Archive for March, 2010

Consumers Loosening Purse Strings

March 30, 2010

Some Reasons for Optimism this Selling Season

Good news for retailers in today’s Wall Street Journal: personal spending in February rose 0.3% from the month before, the fifth consecutive month it has climbed. That’s pretty interesting for three reasons:

  1. February had plenty of really bad weather in many major markets across the East and South, enough to keep many shoppers at home;
  2. Personal income was flat from the previous month so consumers didn’t have any extra money to use for shopping, and
  3. Consumers have reduced the amount they are stuffing into savings accounts, perhaps giving them more money to use for discretionary spending.

Consumers were spending at an annual rate of 3.1% in 1Q, according to the WSJ, the strongest pace since 1Q of 2007. The report says consumers are spending money on big ticket items, such as furniture.

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Don J. Brown: In Memory

March 25, 2010

Thursday, March 25, 2010

The motorcycle industry has lost its oldest, dearest analyst. Don J. Brown, whose work spanned decades, died yesterday at home. He was 80 years old.

Don’s full biography can be found (where else?) at the website of the AMA Hall of Fame. I just want to share a few personal reflections.

For the past few years I’ve edited Don’s pages in Dealernews: “State-by-Statement” and “ATV/Dirtbike-by-State” — in which he predicted, by state, how many units dealers would retail that year — and “DJB Composite Index,” his by-brand national predictions for the year.

By-brand is the key word. Because of Don, our magazine has been a dealer’s only source for annual retail sales of all the major brands. Some companies like Harley-Davidson divulge retail sales in their financials, but not many. And we’ve had them all. (more…)

2010 Multistrada 1200 Fever — Ducati Austin

March 25, 2010

These days you can’t swing a dead cat without hitting one story or another about the 2010 Ducati Multistrada 1200 and we here at Dealernewsblog don’t want to be left out of the loop. After all, who doesn’t want to get hit by a dead cat?

Our pal Robert Pandya passed along some cool videos of Ducati North America’s Jeff Brooks giving a tech talk about the new bike to a group of committed Ducatisti at Ducati Austin. According to Pandya, close to 50 hardcore Multistradisti (is that a word?) lined up on a Sunday morning to get the low downistsi on the amazing tech and specs of this cool new ride-isti. (Remember 150hp!) Let’s just end the stupidity here and move onto the videos. Thank’s Robert!

Ducati Austin 2010 Multistrada tech talk Pt1

Ducati Austin 2010 Multistrada tech talk Pt2

Harley Stock Fever Cools

March 18, 2010

Who is Kohlberg Kravis Roberts & Co. (KKR)?

Investors continued to trade Harley-Davidson (NYSE: HOG) stock in heavier volume than normal on St. Patrick’s Day, but the activity was down sharply from Tuesday’s very heavy activity.

HOG shares were off .17 Tuesday from Wednesday’s close of 28.35 on volume of 4,4558,600 shares, down from Wednesday’s huge volume of 18.4 million. Average daily trading volume over the last three months is 3.6 million shares.

Tuesday’s heavy trading pushed the stock up 1.85 or 7%, but it failed to break the 52-week high of 30.00. The 52-week low is 11.20.

Today’s mid-day trading was in the 28.40 range.

The feeding frenzy was started by rumors that Harley was going to be purchased by Kohlberg Kravis Roberts & Co. (KKR), a huge New York-based private equity firm that specializes in leveraged buyouts (LBO). The international firm, founded in 1976, has more than $50 billion under management and reports it has completed more than $400 billion worth of LBOs.

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Harley Sale Rumors Flying

March 16, 2010

Is Harley-Davidson about to be sold? Could be, because anything is for sale at the right price, but so far the talk is nothing but rumors, and at least one respected securities analyst doesn’t think it’s going to happen.

“In our opinion, any such buyout is highly unlikely ” says Tim Conder of Wells Fargo Securities. “We believe the new management team is highly focused on executing the restructuring of the company. If anything is potentially developing near-term, we believe it could be the company forging a joint venture or fee type of arrangement with a depository institution partner as it relates to HDFS.”

