View Full Version : Market Trends

03-14-2010, 07:36 PM
I just got my April "Motorcycle Consumer News". Fred Rau's "Contact Patch" column is very interesting this month, and may be related to two threads going in this forum right now: the one about the R1200R, and the new one about faired vs unfaired bikes.

The column concerns industry trends, and the basic thesis is that North America, which was recently and for decades the largest market for single track vehicles, no longer is, and by a wide margin. I'll just quote a couple of lines to give you an idea. This article is not available at the MCN website, but I hope these tidbits will encourage anyone who has not done so to subscribe to this fine publication.

"North America is now third in the world in overall motorcycle sales, lagging behind China and India, and losing ground every day"

"...Last year, Honda's sales in North America dropped by 48%, and yet worldwide, their sales declined by less than 1% from the previous year. That's because their sales in China only dropped 3.5%, and their sales in India increased by 6%."

"... India's total motorcycle sales volume for Honda alone is more than triple their entire sales volume for the US, Canada, and Mexico combined."

"... going by the latest figures, H-D is currently losing $2.4 million per day."

"On July 30, Honda officially produced its last American built motorcycle."

"Sure, we may still be the third largest marketplace for motorcycles, but when you consider that Asia is buying 98.3% of the total output, it puts things in a more logical and understandable perspective."

How does this relate to RT vs R? Or to BMW at all? Here I go out on my own, and please to not assume any intent on my part to put words in Fred Rau's mouth.

It seems to me that if the major motorcycle manufacturers are moving rapidly in the direction of satisfying Third World, or in any case somewhat less affluent markets, then they will move in the direction of smaller, more efficient, more basic bikes intended primarily for transportation as opposed to recreation. Riding long distances will be less of a design concern. Big engines and cutting edge styling will matter less.

I guess, overall, what I'm speculating is that there may come a time when we are all riding smaller, more efficient, more basic bikes.

Maybe BMW will buck the trend. They see themselves as being apart, a niche market now. Perhaps they will go for the wealthy buyer who wants a status symbol, and wants to go long distances. Maybe this will or won't work for them. Maybe they will fall by the wayside. Who knows?

I can't see the future. I will say, though, as an owner of a Suzuki GZ250 as a second bike, there is a large part of me that would welcome more parity with the rest of the world. If I could get an F800R instead of the R1200R I just bought, I probably would have done so. BMW made 250's at one time. Maybe they will again. Maybe they'll get back into the 500cc range. I would welcome that.

There's no doubt that it's more fun to ride an R1200R than a GZ250 on American roads. But I feel better about riding the 250. Do I have a warped or unusual point of view? No doubt! But I have a distinct sense that the world is moving in my direction.

03-14-2010, 08:58 PM
Mr. Geyer,

I am beyond surprised that China and India have only recently surpassed the USA as the world's largest motorcycle markets. Given that the two countries have more than 1/3 of the world's population and that their economies are growing at very rapid rates I would have expected them to have surpassed the USA as the world's leading motorcycle consumers a decade ago.

Having lived and worked in China, Vietnam, Cambodia and the sub-continent for 15 years until 10 months ago, I know a little bit about the growth of the motorcycle markets in those countries. If you break all motorcycle sales down in terms of displacement and/or bike weight, then the 50cc to 110cc market is virtually entirely in the countries mentioned. Sales of bikes over 175cc is virtually non-existent in those countries. Only the children of oligarchs can get permission to buy larger bikes. The number of bikes over 400cc in those countries is statistically insignificant. When you talk about motorcycle sales in Asia versus the USA, or Europe, you are talking about apples and oranges. To quote raw unit sales percentages is meaningless.

Its not likely that the Chinese and Indians are going to be buying other than 110cc Hondas, 110cc bikes licensed by Honda or 110cc Honda Cub rip-offs and imitations made in China, Korea, Taiwan, Vietnam, Cambodia, Malaysia, Thailand and India that sell for as little as $500, brand new.

There isn't a lot of profit per unit in bikes sold in Asia and the sub-continent. I doubt that there is a lot of interest on the part of BMW in that segment of the market. On the other hand, I would be very surprised if BMW Motorrad along with the car division don't have showrooms and sales outlets for their existing line-ups in Beijing and Bangalore however. Ferrari, Porsche, Bentley and other prestige brand auto dealers all have a presence in China and India. There will be much greater upside for expensive motorcycles there that there will be for small cc commuter bikes and scooters here.

