Motorcycle sales throttle up again in Wisconsin

25 November 2013 12:09 AM

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The long motorcycle recession may finally be over, with national sales edging upward and Wisconsin bike registrations up considerably from five years ago.

Recent data from the Motorcycle Industry Council, published in trade journals, shows a 0.9% year-over-year sales gain for the third quarter, erasing a 5.2% decline registered through the end of the second quarter.

Sales of off-highway and dual-sport bikes showed the greatest percentage gains, while scooter sales continued to lag and were down nearly 17% from a year ago.

The Motorcycle Industry Council compiles its figures from the major manufacturers including Harley-Davidson, Honda, Kawasaki, Yamaha, Suzuki, BMW, Can-Am, Ducati, Triumph, KTM, Victory and the Piaggio Group.

The council's state-by-state sales data is not made public, but according to the Wisconsin Department of Transportation, 60,068 motorcycles were sold in the state in 2012, up nearly 14% from 2011. Moreover, there were 357,818 motorcycles registered in Wisconsin as of June 30, the most recent available data — up 1% from 2012 and up 17% from the depth of the recession in 2008.

U.S. motorcycle sales plummeted in the recession, when consumer credit tightened and many people who lost their jobs — or worried about losing them — quit buying expensive nonessentials.

"I don't think anything will ever be quite that bad again, hopefully not in my lifetime," said Robert Moakley, owner of Wisconsin Harley-Davidson, in Oconomowoc.

"If you survived it, you probably came through it for the better. It was a fantastic learning experience. That's about the best you could call it," Moakley said.

The recent uptick in sales has been sporadic, according to dealerships, although most of the older inventory has finally been sold.

A glut of model-year 2011 and 2012 bikes was cleared out through wholesale auctions, said Tom Van Zeeland with Team Winnebagoland in Oshkosh.

"I have seen a lot of the auctions slow down, whereas before there was one about every three weeks from dealerships going out of business or bikes still in crates in a warehouse," Van Zeeland said.

Harley-Davidson's model-year 2014 touring motorcycles are selling well, according to dealerships, and the company reported a 20% surge in U.S. motorcycle sales in its recent fiscal quarter.

Sales of some Japanese-made heavyweight cruisers have lagged dealers' expectations, and dealers say scooter sales are far below what they were a few years ago.

A cold, wet spring across much of the U.S. put a damper on motorcycle sales that many dealers found difficult to fully recover from.

"Weather trumps the economy. I believe that wholeheartedly," said Rob Strauss, owner of Rob's Performance Motorsports in Waukesha.

The introduction of Harley's Project Rushmore touring bikes has resulted in a flurry of trade-ins of recent model-year tourers.

New products such as Harley-Davidson's Street motorcycles are expected to help the industry continue to climb out of its slump. The Street bikes, at Harley dealerships next spring, are the company's first smaller engine motorcycles since the 1970s.

The 500cc and 750cc Streets are aimed at younger riders and replace the former Buell Blast as the bike used in Rider's Edge classes at Harley dealerships.

These bikes are expected to pay dividends down the road as younger riders hone their skills on them and get plugged into the rest of the company's motorcycle lineup.

"What I am concerned with now is my used bike inventory is very heavy. We are reaching out to other dealerships down South to see if we can wholesale some bikes out and get our cash back out of them," he said.

Sales of dual-sport motorcycles, which can be used on or off the highway, have shown some of the strongest growth this year — up nearly 8% in the third quarter from a year earlier, according to the Motorcycle Industry Council.

Prices of dual-sport bikes range from about $4,700 for a new 250cc Honda to $13,500 for an 800cc BMW. For some riders, the dual sports are a break from the "cookie-cutter" cruiser style bikes they've known, said Strauss, with Rob's Performance Motorsports.

Strauss said his sales of snowmobiles and all-terrain vehicles have been strong, along with dual-sport bikes. Sales of the biggest high-performance sport bikes have dried up, partly because it's too expensive for younger riders to get insurance on them.

Similarly, used-motorcycle dealerships say sales of heavyweight cruisers and the biggest sport bikes have languished, while smaller, less expensive bikes are selling well.

Sales of cruisers once popular with middle-age men have been painfully slow, said Mike Connell, owner of All Pro Motorsports in Waukesha.

All Pro sells used motorcycles across the United States and overseas. It ships some bikes to Australia because, even with shipping costs, they're cheaper for Australians.

Used midsize cruisers under $3,500 are some of the best sellers at All Pro, along with 600cc sport bikes priced under $5,000.

Young sport-bike riders are always going to "scrape together whatever nickels they can" to buy a motorcycle, Connell said. It's not the middle-age guy who is thinking about his family and his retirement.

Some dealerships benefited from truckloads of heavily rebated motorcycles from manufacturers that produced way too many of them.

But four years ago, the Wisconsin Powersports Dealers Association sought state legislation aimed at preventing motorcycle manufacturers from coercing dealerships into taking inventory they couldn't sell.

Dealerships complained they had to order too many bikes or they wouldn't qualify for retail rebates on their entire product line. If they refused, it could cost them hundreds of thousands of dollars in lost rebates.

Senate Bill 302's opponents, including some large dealerships, said it would eliminate volume discounts. After debate in the Legislature, the bill died.

Dealerships say they're no longer flooded with excess bikes, but the days of customer waiting lists for popular models are mostly over.

There's a better balance between what manufacturers produce and customer demand, Van Zeeland said, and buyers have become more conservative in their purchases — not necessarily getting the most expensive bike they would have bought a few years ago.

"A lot has changed since 2009. The manufacturers now realize they can't just pump out a bunch of motorcycles and expect them to sell," Van Zeeland said.


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