Harley Woes

[F6Dave]

I was having my truck serviced last week and walked to a nearby Honda dealer while I waited.  I talked to a salesman I've known for a long time and asked him about the row of about a dozen used Harley Davidsons on the floor.  He said they had an agreement with a finance company to take their repossessed Harleys.  Apparently, the H-D dealers don't want them as they are having too much trouble selling new motorcycles.

How things have changed!  Just 10-15 years ago you could buy a new Harley, ride it for a year, then sell it for more than you paid.

But Harley isn't alone.  The same salesman said they used to sell a few dozen small Hondas right before Christmas, but these days they're lucky to sell 2 or 3.  And a salesman at another Honda dealer told me of a Saturday in the 1980s when they delivered 11 new Goldwings.  They would have delivered an even dozen but one owner couldn't get to the dealership before closing time.

I'm amazed that we still have such a large selection of excellent motorcycles to choose from.  But I get this feeling that in a decade or so the motorcycle marketplace won't be so broad, and we'll look back at this time as the 'good old days'.

[f6john]

Locally, our Honda dealer of forty years sold out to the owner of the Nissan car dealership across the street. He tried to incorporate car salesmanship tactics to motorcycles and after a few years it was a flop and closed. Next up, someone who apparently knew little of business and motorcycles opened it back up, they didn’t last a year.

I think the manufacturers are pricing themselves out of the market and possibly just don’t understand their market anymore.

[Serk]

I went to the local Honda/Yamaha/Kawasaki dealer yesterday to pick up the Helix after they did some work on it.

Row after row of 4 wheelers, all terrain vehicles (I saw one that proudly had a price hanging from it as if this was a good deal of $17,500!!!!) and other such non-street stuff...

Oh, and a few motorcycles in the back, almost as if an afterthought...

(Granted, it IS around hunting season, and this dealer is on the border of several very rural counties, which I'm sure has a lot to do with it, but still.....)

[cookiedough]

 a few cycle dealers around are also selling new and used boats and UTV/ATV's as an all around sports shop.  I think that is a good idea if having the money to keep the doors open.  Am sure like all sales,  a lot of tire kickers come in and just snoop around is all.  The price on the machines are not bad, until the dealer attempts to tack on say 300-500 more for DEALER service fees which they say is needed and justified....

Just like auto sales,  years ago the dealer service fee was 85 bucks for a very long time which I can deal with.  NOW,  I have seen as high as 299 bucks for dealer service fee which is suppose to cover paperwork basically which is B.S. since most fancier dealers all have electronic eqmt. to do it all for them.

The local mom and pop Honda dealer where I bought my I/S from about 8-9 years ago or more closed shop a few years later now is a detail shop for autos. Sales is a tough market to make a living in.

[hubcapsc]

How things have changed!  Just 10-15 years ago you could buy a new Harley, ride it for a year, then sell it for more than you paid.

More like 18+ years ago, when I got my last Harley... I got mine during the "sucker" years. 

When I sold my low mileage Harley in 2006 people didn't line up to buy it, even at
half what I paid for it...

-Mike

[Jess from VA]

I too visited one of the better big metric dealers in Northwestern VA last week (looking for a helmet).

Mid day, mid week, and the place was like a ghost town.  

Nice selection of bikes small and large (and big scooters), but a huge selection of ATVs; two across, three across, front and back seats, dump-truck beds, two and four wheel drive, one looks just like a Jeep CJ5, plus all the small and tiny ones for kids.  I always enjoy looking at these small truck-like ATVs, and imagine how much fun I could have on one, but not in a suburban neighborhood, and no legal trails anywhere.

One salesman/owner sitting at his computer.  Said the whole business is going down the drain.... kids and young people today live at home with their parents and don't want to work or (or ride).... they just sit in their basements and play with their joysticks.  

The Big Harley dealer across the street also mostly empty, and their nice snack bar, coffee and sandwich shop closed for months. (If you ask if they have any helmets without HD branding, they look at you funny.)

We are an aging (and dying) breed.  

Same thing with private aviation (for 25 years now).  

[J.Mencalice]

I was having my truck serviced last week and walked to a nearby Honda dealer while I waited.  I talked to a salesman I've known for a long time and asked him about the row of about a dozen used Harley Davidsons on the floor.  He said they had an agreement with a finance company to take their repossessed Harleys.  Apparently, the H-D dealers don't want them as they are having too much trouble selling new motorcycles.

How things have changed!  Just 10-15 years ago you could buy a new Harley, ride it for a year, then sell it for more than you paid.