However, HOG shares rose more than 5% to $28.02 today on unsubstantiated rumors the motorcycle maker is the target of a leveraged buyout.

Private-equity firm Kohlberg Kravis Roberts was named as a possible buyer. Officials from KKR and Harley both declined to comment on the rumor.

Trading was three times the normal volume in Harley shares as investors looked for a bargain.

Harley reported a loss of $218.7 million in the fourth quarter. And its new management team has moved aggressively to make changes at the American icon motorcycle company, including dumping two of its motorcycle operations, Buell and MV Agusta. JD

Contact me with story ideas or news tips at 952/893-6976 or jdelmont@dealernews.com.

Officials: Importer Used Fake CARB Certificates

March 15, 2010

One of Largest U.S. Importers of Chinese Machines Is Charged

Two top executives of one of the largest importers of Chinese and Taiwanese powersports equipment in the U.S. have been charged by California authorities with selling vehicles that did not meet that state’s emission standards, according to the complaint obtained by Dealernews.

Kening N. Ma, president and owner, and Shirley Hyunae Ji, vice president, of Goldenvale, Inc., were charged last week in a 70-count complaint. The complaint, filed in San Bernardino, Calif., Superior Court, charges the two executives and “another person or persons” with selling motor vehicles that had not been certified by the California Air Resources Board (CARB) to consumers and dealers in California.

The complaint charges the executives with multiple felony counts of grand theft of personal property (more than $400), possession of false certificates, and money laundering involving more than $448,000.

The complaint said that Ma had, and used, certificates known to be “false, altered, forged, and counterfeited.”

According to industry estimates, Goldenvale was one of the top two or three importers and retailers of Chinese and Taiwanese powersports equipment during the last several years.

Goldenvale is a diversified importer that operates facilities in Ontario, Calif, and Dallas, Texas. It imports several powersports machines, including ATVs, dirtbikes, scooters and karts. The powersports units were sold online and through a network of dealers under the Roketa brand.

The company also imported many other items, ranging from artwork and blankets, to  toys and cooking utensils.

Specific sales figures are not available from the closely held company, but import data and industry analysts believe that Goldenvale imported nearly 80,000 units in 2008. But that number dropped off sharply to only about 2,000 units last year as the company attempted to deal with a large unsold inventory of machines.

The company had big years in 2006, according to industry estimates, when it retailed nearly 50,000 ATVs, and again in 2008 when it retailed almost 50,000 scooters. Those numbers put Goldenvale in the top three importers/distributors of Chinese/Taiwanese ATVs in 2006 and scooters in 2008.

Last week’s arrests were the result of an investigation that took several years, dating back as far as 2005, according to court records. The investigation was a joint effort of CARB and the San Bernardino’s district attorney’s office.  JD

Contact me with story ideas and news tips at 952/893-6876 or
at jdelmont@dealernews.com.

Importers of Chinese Motorcycles, ATVs Arrested

March 14, 2010

Pair Charged With 70 Felonies; Certification Violations

Two top executives at Goldenvale Inc., a diversified California importer of powersports products, have been arrested and charged with illegally importing motorcycles, ATVs and other vehicles from China and selling the units in California without proper state certification.

Goldenvale president and owner Kening N. Ma and vice president Shirley Hyunae Ji were charged in a 70-count criminal complaint that includes conspiracy to commit theft, grand theft, and money laundering.

The pair were arrested last week, according to a published report in the San Bernardinto Sun newspaper.

The powersports products sold under the Roketa brand also include scooters, go-karts and other gas and electric-powered vehicles.  The company, which operates facilities in Ontario, Calif., and Dallas, Texas, also imports items ranging from artwork and blankets to toys and cooking utensils. The company imported fewer than 2,000 powersports units last year, according to industry estimates.

The powersports units were sold on-line and through a national dealer network.

