Author Topic: Harley takes a nosedive and cuts Buell and MV Augusta (Read 5963 times)

andy750 · « **on:** October 15, 2009, 08:20:00 AM »

http://www.marketwatch.com/story/harley-posts-84-profit-drop-shuts-down-buell-2009-10-15

"Harley profit drops 84%; Buell shut down"

Harley-Davidson Inc. shares shrugged off early declines Thursday after the motorcycle giant reported a steep drop in third-quarter profit and said it will cut its Buell and MV Agusta brands."

And more from Erik Buell himself...

http://www.buell.com/en_us/

MacM2010 · « **Reply #1 on:** October 15, 2009, 08:29:04 AM »

Yowza, that Buell video is heartbreaking... He looks terrible, a truly defeated man.

I never even liked Buells, but now I want to go buy one just to try and cheer the poor guy up.

Duke McDukiedook · « **Reply #2 on:** October 15, 2009, 08:48:48 AM »

Huh, so they cut the only good things about Harley, what a shame.

Inigo Montoya · « **Reply #3 on:** October 15, 2009, 09:00:57 AM »

Figures hd would do something like this. Instead of cutting back on the tractor model they have, they dump off the bikes that can run on the world stage. If hd cut back on half their fat boys and other crap, then there would be room for buell and mv.

azuredesign · « **Reply #4 on:** October 15, 2009, 09:07:49 AM »

Yeah, it appears fairly desperate on Harleys part as their profits appear down 84% this year. Maybe a good thing for MV, sucks for Buell. Eric Buell seems to be a very smart guy though, and I wouldn't be surprised if he shows up in the near future making bikes again.

MCRider · « **Reply #5 on:** October 15, 2009, 09:16:15 AM »

Quote from: Inigo Montoya on October 15, 2009, 09:00:57 AM

Figures hd would do something like this. Instead of cutting back on the tractor model they have, they dump off the bikes that can run on the world stage. If hd cut back on half their fat boys and other crap, then there would be room for buell and mv.

I have trouble with that. They can't cut the bread and butter to save the jam.

Buell was never a money maker for them. It was just away to assuage their egos in that they weren't able to resurrect the core as performance (like the Sportster in the 50s). So they bot Buell since he would at least use their engines.

MV was a performance marque also. But the hard core HD riders couldn't care less about Buell and MV. Just the guys in corporate who want to see nice things about HD performance even if it was vicarious.

If they cut half the fatboys and other crap, they would be completely out of business.

My sentiments are with you, but they did what they had to do. I don't see any way they can even survive, HD that is. My anecdotal evidence is that the bulk of these boomer, mid life crisis purchases were made with home equity loans. That source of funding has dried completely up. Another down quarter and they'll be canniblaizing the core.

BIKE · « **Reply #6 on:** October 15, 2009, 09:21:28 AM »

I have an issue with Harley in regards to Buell, when I look at Triumph, they have done a pretty good job with their sport bikes over the last 1/2 decade. I'm not sure why my expecations of Harley/Buell can't be similar to that of Triumph.

Inigo Montoya · « **Reply #7 on:** October 15, 2009, 09:40:54 AM »

Quote

They can't cut the bread and butter to save the jam

Sure they can! Haven't you ever had a pbj without the crust!

MacM2010 · « **Reply #8 on:** October 15, 2009, 09:42:23 AM »

Here's my idea of the best case scenario: Harley realizes that their old market share is gone, and the only people who are going to buy their bikes are people who actually care about motorcycles, and want something that performs. So, they hire a despondent Erik Buell to work on designs, and a smaller number of better bikes are available. Then, fifteen years from now, people will be saying "Man, I wish Harley would stop making this [current fad] crap and make bikes like they did in 2011 again."

It could happen, right?

Steve F · « **Reply #9 on:** October 15, 2009, 09:48:03 AM »

Sounds to me that Eric Buell now has a means to sever the ties with Harley and finally get to work on a decent bike without Harley's fingers in the pie and telling him what he must do and cannot do.

simon#42 · « **Reply #10 on:** October 15, 2009, 10:04:39 AM »

the buell video is as macm2010 said heartbreaking , but the saying is 'you cant keep a good man down ' and i expect to see eric buell back where he belongs , making motorbikes that try to set trends rather than follow them .