But Harley isn't alone.  The same salesman said they used to sell a few dozen small Hondas right before Christmas, but these days they're lucky to sell 2 or 3.  And a salesman at another Honda dealer told me of a Saturday in the 1980s when they delivered 11 new Goldwings.  They would have delivered an even dozen but one owner couldn't get to the dealership before closing time.

I'm amazed that we still have such a large selection of excellent motorcycles to choose from.  But I get this feeling that in a decade or so the motorcycle marketplace won't be so broad, and we'll look back at this time as the 'good old days'.

The disappearance of the middle class due to various socioeconomic and political factors is what I feel to be the primary cause of this shift. The upper class don't ride motorcycles and the lower class can't afford anything bigger than a 250-350 cc commuter.  Heck, the commuter electric scooters are all over cities these days; rent'em for a few bucks to get cross town with ease and then just leave them by the curb when done. Basically disposable transportation.  Who needs a Harley or Valkyrie or Gold Wing to get to the computer store?   Generational differences are in play from the latter part of the 20th century to the beginnings of the 21st century and moving those paradigms to totally different arenas.
Bowie sang it's praises starting in the 70's: "....ch-ch-ch-ch-changes..."   In short, we're getting replaced.  A fast approaching development of electric motorcycles is on the horizon and gasoline users will be gone in 30-40 years.  My dad used to tell me that he missed his Model A (only for it's simplicity, not it's constant breaking) back in the 50's.  Now I know what he was talking about.

[Jess from VA]

I don't think the middle class is going anywhere. 

[Willow]

I don't think the middle class is going anywhere. 

I would agree.  My observation is the middlw class is at least as large and better off financially than ten years ago.

I think the assessment of age and interest is applicable.

[markymark640]

I think the numbers contradict that and have documented the shrinking middle class over the years.

The middle class in the 70's was 61% of income earning families.

And not surprisingly, by 2015 that number has shrunk to 50%

The oldest age group surveyed is the ONLY group whose income grew.

But as we all should know, these numbers really depend on where you live. Certain areas have much higher or lower percentages of folks designated as 'middle class'.

Some areas, like parts of Texas as an example, where incomes have risen due to the oil industry, have an even lower than normal percentage ( lower than 50%).

Some economists would argue that we are actually doing better overall because of the number of folks that have left the 'middle class' bracket, only to become Lower Upper Class.  Not too sure about that but it's an argument that has been made.

And don't forget a big factor in determining which bracket folks fall into is the 'Number of Children'.  And I think for the most part the typical American family is alot smaller than they use to be.  I come from a family of 5 kids. I don't know but ONE family that has five or more children today.
So the same income, with less children can put alot more families in the 'Middle Income' bracket.

[Willow]

Points well made but when someone refers to the shrinking middle class the impression left is that middle class individuals are dropping into a lower income class.

I have eight children.  I've always considered myself to be part of the middle class.  Six of my children's families appear to be easily middle class.  Two of my unmarried boys, not so much.

A good deal of the determination of whether the middle class is shrinking is depending upon how the "experts" define the middle class.  The value of money and possessions is changing over the years.  That makes it more complicated than who earned $50,000 to $150,000 and who did not.  Then the population is growing.  How many immigrants impact the middle class count?  How many young people entering the self supporting masses impact the middle class count?   

I personally believe a lot of the talk of the shrinking middle class is largely propagandistic BS.  I do recognize that the exit of jobs from within the U.S.A. is a negative against both the middle and lower economic classes within the U.S.

That's a bit off topic for a discussion of problems in the large motorcycle sales.  It's just saying I don't think it's a significant factor.     

[Jess from VA]

I personally believe a lot of the talk of the shrinking middle class is largely propagandistic BS.

This.   

[Serk]

I personally believe a lot of the talk of the shrinking middle class is largely propagandistic BS.

This.   

Depends on the region really... Some areas, such as California, are indeed driving the middle class out. The very rich are staying and paying the extremely high cost of living, the extremely poor are staying to suck the teat of the welfare state, but the middle class are leaving in droves...

[cookiedough]

not so sure lower/upper class sounds better to me than middle class?  My girls boyfriend in college 2 weekends ago got to talking late at night all of us together and he brought up the topic of middle and lower and upper middle class.  Pretty sure he even commented that his mom thinks they are only middle class but he agrees after visiting where I come from and our town/house,  they are middle upper class vs. my family being lower middle class.   It is all how you spend the money though.  99.9% sure they spend tons more money than we do since he said they have a cabin on the lake way up north, a nice powerboat, and even a wine cellar (or did he say wine fridge?) and my daughter who likes wine said she had one of their 100 dollar bottles of wine and she could not tell the difference vs. a 10 dollar bottle of wine...    I thought that was funny. 

