Is the motorcycle industry dying?
Not quite soo fast. While there has definitely been a trend downwards, the motorcycle market is not dead, just changing drastically. There have been losses in certain segments and gains in others.
Overall, Harley-Davidson stock has been moving up. The value was pushed up due to increasing Asian sales. The shares are up 15% in 2019 even with the pause on the production of their electric motorcycle. A strong push with the electric motorcycle or less expensive version of the current one could really crack the millennial market for Harley-Davidson.
Indian Motorcycle went bankrupt and stopped producing motorcycles in 2003. They were saved from bankruptcy by Polaris and re-entered the market in 2014.
Harley-Davidson had been expected to take a nosedive because their target market is getting older and younger generations are not as keen on motorcycles and high-end motorcycle purchases. A nice motorcycle that you are likely using as a leisure vehicle is not really within the budgetary constraints of millennials these days.
Despite the failure to entice millennials, and their older customers dying off or not replacing their motorcycles as fast, all is not doom and gloom. Increases in emerging markets have staved off some of the losses from their key demographics. But, they have been facing increased competition from the re-emergence of Indian Motorcycles
It’s easy to say that Harley-Davidson is feeling the burn from Indian Motorcycle, but Indian Motorcycle was all but dead in the water for a while there. Indian Motorcycle went bankrupt and stopped producing motorcycles in 2003. They were saved from bankruptcy by Polaris and re-entered the market in 2014. That’s a long time to be away from the market. Harley-Davidson has stayed steadfast with some hiccups for years. The blip in Indian Motorcycle sales means it’s very easy to read a lot into Indian Motorcycle gaining market share from Harley-Davidson. The likelihood is that they are just re-acquiring their old customers back from Harley-Davidson.
Despite early indications that Indian Motorcycle was gaining, there were soon evident loses. With Indian Motorcycle not being as transparent as Harley-Davidson with their sales, it’s hard to see exactly where Indian Motorcycle stands right now compared to Harley-Davidson.
Some have indicated concerns about Indian Motorcycle sales as they are selling styles that appeal to the older traditional motorcycle rider. That is unlike Harley-Davidson who has moved steadily towards electric motorcycles and younger generations. Indian Motorcycle appears to be focusing on race motorcycles while Harley-Davidson is moving towards lighter city motorcycles. Race motorcycles tend to target a higher income bracket, but are they biting?
Harley-Davidson had been expected to take a nosedive because their target market is getting older and younger generations are not as keen on motorcycles and high-end motorcycle purchases.
Who will come out the winner in these races? Only time will tell. The competition between the two of them at this point really seems to be about cracking that millennial market and how well they can fare in emerging markets. It is extremely unlikely that a Harley-Davidson owner is going to replace their older motorcycle with an Indian Motorcycle and vice versa. Will younger generations turn towards motorcycles, or will both makers have to ride things out until these millennials get older?
It’s easy to say that Harley-Davidson is feeling the burn from Indian Motorcycle, but Indian Motorcycle was all but dead in the water for a while there.
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