Prosecutors said dozens of victims purchased vehicles from Goldenvale that were not certified by the California Air Resources Board (CARB), the newspaper reported. The amount paid by victims ranged from several hundred dollars up to $4,000 for each vehicle, prosecutors said.

The vehicles are illegal to operate in California if they do not have CARB certification.

Ma and Ji are named in a complaint filed in San Bernardino Superior Court. Ma faces one count of conspiracy, 33 counts of grand theft, 30 counts of possessing a false or blank vehicle registration and six counts of money laundering, according to court records.

Ji is named in the counts alleging conspiracy, grand theft and money laundering.

The certificates of origin allow consumers to register their vehicles with the California Department of Motor Vehicles.

In this case, the certificates of origin show a manufacturer name that did not manufacture the vehicles, according to the newspaper. The vehicles also were never certified by CAB, according to the newspaper report.

These arrests culminated a multi-year investigation of illegal activities, according to one CARB official.  JD

Contact me with story ideas or news tips. You may reach me at
952/893-6876 or jdelmont@dealernews.com

Polaris Shares $10 Million With Employees

March 5, 2010

28 Straight Years of Profit Sharing

How would you like to pick up a tidy check today for say, oh,  $4,500. That’s four thousand five hundred dollars. In addition to your regular paycheck. You could do just that if you were working at Polaris Industries, based in suburban Minneapolis.

While much of the U.S. powersports industry is struggling to recover from last year’s poor performance, Polaris is continuing an annual tradition of sharing profits with its employees.

Today, the company is handing out nearly $10 million of its profits from the 2009 calendar year among approximately 2,200 hourly and non-salaried Polaris employees. On average, each of these employees will receive nearly 15% of their annual pay base.

In addition, Polaris will distribute profit-sharing payments to each of its full time salaried employees today as well.

“Profit-sharing is something that is very important and fundamental to the culture at Polaris,” said Scott Wine, CEO.

Polaris began sharing its profits with employees in 1982 and has shared more than $200 million with its hourly and non-salaried employees since that time.

Polaris had 2009 sales of $1.6 billion and recorded net income for the year of $ 101.0 million .

For more information on Polaris, visit its website www.polarisindustries.com.  JD

Contact me with story ideas and news tips at 952/893-6876 or jdelmont@dealernews.com.

Stopping Internet-Phone Use In Your Dealership

March 4, 2010

Or Can You Make That Phone Habit Work For You?
Some Retailers Have. Here’s The Story.

It was the second day of a 20 Group meeting and the discussion turned to employee cell phone use. It was one of the hottest topics of the weekend.

“How can I stop my employees from spending so much time on their cell phones during working hours?” one asked. “They’re on the Internet all the time.” The question struck a nerve, and the discussion was off an running.

The consensus: Internet phone use in dealerships is out of control and there doesn’t seem to be any easy way to stop it. But do we really want to stop it? Using that ingrained habit has proved profitable for some retail operations like yours.

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Proposed Rules Could Severely Restrict UTV Use

March 4, 2010

We have until March 15 to comment on these
CPSC rules that could virtually ban UTVs.

Have you commented yet? If not, you should.

Here are the details.

The CPSC’s proposed mandatory standards spell out how off-road vehicles must be designed, manufactured and used by riders. Meanwhile, at the same time that the CPSC is pushing its rules, the industry has been developing its own voluntary standards.

Paul Vitrano

If you think government mandated standards will benefit our industry, then you don’t have to do anything. If, however, you think perhaps the industry can produce more effective standards, now is the time to step up and make your thoughts known.

A unit of the MIC, the Recreational Off-Highway Vehicle Association (ROHVA), has created new tools for riders and dealers to easily submit comments. You can do it at http://www.rohva.org/anpr.

The sample letters urge CPSC to work with ROHVA to implement voluntary standards and to promote the safety rules for ROVs, also called SXS or UTV units. The page also contains explanations of ROHVA’s position on ROV standards and links to important documents.

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