MCRider · « **Reply #11 on:** October 15, 2009, 10:07:05 AM »

Quote from: Dead Bound on October 15, 2009, 09:32:18 AM

http://www.cnbc.com/id/28998181

Warren Buffet bought in for $300 million in February at $13. The stock has doubled since then. Its was at $48 before everyone started stuffing their money in the mattresses. They are doing fine.

Its just that hard core HD riders aren't going to buy a Buell or MV (which they do not even sell in LA). Even the V-rod is a stretch for them. They probably make more money off sportsters than Buells. The all black sportsters (Nightster) are nice.

Warren bot unsecured notesin the HD finance unit. He negotiated a 15% annual return. That means HD has to lend the money out at higher rates to turn a profit, or take it in the rear to sell product. He invests in and buys companies in ways we never could. He did not buy the stock in this press release. (though he may own some I don't know)

This is a desparation move on Harley's part indicating they can't get better financing somewhere else.

The stock is up twice from its lows, but its still down 50% from its highs. This is just normal give and take in a falling market. People are gambling in the stock market right now. Based on current and projected earnings the stock is worth about $10. The company is still profitable, and if they move fast enough they may keep it that way.

Warrens money went into the finance unit, to finance purchases as the prior funding method of home equity loans ihas dried up.

I love the guy, but as he will remind us, the original Berkshire Hathaway was a textile company, was of Warren's first purchases. It went bankrupt three years later. Warren kept the name to remind him he can make mistakes..

Bob Wessner · « **Reply #12 on:** October 15, 2009, 10:39:10 AM »

Quote from: MCRider on October 15, 2009, 10:07:05 AM

People are gambling in the stock market right now.

Just as with GM. Believe it or not, some were 'buying' GM stock right up to their fully expected entry into bankruptcy.

MCRider · « **Reply #13 on:** October 15, 2009, 10:47:11 AM »

Quote from: Bob Wessner on October 15, 2009, 10:39:10 AM

Quote from: MCRider on October 15, 2009, 10:07:05 AM
People are gambling in the stock market right now.

Just as with GM. Believe it or not, some were 'buying' GM stock right up to their fully expected entry into bankruptcy.

GM stock STILL TRADES under the symbol MTLQQ.PK as the "Motors Liquidation Company". Type "GM" in your quote button. It's about 65 cents, been as high as 1.25 (almost a double) and as low as 25 cents. Pure gambling. Should be $0

Trades 17 million shares a day, as much as Apple Computer!

Bob Wessner · « **Reply #14 on:** October 15, 2009, 10:49:25 AM »

Quote

Type "GM" in your quote button.

No thanks, trading to me is akin to gambling, might as well go to the casino.

Duke McDukiedook · « **Reply #15 on:** October 15, 2009, 11:04:54 AM »

It is worse than gambling, there is no way when you gamble all your money at the casino that the government will bail you out for your money lost and more! And give yourself a big, fat bonus in the process!!

BobbyR · « **Reply #16 on:** October 15, 2009, 11:07:01 AM »

Harley has a niche market, and they are one trick pony. They know you can either buy a Harley or a Harley clone. Each time they step out of their niche it fails.

The V rod is a nice bike, but the hardcore HD people don't like it. They are in a bad spot, but they have no way to go. If they made a Sportbike the Japanese and Europeans have street cred in that market and it would fail. They are painted into a corner with small twins and cruisers. Buell and Agusta could hook up with Honda, Kawasaki etc and maybe make a go of it.

Ford took all of the safety technology from Volvo and styling from Jaguar and moved it into their Lincoln Mercury lines. The AWD system in my Lincolns are from Mazda. I am not rich, I have family that owns several different Dealerships so I lease them cheap.

The Japanese might be able to leverage that marriage. Problem is their economy is in the crapper and not from the mortgage mess. They have the largest population over 65 and a negative birthrate. The kids are not buying into the 14 hour work day thing either.

