Dealers Closing

[zoom45]

I went to a local dealer today and they have added Honda and are still expanding (Victory, Honda, Yamaha, Kawasaki, Suzuki, HTM and maybe others). The only other Yamaha and Honda dealers closed the doors. There is a Suzuki and a Kawasaki dealer in town but their attitude makes you not want to go in the door plus they never have many bikes. There is another super size dealer about 90 miles away. Funny thing though, they never post a price on the bikes. They say the prices change so often thats all they would do all day is change price tags. They told me the first Kawasaki Voyager is due in next month.
Zoom45

[pagemastr]

In Central Ohio we lost one dealer who handled a few brands on the North side, but it was good riddance to them and I can't say that one was a function of our economy, they just didn't seem to care!

One Yamaha shop closed down but was bought out by Iron Pony, a MC gear outlet store (www.ironpony.com). A Harley store up North seems to be doing well, can't speak for the others except for where I got mine South of me, they are in a brand new facility... hope they stick around for a while!

Sort of a mixed bag around here!

[coacha]

The Kawasaki dealer in Brooksville, FL closed down before Christmas. All our local dealerships seem to be doing ok, although the HD dealership in Crystal River has laid off about 8-10 workers in the past month, one who is a friend of mine.

[Top Cat]

I was at a Kawasaki dealer and a Honda dealer last week. Both dealerships had prices on every bike in the place.

[kenb]

I could see motorcycle (powersports) superstores that carry every major brand opening up. Phoenix has one. It would make customer service a priority. And you can compare models in minutes instead of hours/days. empty circuit city stores could be good venues.

[cactusjack]

Originally Posted by KenBob

I could see motorcycle (powersports) superstores that carry every major brand opening up. Phoenix has one. It would make customer service a priority. And you can compare models in minutes instead of hours/days. empty circuit city stores could be good venues.

We do? Do you know the name of it?

[glassgod]

Originally Posted by KenBob

I could see motorcycle (powersports) superstores that carry every major brand opening up. Phoenix has one. It would make customer service a priority. And you can compare models in minutes instead of hours/days. empty circuit city stores could be good venues.

Ridenow Powersports
(480) 503-3333
3333 N Arizona Ave, Chandler, AZ 85225 Map it | Get directions Cross Streets: Near the intersection of N Arizona Ave and W Chilton Dr/E Chilton Dr
www.ridenow.com

[cactusjack]

Originally Posted by glassgod

Ridenow Powersports
(480) 503-3333
3333 N Arizona Ave, Chandler, AZ 85225 Map it | Get directions Cross Streets: Near the intersection of N Arizona Ave and W Chilton Dr/E Chilton Dr
www.ridenow.com

I wouldn't buy anything from them. They used to be Town & Country Motorsports until Ridenow bought them. They sell Honda, Suzuki, Yamaha and Polaris, I think.

I bought my previous bike from them. After the sale it was one bad experience after another.

[barrynfla]

Originally Posted by CoachA

The Kawasaki dealer in Brooksville, FL closed down before Christmas. All our local dealerships seem to be doing ok, although the HD dealership in Crystal River has laid off about 8-10 workers in the past month, one who is a friend of mine.

Coach.......are you talking about WFO Kawasaki? I took my 900 there for new tires and some other stuff last fall and liked them a lot. I really don't care for Motorsports of Tampa. High prices, for sure.

[coacha]

If that was the name of it on 50 west of Brooksville, that was what I was told.

[ells]

CJ, You sure through cold water on that one.

There are several multiple brand dealers around here, not all makes but three, four or more. Thought that it was common elsewhere.

[bruce]

My kind of thread! I love chatting about the industry and business!

Re: Multi-line dealerships; As of about 8 ~ 10 years ago Honda is no longer opening up any new multi-line franchises. Only existing multi-line stores will be allowed to stay open so the owners of these dealerships are sitting on their retirement money! If the existing business is sold then Honda has no recourse, but if the business closes, all bets are off! Yamaha followed suit a few years ago, but I've already seen cases where they made an exception based on business models, location, etc.

