Motorcycle Overview December 2019

Politics are getting a bit tiresome lately, it is taking up valuable time for many businesses trying to plan ahead. It is rightly or wrongly being blamed for falling business, although in association with others things including a global slowing it is fair to say it does have some effect, but recently California Superbike School has gone into liquidation and must be a first in the motorcycling industry directly blaming Brexit. Dependent on which part of the month you read this, we are getting or already have a new Government, but even if there is a clear majority it will not be the end of the disruptions.

New Market

October registration figures from the MCIA are showing overall numbers reducing by 1.8% to 7,126, 133 less than the same time last year. It is a small amount that should not be ringing alarms bells at the moment and the year to date is still positive to the tune of 1,888 (2%) on 96,409. Motorcycles had the biggest hit and Scooters a good month with an increase, adding 153 more than 2018. Mopeds numbers continue the increase they have enjoyed recently by adding 23.6%, although not massive numbers at 581. Around the sectors there are a few big ups and downs, some of which are going against the Y-T-D changes. Adventure having a poor month even with the help of the best-selling in class this month, Ténéré 700 stock arriving, but after large numbers of GS being registered in previous months, perhaps not surprising. The class is 6.6% up on last year for the first ten months. Custom balked the yearly -7.9% trend with 20% more going on the roads in October.

October 2019 and Year to Date - New Registrations by Style

Mopeds	Registrations		%	Market Share (%)		Year to date		YTD	Market Share (%)
	Oct-19	Oct-18	Change	Oct-19	Oct-18	2019	2018	% Change	2019	2018
Scooter	452	363	24.5%	77.8%	77.2%	4,224	3,760	12.3%	78.7%	81.6%
Other	129	107	20.6%	22.2%	22.8%	1,141	849	34.4%	21.3%	18.4%
Totals	581	470	23.6%	100.0%	100.0%	5,365	4,609	16.4%	100.0%	100.0%

In the engine size returns the larger (651cc) capacities had a miserable month with the worst loss seen in the 651-1000cc range, which also is having the same problems over the year, so should come as no shock. Smaller capacities are faring better with the previously mentioned sub 50cc Moped class the best.

October 2019 and Year to Date - New Registrations by Engine Band

Engine Band	Registrations		%	Market Share (%)		Year to date		YTD	Market Share (%)
	Oct-19	Oct-18	Change	Oct-19	Oct-18	2019	2018	% Change	2019	2018
0-50cc	646	487	32.6%	9.1%	6.7%	5,754	4,806	19.7%	6.0%	5.1%
51-125cc	2,666	2,632	1.3%	37.4%	36.3%	29,993	29,660	1.1%	31.1%	31.4%
126-650cc	1,456	1,391	4.7%	20.4%	19.2%	20,136	17,755	13.4%	20.9%	18.8%
651-1000cc	1,233	1,599	-22.9%	17.3%	22.0%	21,366	23,004	-7.1%	22.2%	24.3%
Over 1000cc	1,125	1,150	-2.2%	15.8%	15.8%	19,160	19,298	-0.7%	19.9%	20.4%
Total Registrations	7,126	7,259	-1.8%	100.0%	100.0%	96,409	94,523	2.0%	100.0%	100.0%

With the exception of the Top-ten brand table with Honda as usual in first place, when was the last time there were none of the brands models making a showing in the top model sales? It must be a while.

October 2019 and Year to Date - Highest Registering Model by Style

Mopeds	Highest Registering Model by style	Oct-19
Scooter	Lexmoto ECHO 50	85
Other	Lexmoto ASPIRE 50 TD 50 Q-2	25

Motorcycles	Highest Registering Model by style	Oct-19
Adventure Sport	Yamaha TENERE 700	115
Custom	Harley-Davidson LOW RIDER S 1868	42
Naked	Royal Enfield INTERCEPTOR INT 650	136
Scooter	Yamaha NMAX 125	247
Sport/Tour	BMW R 1250 RS	45
Supersport	Lexmoto LXR 125 SY 125-10	90
Touring	BMW R 1250 RT	31
TRAIL/ENDURO	KTM 250 EXC TPI	36

Tricycles	Highest Registering Model by style	Oct-19
SCOOTER	Piaggio MP3 300 HPE	19
OTHER	Piaggio APE CLASSIC 400	4

October 2019 - Highest Registering Model by Engine Size

Engine Band	Highest Registering Model by Engine Band	Oct-19
0-50cc	Lexmoto ECHO 50	85
51-125cc	Yamaha NMAX 125	247
126-650cc	Royal Enfield INTERCEPTOR INT 650	136
651-1000cc	Yamaha TENERE 700	115
Over 1000cc	BMW R 1250 GS ADVENTURE	78

