their bikes didn’t!

Snarky comments aside, all manufactures have issues, but Harley-Davidson is unique in acknowledging and using quality as a key differentiator and strategy for increasing sales.  I’m not sure how well that will work for them.

Meanwhile the Dealers are replacing the 4 (2 on each side) saddle bag pin retaining clips free of charge. The motor company issued a recall stating that the saddlebag mounting receptacle, P/N 10900009 on some model year 2014 and 2015 Touring family vehicles (see drawing #1 above) may not adequately secure the saddlebag to the motorcycle during use.  If this condition remains undetected, the saddlebag may become separated from the motorcycle while it is in motion, possibly creating a hazard for other motorists including your riding buddy’s in formation behind that “separated” bag.

If this happens there is a good chance you’ll be picking up a new “road rash” painted saddlebag and dirty laundry strewn across the roadway!

UPDATED: July 23, 2015 (1:40pm PDT) — the recall effects 185,000 motorcycles which covers certain 2014 and 2015 Road King, Street Glide, Electra Glide Ultra Classic, Ultra Limited, Police Road King, Police Electra Glide and CVO Ultra Limited bikes. Also affected are 2014 CVO Road King and the 2015 Electra Glide Ultra Classic Low, Ultra Limited Low, Road Glide, CVO Street Glide and CVO Road Glide Ultra motorcycles. No injuries or crashes have been reported due to the saddlebag issues and no information has been provided on the number of “separated” bags.

UPDATED: July 29, 2015 — Polaris introduces its 2016 line up which includes the Victory Empulse TT ($19,999), an electric model which rolls out way ahead of H-D’s LiveWire.  It’s based on the Brammo Empulse R motorcycle produced by the electric motorcycle division of Brammo Inc., which was acquired by Polaris earlier this year.

Photo courtesy of H-D.

All Rights Reserved © Northwest Harley Blog

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The 2015 Road Glide

The 2015 Road Glide

Harley-Davidson officially “revealed” the 2015 Road Glide this morning along with an updated web site with some additional details.

The “reveal” is a peculiar twist given that we’re a few weeks away from the typical new model launch window.  Here is the corporate press release announcing the 2015 Road Glide.  I’m sure it’s just the first stage of a lot of hype and media buzz planned for the traditional post-Sturgis announcements.

Or being a bit skeptical of marketing motives… maybe this H-D reveal is simply a tactic to take away some of the headlines from the 2015 PolarisIndian and Victory news?

2015 Road Glide Inner Fairing

2015 Road Glide Inner Fairing

Back to the Road Glide.

There are two models.  The Road Glide and Road Glide Special.  Both models include the same specifications from Project RUSHMORE that is currently available on 2014 touring models.  There is the air-cooled, high output Twin Cam 103™ with integrated oil cooler mated to a 6-speed cruise drive transmission, the new Reflex anti-lock braking system (ABS) with dynamically, electronically linked brakes for optimum braking in all conditions.  Both Road Glide models include the redesigned saddlebags for a sleeker look and added new latches that you can operate with one hand.

The 2015 Road Glide Fairing

The 2015 Road Glide Fairing

The 2015 Road Glide Special is basically an elevated experience of riding that includes the new Boom Box 6.5 infotainment system which features a 6.5″ full color touch screen display and it can be operated by convenient new hand controls or by voice command.  It also includes display color options: Orange (default), Blue, Brown, Green, Gray, Purple, Red.

There’s a new handlebar on the Road Glide motorcycle for 2015 that makes the riding position more comfortable for a wider range of riders and the hand grips are now 5 1/2″ closer to the rider.  There is also new gauges which has a 10% larger speedometer and tachometer with 68% wider numbers; 28% larger fuel and volt gauges with 30% wider numbers.

Most distinctive is the new triple-vented fairing that opens and closes to equalize pressure in front and behind the windscreen.  Lastly there is the new dual Daymaker LED headlamps providing better nighttime riding visibility.

I’ll be interested to experience how easy it is to reach and adjust the infotainment system.  Previously anyone under 6 feet tall could have an issue reaching up to the radio system.

I’m looking forward to seeing the new 2015 Road Glide at the local dealer.

Note:  If you’re tracking or curious how accurate any of the previous blog posts were:  Road Glide spy photos HERE.  Early 2014 Road Glide speculation HERE and HERE.

Photos courtesy of H-D.

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photos_large_5Don’t get your underwear wrapped around the axle with that title.

“Off the reservation” is a common phrase, which many people use without considering the context of its original meaning. Namely, that Native American peoples were restricted to reservations created by the U.S. government, and their freedom was severely limited by the terms of the treaties they were often forced to sign.

I’m using it in its literal sense (to deviate from what is expected) and as you might anticipate it’s a reference to Indian motorcycles rampant sales and intractable competition versus the Harley-Davidson Motor Company.