BMW is doing better in the US than HD and the Japanese manufacturers because they sell to a different demographic. Hard economic times have hit the rice rocket and stump-puller crowd harder than it has hit the demographic that constitutes BMW Motorrad's market segment. Everybody, including BMW is having to adjust to economic realities, however. In times like these it is only natural that a manufacturer will thin out its offerings and concentrate on the models that it sells the most of. Obviously, the R1200R is not a hot seller at the moment. Some think that BMW will discontinue the model. I surely hope not. I think it's the quintessential BMW in their line-up -- the basic, no-BS, all-around, dependable ride. I have a K1200S but the R1200R is my favorite. If I had to pick between the two, it would be the R1200R, hands down. I'd buy a new R1200R in a jiffy if they bring future models out with the twin cam head. I will never buy another K-bike -- especially not a K1300S.

We BMW owners need to start a new thread, or threads, aimed at letting BMW Motorrad know what we like and don't like about our rides and how we think their offerings can be improved.


2007 R1200R
2008 K1200S
2009 Duc S 1000 Bip.

03-14-2010, 10:02 PM
I don't have the 4/10 MCN yet, but I read enough here to say, I'd bet in 5-10 years the US market will have just hybrid or e-bikes if the trend continues.

03-14-2010, 10:33 PM
I don't have the 4/10 MCN yet, but I read enough here to say, I'd bet in 5-10 years the US market will have just hybrid or e-bikes if the trend continues.

I tend to agree on this. The tightening emission noose will not allow utilitarian 3'd world bikes to be sold in USA. Too bad, because they will be rugged, and easy to service. Future bike hotrod rags will be into increasing amps without weight. The new technological internal combustion bikes will increasingly become the province of the wealthy - this is already happenning.
I went retro with the airheads, because I did not like the ever growing weight, and increasing complexity which required dealer service. If I had not gotten into these, the expense of owning a new bike was becoming a real negative. I suspect older, "dumb" bikes will become an increasingly desirable elite niche.

03-14-2010, 11:25 PM
I don't think BMW is as concerned with what we want as much as what we are willing to buy, and I think they probably spend quite a bit of time pouring over model and sales data, both BMW and other brands, to determine just that. I don't know what has sold well and what has not, I would hazard a guess that the GS type bikes like the R12 and F-series have done quite well - but then again the odd transition from F650 to F650 twin and G650 appears to have been somewhat poorly handled with the G650GS seeeming to have disappeared into the ether (anyone know of anyone who has actually bought one?) It will be very interesting to see how the S1000RR sells, a bike that meets or exceeds the performance and offerings of its direct competition at a reasonably comparable price.

Rather than a wholesale evolution of the type and style of BMW offerings, I think that we will see more of the current linear progression with more component manufacturing "offshore" and perhaps more partial and possibly even full assembly in places like China. In addition, I am betting that BMW might do well with an inexpensive purpose-built bike for China, India and the like, made in China and sporting a sturdy full-sized GS-type frame, absent ABS and other expensive niceties, with something like a bulletproof Rotax-licensed 250 engine (which we would of course all pine for over here...) Who knows, it could even be somewhat of an epiphany for BMW, returning to its "performance matched with simplicity, reliability and durability" roots.

03-14-2010, 11:42 PM
+1 on everything said thus far!

About two years ago I had some correspondence with Dave Searle who is editor in chief of MCN.

I asked why MCN is not paying very much attention to the smaller and more fuel efficient but yet powerful bikes that are across both ponds. The response was that the US populations is not interested in such things.

I bet that will change sooner rather than later.

03-14-2010, 11:45 PM
Oh, and, no, we haven't had any safety (or any other) issues with the Priuses in a combined 170,000 miles or so. And all that idiot had to do was put it in neutral and the engine would have cut out, if the incident was real at all, which seems to be coming into question. Off topic, but someone was bound to ask.

Sorry in advance about thread pollution but I want to comment on this.

