The Motorcycle Industry Was At A Crossroads, Then COIVD-19 Changed Up The Map
2020 has been the sort of year where about once a week, you say to yourself “what just happened?” With soft sales and even negative growth at some companies as the year began, to the spectre of collapse in the face of the coronavirus to sudden sales spikes and even triple-digit growth, it’s been a whiplash year so far for the motorcycle industry, along with some related markets. Indeed, what the heck is happening?
I recently talked at length with long-time motorcycle industry insider and trend watcher Robert Pandya, who heads up a communications agency that has worked with Polaris motorcycle brands Indian and Victory, as well as Piaggio. Recently, he spent time as board member at startup electric motorcycle maker Damon, and has also worked with Strider bicycles and the Progressive-backed International Motorcycle Show, which just recently expanded their scope to include off-road machines in a new effort called IMS Outdoors. He also started the Give A Shift (GAS) organization
dedicated to the future of the motorcycle industry and of course, he has an all-things-motorcycle-industry podcast called Centerstand you should check out. He’s insightful about the state of the sport and passionate about bringing new riders into the fold through Progressive IMS produced programs like Discover the Ride and New To 2. For those already involved, there’s a new online hub at Continue the Ride.
But back to the issues at hand. Prior to the coronavirus outbreak, red flags were waving in many pockets of the motorcycle industry. Harley-Davidson’s woes in terms of sliding sales and a skidding stock stock price are well known, but other bike makers were struggling as well – while a few notables, such as Triumph and Polaris-run Indian, were seeing growth. But in aggregate, there was a growing dark cloud hovering over the industry, generated in large part by one particular problem: Not enough new riders are buying motorcycles and replacing those that are leaving the sport.
A Problem With Many Causes – And Then…
There have been many reasons postulated for the shrinking ridership numbers and flagging sales, from Millennials being more risk (and motorcycle) averse, to smartphone addiction to enthusiasts aging out of the market, and the dreaded “combination of all these factors.” But then, the COVID-19 pandemic hit and something very interesting happened: Motorcycle and bicycle sales Sell your house fast jacksonville started to climb, often at double-digit rates. It made sense on some levels, since anyone returning to work or life in general was avoiding ride share and mass transit like the plague (sorry) and many ex-riders suddenly rediscovered their mothballed two-wheeled conveyances – or decided to buy new ones. Indeed, bicycle and motorcycle repair shops have also been seeing brisk business.
But while the latest boost is good news, can it be sustained? And who is riding all these bikes? “Clearly there are return riders, people who have motorcycles in their garages and maybe they’ve fallen out of registration or they were were just Sunday riders,” Pandya said. As those riders started riding more and needing new gear, that would help account for the sudden uptick in aftermarket business at places like Revilla and Cycle Gear, which sell jackets, gloves, helmets, tires and so forth. Pandya said those businesses and repair shops have had some “exceptional months.” Those fair-weather riders also likely saw their motorcycles as an escape as well as transportation, Pandya surmised, but first they had to get them running and gear up. Helmets, gloves and jackets bring a sense of security while riding – as well as being a wearable physical (and mental) separation from other people.
Motorcycling has always been a bit of a socially distant activity anyway, so it’s not hard to see why casual riders saw their bikes as an escape vehicle from the grinding lockdowns early on in the pandemic. Also, Pandya noted that many cities experienced an unusual phenomenon unseen in decades: literally no vehicle traffic. Indeed, this rider took a crosstown trip one day in April and encountered a normally traffic-jammed Portland bridge completely free of vehicles – in the middle of a work day. It was such a stunning sight I stopped and took a photo:
As people began to return to workplaces, another concern arose: COVID on mass transit. Worldwide, people who had traveled to work in trains, on buses or other mass transit – even ride share vehicles – reconsidered their options. Suddenly, motorcycles, scooters and of course bicycles became not just viable options, but in many peoples’ minds, pretty much the only option for getting around when a car either wasn’t needed, or wasn’t available. “You still got to get there,” Pandya noted.
At the same time, two other factors came into play: weather and new technology. As April rolled into May and northern climes defrosted, many people looked at their dusty bicycles and either got them going again or turned to the latest tech wave disrupting an industry: electric bicycles. Whether pedal assist or something more potent, electric bicycle design, performance, pricing and most importantly, supply, began to gel just as a tidal wave of demand crashed on shore. Bike shops and bike makers reopened to find a public clamoring for their goods and services.
Bicycle makers were also exploring a novel business approach: Direct to consumer sales, known as DTC in industry-speak. While most bicycles require bike shop staffers for assembly, companies like Charge and VanMoof had simplified the assembly process to such a degree that customers who could operate a screwdriver or a hex key could follow simple instructions or some YouTube videos and be up in running in less than half an hour. The pandemic supercharged the DTC idea and the demand.
But will the pandemic transform American cities into copies of Asian metropolises where zillions of scooters and bicycles jockey for space? Pandya says no. Motorcycles are still regarded as recreational vehicles in the U.S., and while the outbreak may have helped some see them in a more utilitarian light, Pandya said he thinks it’s more likely Americans will view motorcycles and scooters as “transpotainment,” a vehicle that does the job of moving people about, but is also a “fun” vehicle and perhaps still a luxury good rather than a necessity. But he also says that very idea is something bike makers should take to heart as it’s an effective sales argument for those perhaps considering a motorbike of any sort. Discounted tolls, free parking (in non-car spaces) and HOV lane access for motorcycles could help drive even more people to give motorcycles a go. And the new crop of electric machines, along with the surge in adult-sized small-displacement motorcycle options give perspective riders more to consider than what has long been the primary market focus in the U.S.: selling large displacement, high-margin motorcycles. That focus is rapidly changing, and at perhaps an inflective moment.