October 2019 - New Registrations by Brand

Major Brands	Oct-19
Honda	1,224
Yamaha	820
Lexmoto	668
KTM	437
BMW	431
Triumph	404
Harley-Davidson	374
Kawasaki	311
Piaggio	265
Royal Enfield	245

Used Market

It’s that time of year and the feedback from the trade is no different to virtually every other year, there are signs of customers still buying and from some dealer’s even signs of improvement from last month. There is talk - where cash flow allows - that next season is already being prepared for by sourcing stock while it is at its lowest price. As interest in stock starts pick up the inevitable happens and prices at least stop the recent slide downwards and possibly even start to recover. Dealer research is suggesting there are no major corrections required and this edition has only seen a few minor movements, generally.

Auctions

At the penultimate sale of Black Horse bikes took place in this research period, it is a good indicator to use in conjunction with the dealer sentiment as to any change in the willingness to find stock. The industry buyers go to auctions to buy stock, so perhaps the halls are the first place to look for the low buying price dip to change direction and that is exactly what happened. Buyers stated they are buying for next year and the attendance was up. Prices were also up, driven by a couple of large group buyers flexing their check books. As has been the case for many months now, there was a large amount of PCP handbacks in the sale, the mix was better though, with large numbers of one model that have caused concerns being present in much smaller numbers. As these oversupplied models start to thin out after the initial rush to register them is now several months in the past, the price starts to stabilise and there is a low enough number for several dealers to show interest. The three year mark from the introduction of Thruxton 1200 R is now recent history and the price hit over 2019 appear to have halted and this is how other models in the past have performed. The corrections in pricing and the worse performing models now beginning to recover, coupled with next season stock search it has had the effect of increasing auction results closer to the reported figures in this product. Although still slightly “behind book”, there has been a recovery to 95% of CAP which if taking purchase fees are factored in are getting very close to each other again. 139 from 176 entries sold, as usual all the Black Horse found new homes and even the sometimes struggling BMW entries having a better time, with close to half selling.

End Notes

Electric power is continuing to make news in the two wheeled world and at the recent EICMA show Kawasaki is the latest to display its electric motorcycle project. Kawasaki has apparently been working on the technology since the early 2000s. The difference to the others we see in the electric motorcycle market though, is chain drive and a four-speed gearbox. Perhaps an easier sell to current riders who want more than the twist and go experience.

Continuing the green theme and onto another city trying to clean things up. Bristol is set to become the country’s first city to ban diesel cars from entering parts of the city centre in a bid to cut air pollution. The City Council has agreed to ban privately owned diesel cars from a central zone between 07:00 and 15:00. Commercial vehicles will pay to enter the area. Waiting for government approval the plan is to start in 2021. There is no mention of motorcycles as yet, but there are not many diesel ones to ban. And there lies the problem, no mention and certainly no promotion of two-wheeled transport. Less space in overcrowded roads and less emissions, what’s not to like?

And in similar news a French study revealed that motorcycles emit up to eleven times more carbon monoxide and six times more nitrogen oxide than cars because new motorcycles ‘only’ have to be in compliance with the Euro 4-norm whereas cars need the Euro 6-rating and on the back of this the Belgium government are looking to ban motorcycles from the streets of the capital in a bid to cut emissions! The government’s environmental department is to carry out a detailed study on the amount of fine dust and greenhouse gases produced by motorcycles in the next year. Then they will decide if certain low-emissions areas of the city should prohibit powered two-wheelers. Strange that most believe motorcycles are not only better for the environment in terms of emissions released into the atmosphere, but also help in other ways like easing congestion and sitting stationary in traffic for less time. It has been proven that daily traffic jams could be reduced by 40% if only 10% of drivers would choose a motorcycle instead of a car.

At the Tokyo Motor Show, Honda has set out its vision for an electrified future across its motorcycle business by developing a range of models with swappable battery capability. Although the Japanese giant used the show to focus on the launch of the new Honda Jazz small car, it did dedicate a large portion of its presentation on an electrification plan across its entire product range, after all they are the largest motorcycle manufacturer in the world. Honda’s electric project is developing new concepts designed to make electric transportation more seamless and convenient, with a 2030 deadline set for Honda to electrify two-thirds of its car range. Honda’s motorcycle range is developing batteries that can be swapped out and replaced quickly and easily when they are running low, but as with most big two-wheel manufacturers, there are no specific dates involved  due to the costs involved in development and the profit margins not making a good business case. It is apparent that globally and not just Honda sees the climate benefit a second place concern to profit at the moment.