I heartily agree with you. Anyone who runs any machine without learning how to shut it down is asking for trouble. I live on a farm with diesel tractors. I'm OK with letting people drive them but I make damn sure they know how to kill the engine because turning off the ignition does nothing.

My suspicion is that somebody got paid off to have the Prius issue.

In closing, I feel very betrayed by Toyota. There is no excuse. I won't buy a new one again, ever.

Trust no one.

03-14-2010, 11:54 PM
FYI, Motorrad Mike, my wife drives a 2008 Nissan Altima Hybrid, which uses the Prius' electric engine, mated to a Nissan 2.5L I-4 engine. It has none of the issues the Prius has, and runs beautifully. The tranny is Nissan's CVT, and the car has a 600-mile range.

I'd never trust Toyota again, and I have little trust in most car and bike manufacturers lately, but so far, all companies are seemingly doing "it" better than Toyota is, so your fear is not unfounded.

03-15-2010, 11:52 PM
I am highly skeptical of the runaway Toyota issues. I remember very well the beating that Audi took over alleged unintended acceleration in their cars. When the dust settled, it was determined to be user error, not vehicle defects. The large volume of claimed unintended acceleration reports came after extensive publicity and a famous faked 60 minutes test.

If you look at the stats, the claims for Toyota unintended acceleration follow the publicity, not the publicity following claims.

Having said that, I probably wouldn't buy a Toyota because they are boring cars. Used BMWs have done well for me.

03-16-2010, 12:17 AM
For years I thought that if Toyota made a motorcycle I would buy one.
Now I am not so sure.
But I would buy a Subaru motorcycle. All wheel drive, boxer. :D

03-16-2010, 12:06 PM
Sorry in advance about thread pollution...
In closing, I feel very betrayed by Toyota. There is no excuse. I won't buy a new one again, ever.

Trust no one.
I've got the same feelings about Ford, after they couldn't find new tires to replace the Firestones on my Explorer. Funny, they still had plenty of tires for their new production.

Failure to build and maintain brand loyalty is going to hurt all manufacturers, and has already hurt the American car industry

03-16-2010, 01:21 PM
I have removed all references to our Priuses from my original post. I shouldn't have mentioned anything about it, this being a motorcycle forum and all.

03-27-2010, 03:27 PM
Trickster I hate to disagree with someone in only my second posting on this forum (just got my new-to-me 08 K1200GT), but you contradicted yourself and left a fact or two out.

First: you see only 110's and 175's over there with a few 400 and 350 size sportbikes mixed in is because in most of those countries the law does not allow anything over 400cc.

Second: I'm pretty sure 98% is a bit of an exageration LOL! I understand that there is a huge disparity but you HAVE to consider profit. A $500 Honda 110 clone has say $50 profit in it. Your average Jap bike has $1000 profit or more, and BMW and Harley even more so. That means even if 95% of the market was small bikes in Asia, it would only make up half the profits, so in reality there is still A LOT more money to be made in Europe and North America, with much less effort. The same applies to the Auto industry I work in. The biggest money makers which exclusively keep them afloat are the most expensive vehicles. They wind up losing money on every small econo-product they make.

Third: while a lot of Asian countries aren't the backwards places they were 20 years ago, you can't in one sentence say that they aren't third world anymore, and In another say a $500 110 motorcycle is the best they could afford for their only source of transportation. this last one of course being more an opinion on my part I guess.

I love a good discussion, and I try not to be to offenseive or a blowhard, so please take it in the spirit of friendly debate!:lurk

Cheers! :beer

P.S. Should I say "Prost!" instead of "Cheers!" now that I'm riding German???

03-27-2010, 03:44 PM
No offence taken,

But I was quoting a previous poster, re: 98%. I have no actual figures myself.

As far as displacement size, again no facts, just opinion.

I still feel very lucky to have the choices and opportunity to make the purchases I do, in regards to my wants.

Yes I probably have left out many facts, but the way "I" see it, to be able to accessorize my ride with "options" that cost more than what "others" can afford to spend on their primary transportation......well......life is very good indeed for me.

03-27-2010, 03:49 PM
:usa AMEN to that Trickster! It is VERY good indeed!:ca

03-27-2010, 07:28 PM
I just hope it lasts! In this economy, who knows?