Archive for May, 2010

ATK Bets on Harley Dealers for Bike Sales

May 31, 2010

33,000 Bikes Would Be Sold Exclusively Through Harley Stores

Frank White has been working to put together a manufacturing partner with his ATK Motorcycles off-road company for the better part of a year, and it looks as though he’s finally done it. Last week, ATK announced it signed a $100 million manufacturing deal with S&T Motors Co., Ltd., to produce 33,000 motorcycles over the next four years.

The pact calls for S&T to produce the motorcycles at its Korean facilities next year and then begin assembling them at the ATK facility near Salt Lake City after that. S&T Motors is a Korean manufacturer that began developing and selling ATVs, scooters and motorcycles in 1978. Today, it sells powersports equipment under the Hyosung brand around the world, and it expects to generate annual sales in 2011 of $US 300 million, according to its website. It employs about 350 persons. Here is more information on S&T Motors. Make sure you go to the English language page.

Its U.S. distributor, Hyosung Motors, is based in Norcross, Georgia. More information on Hyosung Motors can be found here.

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Here’s Another Excelsior-Henderson Website

May 31, 2010

This One’s Been Up and Running Since 2001

The other day, I wrote about a new website launched by Dan Hanlon and others to preserve the heritage of the Excelsior-Henderson motorcycle mystique. Here is the site, and you can read the post about it here. That posting drew lots of visitors, in part, I’m told, because of the existence of another site, www.superxowners.com, launched about 10 years ago.

Dan Hanlon and his brother, Dave, are founders of the Excelsior-Henderson Motorcycle Manufacturing Company that was based in Belle Plaine, Minn., an hour’s drive south of Minneapolis, and a pleasant bike ride from the home of The Motor Company in Milwaukee.

Nick Trumbo and his son, Trevor, launched and operate the SuperX site. While both sites are remarkably similar in their overall designs, there is one interesting difference: Dan Hanlon runs the new site, while his brother, Dave Hanlon, and Dave’s wife, Jennie, are involved in the Trumbo site.

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BRP Readies Launch of Hot SxS Lineup

May 31, 2010

New Models Could Be Released Within Two Weeks

You can spell the DNA of Canada’s BRP powersports manufacturer as EXCITEMENT. No conservative, working machines for this global OEM based in Valcourt, Quebec. It builds and sells the high performance Ski-Doo snowmobiles, Sea-Doo watercraft, and Can-Am ATVs, and the category building, on-road three-wheel Spyder.

So, when we start talking about BRP launching a line-up of side-by-side machines, we’re not talking about another lawn tractor. We’re talking about something like Polaris‘s very hot RZR UTV. Expect to see the new models from BRP before mid-June.

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Polaris Outperforms May Stock Slump

May 31, 2010

Dow and S&P 500 Decline Sharply

Polaris Industries common stock lost ground in May, but its decline was only about one-third of the ground lost by leading market indicators, and it was much better than two other powersports stocks, Harley-Davidson and Arctic Cat.

Polaris closed May 28, 2010, at $58.70, off $2.35, or 3.8%, from its close on May 3 of $61.05. Polaris stock was given a strong boost on May 24 when analyst Joe Hovorka of Raymond James upgraded his Polaris rating from Market Perform (third level rating) to Strong Buy (top rating).

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Where’s the Anger About Chinese Stealing Ideas?

May 28, 2010

Lack of Response to Federal Investigation Is Puzzling.
Were You Ripped Off? Now Is the Time To Tell Your Story.

EDITOR’S NOTE: Shortly after I posted this story, I heard from my friends at the Motorcycle Industry Council (MIC) regarding a survey they are doing pertaining to the USITC investigation. I want to pass on this information to you, so you can participate, if you wish. The MIC is surveying members and compiling comments on IP infringement. If you’re an MIC member, you can find more information on the MIC survey here. The survey will take only a few minutes to complete. The MIC’s Paul Vitrano told me today that powersports companies are participating and providing data for an industry comment package. “The more responses that we receive,” he says, “the more thorough comments we will be able to submit. For details on the MIC project, contact Scot Begovich (sbegovich@mic.org) or Paul Vitrano (pvitrano@mic.org) or call the MIC at (949) 727-4211.

I’ve been hearing complaints about the Chinese stealing designs and ideas from other manufacturers for years— at EICMA, at Dealer Expo, in private conversations— it’s a topic that never fails to generate comments. Until now.

Now, when the federal government is investigating cases of Chinese companies stealing intellectual property, nobody wants to talk about it. I wrote about the investigation by the U.S. International Trade Commission (USITC) several weeks ago, but there’s been virtually no response from the business community. There’s a public hearing scheduled for June 15, 2010, but there’s been virtually no response from the powersports industry. Zero. None. Read my previous post here.