Harley-Davidson posted flat sales for Q2 2014, yet Indian/Polaris posted higher revenues for the second quarter 2014 at $1.01 billion, reflecting an increase of 20% over last year’s second quarter sales of $844.8 million.  Polaris stated that sales at its motorcycles division soared 107% year-over-year to $103.1M in large part due to strong demand for the new 2014 Indian motorcycles.  Clearly they have deviated from what was expected.  One could debate that given Polaris motorcycle revenue is much smaller than Harley’s, it’s easier for them to hit double digit growth numbers, but that would be down playing the strong demand for the Indian products.

Additionally, Harley-Davidson stated its share of the market for new heavyweight motorcycles with engines of 601 cubic centimeters or greater slipped to about 50% in Q2 2014 from 53% a year earlier.  Another indicator that competition is weighing on the company.

Financial calls with terms like ‘diluted earnings’ and ‘operating efficiencies’, don’t mean much to riders and it’s not like Harley-Davidson is hurting.  But, it’s good to see Indian doing well with North American retail sales up 15% year-over-year in the second quarter.

Congrats!

Full Disclosure:  I’ve got a riding buddy who traded his H-D Street Glide in on a new 2014 Indian back in January and loves it.  There is no dealer in Oregon yet and he went to the extra effort of buying it from a Seattle dealer.

Photo courtesy of Indian/Polaris.

All Rights Reserved © Northwest Harley Blog

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The heavyweight motorcycle market is approximately a $4 billion market.  Harley-Davidson is the market segment share leader with 2010 revenue of $3.14B.

Last week Polaris (CEO – Scott Wine) announced the acquisition of Indian, the nation’s oldest motorcycle brand. Indian’s best-selling model, the Chief, became known for the Red Indian logo on its fuel tank.  After twice filing for bankruptcy the manufacturing of Indian motorcycles restarted three years ago in Kings Mountain, NC.  The terms of the acquisition from British investment firms Stellican Ltd. and Novator Partners LLP were not announced, but given the strong brand portfolio of Indian I’m sure it didn’t come at garage-sale prices!

Polaris entered the heavyweight motorcycle market about 12 years ago and of the Polaris $2B in annual sales, about $82M comes from Victory motorcycles.  The Indian brand will help the company build on the Polaris’ presence in the market and directly compete with Harley-Davidson in the heritage brand sub-segment with its classic style.

Clearly the motorcycle landscape is changing and if you need further evidence just look at the recent announcement by BMW Motorrad who saw a 12.3% growth in the last financial year and sold 110,000 motorcycles.  They announced that Hero Motors (India company), as the sole supplier who will provide gearboxes for BMW’s motorcycles.  Not only are they the supplier, but Hero provided the engineering and developed the advanced technology for all BMW transmissions.

According to this Sioux City Journal article,  the U.S. production of Indian Motorcycles will shift to Polaris Industries’ Spirit Lake plant later this year.  Polaris is based in Medina, Minn., and they will close the existing Indian manufacturing plant in Kings Mountain in the next two to three months.

Photo taken at and courtesy of Indian booth.

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Riding Through Death Valley

You might not know, but the Laughlin River Run in Laughlin, Nevada is also the location of the first giant coal-fired power plant (Mohave Generating Station) to shutdown.

The closure created economic distress to the Navajo Nation, which supplied coal to Mohave through a slurry line at the Black Mesa Mine.   The motorcycle rally hangs on the skirts of the Colorado River and features large numbers of motorcycle enthusiasts wandering through vendor booths, casinos/resorts all setting next to the river’s edge.  I’m working on a detailed post for the ride down, but thought I’d post up a brief summary on some of the highlights:

  1. Our morning departure out of Portland found rain coming down in sheets and the wind blew like a hurricane.
  2. At one point it cost $24 to fill up a five-gallon Harley.
  3. My first motorcycle ride through Death Valley.
  4. The ‘River Run’ had all the built up energy for a spring rally, but the vendor “cha-ching” wasn’t quite as loud as in some years.
  5. Walked into the Aquarius Casino Resort and had no problem getting rooms without reservations.  Lucky?
  6. Room rates were 5X the typical standard pricing ($39.95 vs. $199.95/night).  Anyone who has made it through Econ 101 knows that the scarcity of a commodity drives its value, but this clearly qualifies as gouging (yet we paid it?!).
  7. The large presence of the Mongols MC members at the Aquarius made for some interesting moments entering/exiting the hotel.
  8. The Aquarius temporarily restricted access to the casino floor Saturday night at the height of the River Run, however, they deny rumors that the restriction had anything to do with the presence of “outlaw” motorcycle clubs.
  9. There was a large, well armed and highly visible Las Vegas Metropolitan Police presence at the River Run.  No major problems were reported.
  10. On Friday, April 29 we witnessed a 45mph+ sustained wind storm.  Number of show-class motorcycles damaged by flying debris.
  11. H-D was absent from one of the largest west coast rallies and relinquished customer goodwill to Polaris and Yamaha.  Why?

We’ve had so much nasty weather in Oregon during April that I’m confident about anything May throws at us will be better.

Photo taken on trip in Death Valley.

All Rights Reserved © Northwest Harley Blog

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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.

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