I have seen those electric bicyles and small cycles parked in bigger cities where you can just go from place to place thinking that is kinda neat, but after looking at one up close, not much to them like a small dirtbike with skinny seat not very comfy.    I do hear though that some of those electric cycles are pretty darn fast off the line, but not much for long distance cruising running out of battery juice before having to charge them up.  Not much I do not think that can go wrong with them though running on electricity besides a NEW battery every few years and am sure that is not cheap to replace though either. 

[pago cruiser]

Middle class study: definitely not BS.

https://www.brookings.edu/blog/social-mobility-memos/2018/06/05/seven-reasons-to-worry-about-the-american-middle-class/

Excerpt:
"These statistics are sobering, and they imply that there is a great deal of work to be done to improve the prospects of the American middle class."

And before it is dismissed out of hand as being a liberal/conservative biased organization:
From wickipedia:
"An academic analysis of Congressional records from 1993 to 2002 found that Brookings was referred to by conservative politicians almost as frequently as liberal politicians, earning a score of 53 on a 1–100 scale with 100 representing the most liberal score.[19] The same study found Brookings to be the most frequently cited think tank by the U.S. media and politicians.[19]"

Hm. This topic could use a dedicated thread, instead of crapping in the HD thread...

Speaking of...
Harley-Davidson international retail motorcycle sales were up 2.6 percent in the third quarter of 2018 compared to 2017 and U.S. retail sales were down 13.3 percent. Worldwide retail sales decreased 7.8 percent.

And:
"Harley's stock tumbled by as much as 6.7 percent to a 52-week low of $36.15 in morning trading Tuesday. It has fallen by almost 24 percent so far this year, closing at $38.73 a share Monday."

Dang.

[¿spoom]

The middle class just isn't buying motorcycles IMHO. They are buying 4 wheelers, and not snowmobiles, from what I've seen lately. If anything the declining skills/attention spans of car drivers are literally killing off interest for many in riding anymore.

[Pappy!]

Back on the subject.....I think the shrinking market for motorcycles is due to the manufacturers not understanding the market. Aging buyers? Yes, but........
The market seems to be very divided. The ADV style rider, cruiser riders, sport bike riders, and off road riders not to mention the new breed of 3-wheeled vehicles.
In most of these categories the manufacturers have built bikes that are technically well above the needs of the normal riders and the prices seem to reflect that so the manufacturers are creating the shrinking market to some extent.
One shining star is starting to emerge however is the "Retro" bike market that are starting to show up.
Look at the market share for Triumph as an example. They seem to be steady and actually increasing their market share a bit by producing what people want without a lot of extras people do not want.
My .02 worth. See what you think ?

[Jess from VA]

Pappy, I agree with you on manufacturers being more interested in producing what they want, rather than what rider's want, and the resulting higher prices.  Although things like safety features of abs, or linked brakes, or air bags, etc may be more a result of what government wants, or to avoid liability lawsuits, than only because it's what the manufacturer's want (of course, no manufacturer can ever afford to incur the wrath of the G or it's legions of regulators).

However, I also think the market of those who want to ride and to buy motorcycles is diminishing for more reasons than simply price.  I was just perusing my local Craigslist with 1079 bikes for sale today, and while some were pretty steep, hundreds were not.  People don't have to buy new to ride.  Over 45 years of riding, only one of my motorcycles was new.  The younger half of our population just doesn't seem to be interested in riding.

I'm only on my 2d new four wheeled vehicle in my life, and I have to say the prices for new cars and trucks seems exorbitant in many ways.  The bells and whistles and safety fanatic and fuel economy list just seems to get longer and longer for our cars and trucks, and we get stuck with the bill for all of it.  Who ever though a fancy pick up truck could run $40K or more?    

When they tried to total my wife's truck, I discovered the (deployed) air bags drove the repair cost way over the (used) fair market value.  I said fine, leave the air bags out of the repair, we don't want them.  They looked at me like I was from another planet..... and I guess I am. (PS, the air bags didn't save her, the seat belt did, the bags just gave her a black eye and a stiff neck)

If I created a list of all the things I don't need and don't want to pay for in a new car, no one would build it.  But I'm sure they'd find it amusing.