Ecosse · « **Reply #17 on:** October 15, 2009, 11:21:56 AM »

god, buell looks awful! why do i get the feeling i'm looking at a gm scenario replay? just before they sold their soul to unkle sam they had an embarrassing amount of suvs and such. then nobody wanted them it seemed when gas jumped to 4 bucks and the economy took a dive. i know it's more complex than that but i'm not too off base.

what happens to hd if the big fat road pillow market deflates? all harley has is their sportster sport bike.

mr. buell is down but not gone. as said before maybe being free from hd is a good thing in the long run but i know buell had emotional ties to them. as for mv i think someone with deep pockets will fish them out of the abyss.

thanks for the heads up andy.

Raul CB750K1 · « **Reply #18 on:** October 15, 2009, 01:51:05 PM »

These are though times. They would just stop producing MV Agusta and Buell bikes and surely they will resume production when the good times come again. It is pointless to make bikes that won't sell and will remain in the warehouse.

The brand name is an asset in itself. Anytime they badge a bike with either of those names, it will sell regardless of where it has been manufactured.

mlinder · « **Reply #19 on:** October 15, 2009, 01:56:55 PM »

If they just had Augusta make some bikes, slap the hardly davidson moniker on em, and sell em here in the states as an 'american' motorcycle, maybe they'd sell.

RatBikeRandy · « **Reply #20 on:** October 15, 2009, 03:39:42 PM »

This is really sad. A truly American motorcycle that had a lot of interesting features an some character. I've met several interesting folks that ride Buells like last October in the N. GA mtns at a Buell gathering and campout.

The Buells that I have test-ridden have been FUN to ride but would probably cost a license. I hate it for Erik Buell.

tramp · « **Reply #21 on:** October 15, 2009, 05:05:17 PM »

all the old folk own harleys
why buy another
they lost thier market
something had to give

bucky katt · « **Reply #22 on:** October 15, 2009, 05:07:14 PM »

funny, theres an article about the new harleys and a buell or 2 in the new cycle world. one of the new buells uses a rotax motor.

CaféElite · « **Reply #23 on:** October 15, 2009, 07:45:00 PM »

So not sweeting this... It appears HD is creating a tangible asset so they can sell (thank god) which shouldnt be an issue considering the value of Buell jumped a lot over last year. Im just hoping that someone good picks them up.. I wouldnt be suprised if Victory trys to snag it which I think would be a good home for Buell.

I think this will have a huge back lash on HD in the log run. One of their main goals is to try and start attracting the sub 34 year olds and this is the wrong way to go about it.

The thing that chokes me up about this is watching the vid of Erik Buell on buell.com. Here is a guy that built a motorcycle from the ground up because of passion.. not for girls.. not to be a ubber millionair but because he saw something missing in current bikes from major manufacturers.. passion and character is something a buell provides its owners in hand fulls.... or a twist of the throttle.

While the 1125 engine is manufactured by rotax it is a new design that was driven by buell for buell. While im a huge fan of the thumper engine Erik knew he had to get into a light, powerfull liquid cooled engine. Sad thing is you will never see me in public on a 1125 because of those nasty pod filters..... not saying I wouldnt take it out at night on the back roads and flog it. It is damn quick and nice handling bike for only being two years old.

I ride a 06 XB9 Lightning and if all goes as planned I will pick up a 06/07 XB12 lightning next year. I have road a decent amount of bikes but none have been as FUN to ride as the lightning. There is no better daily rider for the city then the lightning. Im excited for a Buell shop that does not reside in the same building as HD....

I will steal anyones side covers that disagrees with me

grumburg · « **Reply #24 on:** October 15, 2009, 08:09:37 PM »

Doesn't seem Harley can stray far from their core with much success. Aermacchi in the 60s-70s, Holiday Rambler in the 80s, now Buell and MV. All bought when at the top and sold or closed at the bottom. Could they have really had their heart in MV if they are bailing after 1 year?

News:

Author Topic: Harley takes a nosedive and cuts Buell and MV Augusta (Read 5963 times)