What’s up? Too busy? Don’t care? Don’t want to get involved? I suppose it doesn’t matter why no one has responded to the USITC’s requests for comments, the only thing that matters is that the commission isn’t getting the information it needs to help solve the problem.

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Polaris Gears Up Off-road Production

May 24, 2010

A story in today’s Wall Street Journal (5/24/2010) outlines the moves that Polaris Industries is making to adjust its short ORV (off-road vehicle) production capabilities to meet the growing demand for off-road vehicles, especially its hot RZR four-passenger model UTV machines. Read WSJ story here.

Bennett Morgan

The story describes Polaris efforts to hike production as dealers moan about lost sales because of inventory shortages. One group of Polaris dealers I contacted reported selling 53 more RZRs through April this year than it did in 2009, 25 of which were four-seaters. “Supply is definitely a problem,” one dealer told me.  “If we’d had another 25 of them to sell, they would have gone too.”

The shortages are a major change for Polaris, which used to be accused of overloading its dealers with inventory. This year, Polaris expects its North American inventories to be the lowest that they’ve been since 1997, reports the Journal, although it doesn’t break out those inventory levels by product line.

Even though low inventories could hurt 2010 wholesale sales, it’s the right strategy, long-term, Scott Wine, Polaris CEO, told the Journal. “It’s a work in progress,” he said.

After reading the Journal report, I checked with Bennett Morgan, Polaris president and COO, about the Polaris inventory situation and its moves to gear up production.

“We are pleased to have had success in working with our dealers over the past few years to bring dealer inventory down to lower, more effective levels,” says Morgan, “and feel pretty good where we are today.” Morgan said the company is “tight” on a few key models, but he said Polaris is “working hard to increase our supply to meet growing demand.” He noted that the sales forecast that Polaris gave to its shareholders for the second  quarter was increased to 14 percent to 17 percent, compared to Q2 2009.

Regarding adjusting its production to meet the increased demand, Morgan said the company “significantly” increased production in the second quarter by adding staff and boosting line rates.

He said production this quarter has been increased by adding back additional second shifts at the plants in Spirit Lake, Iowa,  and Roseau, Minnesota, for off-road products.  “We have added over 200 hourly production line positions in the second quarter already,” Morgan told me today, “and (we) expect to add that many or more in the next 60 days.  We are also working overtime and some Saturdays.”

During the last couple of years, the suburban Minneapolis OEM has made aggressive strides to dump its reputation as a channel stuffer that pushed excess inventory on its overloaded dealers. The company’s innovative ordering system— Maximum Velocity Program— that it launched a couple of years ago, allows dealers to purchase machines every two weeks rather than twice a year.

Something like 70 percent of Polaris dealers are expected to be on the new system this year. That’s close to all of the eligible dealers, because many of Polaris dealers are too small to participate in the program. JD

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

Excelsior-Henderson Website Is Launched

May 24, 2010

Remember the Excelsior-Henderson Motorcycle Manufacturing Company, the exciting Minnesota start-up that burst on the motorcycle OEM scene before going bust in the early 1990s? It was a compelling story about a small group of enthusiasts who challenged the major manufacturers and captured the hearts and minds of riders and investors before running out of cash.

Don’t get me wrong. The company’s not back, as far as I know, but it’s remembered on a new website developed by Dan Hanlon, one of the company’s founders. The website is http://www.excelsiorhenderson.com. You can see it here.

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On the road with Joe Bonnello (aka Joey B’s California Gold)

May 14, 2010

We just got a message and a buncha great photos from everybody’s favorite shorts-clad photographer, Joe Bonnello. Seems Joey B. has been out and about, exploring the nooks and crannies of California, exposing his gams to the far reaches of this great state.

We’d tell more, but Joe agreed to write us an account of his trip to the Quail Motorcycle Gathering in Carmel where he took some shots. Look down for Joe’s words and then keep going to see some of his pics. I like Joe’s style. Damn this makes me want to ride …… 

The Ride. The Show. The Spring!

So it goes like this — May in California is already summer, hot, dry, dusty, brown. But, this year, no!

Cool, damp, g-r-e-e-n. Never happened I say. Gotta ride before the heat. Ride, ride I say. So, got the Cagiva ready. Found out the Quail was happening in Carmel. Got on the bike and headed across the desert to the mountains. Jumped into the twisties and proceeded to find every nasty, twisty, obscure and downright stupid road in California, all the way from Apple Valley to Monterey, and then back. Over Frazier Park. Around Taft. Across the inland mountains to Atascadero. Around the prettiest roads near Paso Robles. Through Hunter Liggett to the coast. Up spectacular PCH to Monterey, then to Carmel for the Quail Motorcycle Gathering.

