Road Trip - Chicago International Motorcycle Show

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Another One Bites the Dust?

I realize that I keep going back to this but the problem continues to grow. The nose diving economy continues to beat down the helpless motorcycle market. If you recall, I mentioned some of the unorthodox attempts at boosting motorcycle sales in earlier posts and podcasts. Just in the last 30 days we have seen some of the biggest names in the industry knocked to their knees, a place that they have not found themselves in many years. It was a good run baby!
December 15th brought us the news that American Honda was withdrawing from AMA road racing. Following right on the heels of that on December 19th, Honda announced that the 2009 Honda Hoot motorcycle rally was being canceled as well. How could a corporation with such a storied existence in the motorcycle industry be pulling the plug on a successful racing program and a top five motorcycle rally? It's not over till the fat boy sings and I ain't even started warming up yet.
The new year rings in and all is quiet for the first few days and then January 7th shines upon us. This is the day that Kawasaki announced that they were pulling the plug on running the 2009 through 2011 season of the MotoGP. It did not take long for the MotoGP boys to flex the muscles as Kawasaki was rumored to have been threatened with a $60 million fine should they decide that they are not running. They are under contract through the 2011 season but it is still to be seen what decision they will make. If you don't have the money to run, what makes anyone think that they are going to get cash for breach of contract. Keep your eyes open on this one.
January 14th brings the rumor that Suzuki will follow Kawasaki through turn 1, balls to the wall, and forego the MotoGP season as well (http://www.motogpmatters.com/news/2009/01/14/suzuki_to_follow_kawasaki_exit_rumors_pe.html). Hmm...are we to assume that there will be another large threat pointed in the direction of Suzuki? My money says that you better believe it. Does Suzuki think that they are going to be an exception? And today, January 15th, we get the sad news that KTM has pulled out of the Red Bull/AMA Rookies Cup series that builds MotoGP riders from the age of 13. When will all of this end?
The industry is suffering. Demand for motorcycles is declining as consumers are afraid to part with cash or unwilling to get tied into a credit contract. Credit is tougher to get and those that are willing to sign on the dotted line are being shell shocked by the higher interest rates being charged which, in some cases, changes the mind of an otherwise willing buyer. I mentioned in episode 3 that I will be attending the International Motorcycle Show in Chicago in early February. I have been trying to find attendance figures for the shows that have already taken place for this season but have been unable to come up with any. I am extremely curious to see how many people show up at the show and I will also be trying to keep an eye the sales that are, or are not, taking place.
The economy is tough on all businesses but more so on those industries that are considered "entertainment" or "hobby" industries. Motorcycles fall into that category as a small percentage of motorcyclists are die hard, rain or shine riders that ride as transportation. Most of the rest have the motorcycle for those warm, sunny days that pop up. If you are not putting the miles on the motorcycle it is hard to justify the purchase, especially in this economy. Until things turn around, the question is not if any more industry leaders go down, but who is it going to be? Another one bites the dust...and another one gone, and another one gone, another one bites the dust. Could this be you Suzuki?
Keep your fingers crossed we don't have to read about any more.
Ride Safe
Bullitt

The Economy and Motorcycling

This is going to be a rather short post but I had to write it. As the price of gas climbed over the past couple of years, we motorcyclists have had a slight escape from the pain. With motorcycles getting 40+ miles per gallon many fair weather riders had to give more thought to riding to work rather than leaving the bike sitting in the garage. We speculated that there would be a run on two wheelers as many people looked for that escape as well. For the most part, it looks like the spike in sales was realized in the scooter area. The scooter is usually cheaper than the low end motorcycles so the consumer went in that direction.
As gas prices leveled off and even began to decline lately, motorcycle sales are still hurting as most people are trying to hang on to every dollar that they have. The fear of the unknown has a huge impact on the opening of the wallet. I was shocked earlier this year when Harley Davidson laid off workers in the assembly plant in York, PA. Since the buyback of the company from AMF HD has enjoyed record sales each quarter. To see them suddenly be forced to send people home and cut production shines a bright light on our sport right now.
This post was inspired by a shocking news story that I read yesterday. On Friday, Honda announced that the Honda Hoot will not be held this year. The Hoot began fifteen years ago in Asheville, NC and moved to Knoxville, TN in more recent years. It is consistently in the top 5 motorcycle rallies every year. Honda felt that the economy would cut into attendance this year and I am sure that the company did not want to lay out the cash to put it on either. The poor economy has reared it's ugly head and is boring down full tilt on motorcyclists everywhere. What will be next? Daytona? Sturgis? Laconia? Myrtle Beach? We will soon find out as Daytona will be upon us in just over 2 months. We can only hope that the Hoot will make a grand return in '10.
Steve