Small Goes Big
One growing trend in the motorcycle market that started to catch fire pre-COVID and continues to remain hot today is the rise of small-displacement but full-sized machines that appeal both to new riders, and are also tempting to experienced riders as well. Motorcycles in the 200-400cc range, such as the Kawasaki Ninja 400, KTM Duke 200, BMW G310GS and Yamaha YZF-R3, which can be ridden with a lower-tier license, barely existed in the bigger-is-always-better American market just a few years ago.
These often very affordable single or twin cylinder machines are finding buyers in the U.S. and worldwide as bike makers pour innovation and better quality components into what used to be regarded as beginner bikes. “Holy cow, there are some great bikes out there now” under 500cc Pandya said, noting that its these machines, along with a new emerging class of often retro-styled 125cc city machines, that are getting the attention of new riders, and often women riders. “Because it’s small and approachable, new riders think they’re awesome,” Pandya said of the new crop of 125s. And since they’re “only” 125cc, and often with niceties such as ABS brakes, fuel injection and triple-digit gas mileage, new riders suddenly aren’t limited to large and outdated used machines or the wheezing 49cc scooters of old that couldn’t get out of their own way.
A modern 125 like the retro-cool Honda Monkey or the more sci-fi Kawasaki Z125 can do an honest 50mph, which is sufficient velocity for safely navigating city surface streets while ruling out freeways. And, they’re a blast to ride. “Many, many buyers want a “real motorcycle,”” and the new crop of sub-400cc bikes are delivering big-bike fun in ways not seen in the past. “Fence sitters are saying “I could handle this. I could ride this,”” Pandya said. One standout about to hit the American market is the Honda CT125 (below), better known as the Trail 125, part of Honda’s suddenly super-hot miniMOTO lineup.
Honda’s simple CT trail bikes from the 1970s were immensely popular back in the day and have a cult-like following, with decent examples often selling for over $3,000 – many times what they were sold for new, if you can find one. The new 125cc version, better in every way than its forebearer, is due in showrooms right about now, and is already in high demand. It features 17-inch wheels, ABS disc brakes, and a ruggedness that makes them perfect for trolling rough city streets, especially in high-use cases like urban delivery services. And while demand for the Trail 125 is already high, “(Honda) should sell these at every RV dealer in America” in order to drive new rider adoption, Pandya said.
Bicycles To Bikes
But Pandya also sees a lot of hope for attracting new motorcycle riders through experience with a more recent technological trend: electric bicycles. As I’ve said in my numerous ebike reviews, electrified bicycles are technically low-powered motorcycles, especially the Class II types that allow for motive power without pedaling. While most are regulated to 20 miles an hour (a solid clip on a bicycle), some can go far faster, as Simon Cowell discovered.
Anyone who put playing cards in their spokes as kid knows it’s a natural progression from bicycle to motorcycle, and motorcycle makers are clearly not oblivious to this, but it still represents a new product and market for them. Motorcycle makers should note that bicycle makers can’t make electric models fast enough these days (in more ways than one), and the segment, along with regular bicycle sales, has seen double and sometimes triple digit growth during the pandemic. Can motorcycle makers capitalize? Pandya thinks they should and could – including at Harley-Davidson and Honda. “This is their opportunity to build that bridge product” that could lead to future motorcycle sales, Pandya said. And if those companies would adopt a DTC approach to marketing and delivery of those bikes, Pandya said the opportunity is right there in front of them.
Indian/Polaris has just introduced an electric FTR model for kids and Harley-Davidson actually sells electric balance bikes for kids on their website (start ‘em young!), and before CEO Matt Levatich left the company earlier this year, full-on electric bicycles were also in the pipeline. Whether that plan continues under new CEO Jochen Zeitz remains to be seen (he has said it will), but other motorcycle makers, such as Ducati and Yamaha, are clearly pushing forward with electric bicycle offerings. Yamaha has been making electric bicycles since the 1990s, but for Asian markets, which readily received them. Pandya thinks Harley-Davidson could take another step to expand out from their core market with electric bicycles, which could then translate into motorcycles sales down the line, and he agrees that time spent on an electric bicycle leads some riders to wonder: What would it be like to level up to a motorcycle? Any motorcycle?
As such, ebikes and Zero electric motorcycles are becoming a fixture at the International Motorcycle Shows, where attendees can ride them on short test tracks as part of the Discover The Ride program. The response has been positive, and Pandya said the bikes are tuned via software to be easy to ride with speeds capped for the short courses. “They are extremely approachable, and easy to control,” Pandya said, and they are also a hit with attendees who may have heard about electric bikes and motorcycles but have not had a chance to try them out. Pandya’s connection to electric bikes goes back many years to his time with Aprilia, which actually launched an ebike called the Enjoy way back in 2004. “It was way before it’s time,” Pandya said. But he also added that he sees a future where electric bicycles and motorcycles share space on motorcycle dealer showroom floors. He said many sales managers share that vision. “We have very fertilized soil right now, let me put it that way,” he said. “It’s on us to plant as many seeds as we [the motorcycle industry] can right now in order to translate that into motorcycle sales and business in this great country.”
Will the sudden high tide of bike and motorcycle sales result in a renaissance for that kind of personal transportation? “We find ourselves in this industry on our heels, and you can look in the rearview mirror all you want,” Pandya told Forbes.com, “but I think the access to technology and design, and our marketing abilities, speaks to this awesome opportunity to go from seven percent [of people riding motorcycles] to eight percent.” Just that small of a rise in ridership could be enough to swing the fortunes and future of the motorcycle industry.
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