Motorcycle Industry Analysis
ATV, and Personal Watercraft Dealers Industry. This U. S. ndustry comprises establishments primarily engaged in retailing new and/or used motorcycles, motor scooters, motorbikes, mopeds, off-road all-terrain vehicles, and personal watercraft, or retailing these new vehicles in combination with repair services and selling replacement parts or accessories. Statistics In terms of looking at the whole industry, motorcycle dealers make up a majority of the industry when compared with ATVs and personal watercraft dealers.
The chart below shows statistics from 2002 comparing the motorcycle dealers with all other motor vehicle dealers in the industry.
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The results show the growth and percent changes in certain categories pertaining specifically to the motorcycle dealer industry. While the number of establishments only increased approximately 21 percent, the amount of sales increased almost 99 percent. The annual payroll (excluded from the graph) increased 100 percent and the paid employees rose by 59 percent. These figures, illustrated through a bar graph below, indicate a growing industry especially for those companies already in the business with establishments formed. Motorcycle Dealers
Although there are many nonfranchised retailers in the industry, 80 percent of the industry’s business is made up of franchised outlets.
The average franchised motorcycle outlet generates sales and services almost six times that of nonfranchised outlets. In addition to selling motorcycles, dealers make up almost half of their business through sales of parts, accessories, and apparel. In 1997 approximately 6. 5 million motorcycles were owned in the United States, with California having almost two times more retail outlets than any other state.
In terms of rider distribution, California, Texas, New York, Florida, and Ohio accounted for more than one-third of all motorcycle ownership in the U. S.
In terms of a target market there seems to be no specific or clear differentiation. Below are some statistics that allow one to make judgments based on the Harley Davidson demographic profile. Gender20002001200220032004 Male91%91%91%90%90% Female9%9%10%10%10% Purchasers (2004) • 42% Owned Harley-Davidson® motorcycle previously • 31% Coming off of competitive motorcycle • 27% New to motorcycling or haven’t owned a motorcycle Background and Competition The earliest motorcycles were basically bicycles powered by small engines, and the motorcycle was considered a relatively cheap alternative to the more expensive, early automobiles. Many U. S.
manufacturers produced motorcycles before World War I, contributing to a dynamic, if not booming, domestic market. Harley Davidson, Orient, Henderson, Cyclone, and Indian were the primary competitors at that time. Henry Ford‘s affordable Model-T, however, doomed many motorcycle manufacturers. In fact, by the end of the Great Depression, the only remaining manufacturers and sellers of motorcycles were Indian and Harley-Davidson.
Indian closed down production and distribution in 1953.
The late 1950s and early 1960s saw the first influx of low-priced, smaller Japanese motorcycles and scooters into the United States. Honda began U. S. distribution of its products in 1959, with the slogan, “You meet the nicest people on a Honda,” to combat the negative image associated with the sport. Yamaha starting selling motorcycles in the United States during 1960; Suzuki followed in 1963; and Kawasakii joined the competition in 1967.
BMW opened a U. S. distribution arm in 1975, incorporating in New Jersey.
Harley-Davidson ended years of private ownership in 1965 with a public offering of its stock, and eventually merged with industrial giant AMF in 1969. The oil crisis in the 1970s prompted the popularity of the smaller motorcycles, mopeds, and scooters that were made primarily by Japanese manufacturers.
Dealers sold vehicles to those interested in conserving gas and finding cheap transportation. Harley-Davidson’s market share, already dropping, was further threatened by Honda’s 1969 entrance into the heavy and super heavyweight segment of the market.