Lot’s of gorgeous bikes but no Quails in sight. Out over Carmel Valley, the back way around Coalinga (epic!), across the San Joaquin Valley on farm roads, up to the base of the Sierras to Bass Lake. Hook up with Larry Langley and David (more…)

Ask Your Customers This One Question

May 10, 2010

A Simple Way To Measure Customer Satisfaction

Joe Delmont

If you’re like most other business owners, you have fewer customers today than you did two or three years ago. It’s not your fault, that’s just the way it is. The question now is, How well are you serving those fewer customers, when each one is more important than ever?

That brings us to today’s topic: Customer satisfaction surveys. These surveys are great and can provide plenty of valuable information for owners and managers, whether you’re running a bricks and mortar operation, an e-commerce business or an operation that does business in both spots. There are a number of experienced and competent research firms to chose from if you want to develop a full-blown customer satisfaction program. But what if you just want a snapshot; what if that’s all you can afford today?

Here’s my suggestion: Pick up a copy of the “Ultimate Question: Driving Good Profits and True Growth, a book written by Fred Reichheld and published by Harvard Business School Press. Then, consider asking your customers, The Ultimate Question. The approach, developed by Reichheld, is a relatively quick, easy and inexpensive way to find out what your customers are saying about your company, your products and your service. The approach is not perfect, but it could give you a useful snapshot of the way customers think—and talk— about your operation.

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Feds Investigate Chinese IPR Theft

May 7, 2010

Hearing Scheduled for June 15, 2010.
It’s an Opportunity To Tell Your Story.

Another federal agency has joined the battle on Chinese manufacturers who are selling illegal goods in the U.S. First, the Consumer Product Safety Commission (CPSC) took aim at Chinese with its child safety provisions, then the EPA (Environmental Protection Agency) began grabbing containers of Chinese powersports products as they entered U.S. ports looking for emissions violations.

Now the U.S. International Trade Commission (USITC) has launched an investigation into the effects of intellectual property rights (IPR) infringement on the U.S. economy and U.S. jobs. The investigation was requested by the Senate Finance Committee.

The investigation will study violations of copyrights, patents, trademarks, and design registrations.

The ITC  will  publish its findings in two reports. The first will provide a description of the types of reported IPR infringement and China’s related policies on procurement of “indigenous innovation” which could limit the sale of U.S. products within China. This could be of special interest to U.S. companies such as Polaris and Harley-Davidson as they attempt to expand into the Chinese consumer markets.

The second report could be much more explosive. It will describe the size and scope of IPR infringement by Chinese companies and the effect of these actions on U.S. jobs and on the sales and profits of U.S. companies. In addition to Polaris, Harley and Arctic Cat, among others, these companies include U.S. operations of Japanese companies such as Honda, Kawasaki, Suzuki and Yamaha, according to an ITC official.

Depending upon how broadly the ITC wants to define U.S. companies, it could include most powersports companies doing business here, including OEMs such as BRP, KTM, Piaggio and Triumph, as well as aftermarket companies.

The report on types of IPR infringement is due by Nov. 19, 2010, and the second— on the impact of these infringements— is due May 2, 2011.

In requesting the investigation, Committee Chairman Max Baucus (D-Mont.) wrote that more than 80 percent of goods seized at U.S. ports for IPR infringements came from China. He also noted that intellectual property accounts for more than 40 percent of U.S. economic growth.

As part of the investigation, the USITC will hold a public hearing  on June 15, 2010. Written comments also will be accepted. All written submissions, except for confidential business information, will be available for public inspection.

I’ve been hearing for years about how Chinese manufacturers steal designs and produce replicas of popular machines and PG&A items made by U.S.,  Japanese and other manufacturers. Now is your chance to step forward and describe how your products have been illegally copied and how you have been financially injured.

If you’re concerned about dealing with the ITC but want to tell your story, contact me. I can get your information to the ITC.

Here is important information if you wish to submit comments to the ITC:

DATES
June 1, 2010: Deadline for filing requests to appear at the public hearing.
June 3, 2010: Deadline for filing pre-hearing briefs and statements.
June 15, 2010: Public hearing.
June 22, 2010: Deadline for filing post-hearing briefs and statements.
July 9, 2010: Deadline for filing all other written submissions.
Nov. 19, 2010: First report due to the Senate Finance Committee.
May 2, 2011: Second report due to the Senate Finance Committee.

ADDRESSES
All Commission offices, including the Commission’s hearing rooms, are located in the United States International Trade Commission Building
500 E Street SW, Washington, DC.
All written submissions should be addressed to the Secretary, United States International Trade Commission, 500 E Street SW, Washington, DC 20436.

The public record for this investigation may be viewed here.

ADDITIONAL INFORMATION
Project Leaders: Katherine Linton (katherine.linton@usitc.gov or 202-205-3393) and Alexander Hammer (alexander.hammer@usitc.gov or 202-205-3271) or Deputy Project Leader Jeremy Wise (jeremy.wise@usitc.gov or 202-205-3190).
Analyst, John Kitzmiller (John.Kitzmiller@usitc.gov or 202-205-3387).  JD

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