Barcelona has the most motorcycles per capita than anywhere else in Europe, so it makes sense for the VW owned SEAT car company to develop in collaboration with Barcelona-based electric motorcycle maker Silence, an electric scooter for both private customers and sharing services. The 125-equivalent has an official launch for the Barcelona Smart City Expo World Congress as part of the company’s urban mobility strategy, which focuses on offering sustainable solutions for cities.

Norton Motorcycles have launched a crowdfunding campaign in a bid to secure £1m funding they plan to use to help increase production of its V4 and 650 model ranges. After ten years of trying it would be nice for the UK motorcycle industry for the brand to move from the niche hand built low volume business model and flying the flag by increasing the line up to go to a larger world market. The most recent accounts from the 12-months to March 2018 showed they had a turnover of £6.7m and made a pre-tax profit of £20,721. This is after making a loss the previous year.

The Piaggio Group has shown a 3.1% rise in motorcycles sales during the first three-quarters of 2019. To the end of September the Piaggio Group including motorcycles, commercial vehicles and mobility projects had a 2.1% year-on-year growth but it was the motorcycle/scooter range that performed best. Their motorcycle brands sales totalling 321,900 units. In the continental scooter market they had a 24.3% market share and similar in North America. Vespa performed well with a 9% rise in sales as its electric models begin to find a larger European audience. MP3 three-wheeler was also mentioned in dispatches as the original and leader in the three-wheeler scooter market and demonstrated double digit growth in 2019.

Mahindra has gone from a majority (51%) stake in Peugeot Scooters to a full-on buyout of the French, predominantly car producing PSA Group. Apparently at the moment although a production move to India to save on higher running costs, they are trying to keep the brands presence in Europe and see it as key to its growth plans and intends increasing the market share.

Yet again Suzuki Motor Corporation’s motorcycle business has suffered in the first half of its 2019/2020 fiscal year from April to September. Global sales volume grew 2.1% to 876,000 bikes and ATVs in the period, but revenue only increased by just 0.2% (to £901m) and operating profit crashed by 56.8% (to £12.4m). Poor performance in developed export markets took most of the blame with European volume 7.1% down (to 26,000), associated revenue down by 3.4% (to £140.3 and North American sales remaining level at 21,000 machines but revenue slipping by 5.4% (to £100.4m). Emerging Asian markets proved a better hunting ground for the company with total volume across Asia up 3.6% (to 718,000 bikes) and overall revenue increasing by 0.3% (to £462m). In India, despite the economic downturn in the country, with their domestic manufacturers suffering, Suzuki have seen volume rise by 14.9% (to 339,000) and revenue was up by 13.3% (to £224.4m). The star of the Suzuki show was in the Philippines increasing the volume by 16.1%, (to 101,000) but overall this was washed out by China falling by 16.8% (to 163,000).

Ducati’s first nine months of the year saw sales drop negligibly by 0.3% (to 43,827) worldwide, but revenue was 5.3% down (to £489m) and the positive was operating profit remaining level at £34m.

Unlike Suzuki, India’s economic downturn and weakness in other major Asian markets have a bad effect on Honda. Global revenue for the first six months of their financial year was 3.5% down (to £7.565bn), associated operating profit down a sizable 16.7% (to £1.058bn) and operating margin again a decline of 14% from 16.2%. Shipment volume dropped by 6.1% (to 10.019m, down 648,000). Indian sales were 18.7% down at (2.68m) with the manufacturer blaming shrinking demand and exacerbated by more onerous consumer credit restrictions. But other Asian countries were also tough for the brand with Thailand down 9.6% (to 669,000), Indonesia 1.3% down (to 2.437 m) and Vietnam a small decrease of 0.5% (to 1.311m). In total overall Asian sales reduced by 7.4% (to 8.953m). A more positive elsewhere with other regions including Latin America up 9.2% (to 664,000), European sales still (at 141,000) and their domestic market growing by 7.7% (to 112,000). North America performed better than

Well last month saw the finish of the racing season, a sad time of the year for race fans, but also the retirement of five-time World Champion Jorge Lorenzo, perhaps not that much a surprise for some. After 30 years of living the racers life, injuries have caught up with him to stop the ability to ride to his own expectations. At a time arguably with the depth of the field and closeness of racing never seen before, he stood out as a supremely smooth rider rarely failing to entertain the aficionado.

Merry Christmas to one and all.