Re: The ticking time bomb of the local franchised dealership; I don't make many friends in the industry when I talk like this, but hey, I just call it like I see it. I feel like we will see some pretty significant numbers of shops closing over the next year to 18 months, depending upon the recovery of the economy and loosening of credit.

Industry sales were on a rocket ship ride for about 13~15 years with figures going up at phenomenal rates until around 2005. During that time about all you had to do to make money in the business was show up in the morning and turn the lights on. Because of that the OEM's opened up dealership after dealership and became less and less particular about who they chose to represent them. In fact, they began to lean away from enthusiast owners and the mom & pop store and changed the basic requirements of ownership to the point that only the very well funded need apply. Which meant that a lot people that didn't know which end of the bike the handlebars went on started running motorcycle shops. I've had the very distinct "pleasure" of working for two dealerships that were owned and operated by some real rubes.

For the last... ohhhh, 15 years lets call it, cruisers and ATVs fed us, and honestly ATVs led the way. But some funny things have been happening in that segment of the market. For one thing the land use issues and irresponsible riders are hurting the sport, but the funny thing is, so is the demand for bigger and badder ATVs. Now I'm not trying to be ugly here, just honest. It's tough to get an ATV financed. Real tough. Over the last few years ATVs have been growing bigger with larger and more powerful engines...and price tags. Most lending institutions really only look at the person applying for the loan and not at the machines supposed value. They tend to feel that if the loan is defaulted on the machine probably won't be worth whats owed on it, if they can even find it. For the most part these things were being financed with home equity loans, but obviously that isn't happening much these days... Combine all this with the influx of the cheap throw away Korean, Taiwanese, etc units and you have a very declining market. In my area sales are down almost 40%. Then figure in the loss of accompanying accessories, parts and service and the impact felt at the dealership level is huge.

Cruisers are an interesting phenomenon too. Unit sales were steady as were the sale of accessories, clothing, parts and service items. But while sales were brisk it was obvious that most of these folks didn't ride a whole lot. Which is fine, I mean do what makes you happy, but as the economy slowed these seldom used units found their way onto the used bike market. The increase in available clean units dropped their value and put less demand on new units. On the flip side of the coin many of the cruiser folks turned into hard core enthusiasts and riders and because of that there has been a shift in demand from mid sized bikes to the larger machines. tourers and sport tourers. But while these figures and numbers are interesting they are also relatively small in comparison. The gas price spikes last year did see a huge increase in the demand and sales of small displacement bikes and scooters. Man oh man, we were selling the new 250 Ninjas as fast as we could get them! But we couldn't get them! As fuel prices went down so did the demand for these bikes. In fact we're already seeing slightly used ones on the market and getting calls from people wanting to sell them back to us. Industry pundits predicted that most of these new riders would become enthusiasts and steady customers and I hope they're right. I'm not trying to be pessimistic here but I feel like that we'll be lucky if 10% ever buy another bike. Of course the economy and credit crunch has taken a toll on the street market too, but it isn't as drastic as the ATV market.

What has shocked me is the UTV market. I'd have never dreamed they would be as popular as they are. Most of the time these units are sold with lots of accessories and add ons as well. For the most part the buyers of these units seem to be unaffected or moderately effected by the economy, and the ratio in sales of work to play units is running pretty much 50/50. But in light of the CPSIA rulings concerning lead and the kids units as well as the hub-bub concerning the senator/congressman or whatever that tried to stop a rolling over Rhino by sticking his leg out makes me think that these units may find themselves on the wrong end of the legislation stick before too long. Even if they don't I am reminded of the PWC market in it's growth and customer base, so it is reasonable to consider that like PWCs this market will probably tank in 3~5 years.

Where does this leave us? Honestly if there are fewer shops then market share goes up for those strong enough to survive it. Will the strong be the big super stores like say the Ride Now chain or will it be the smaller shops that return to their enthusiasts roots and focus on customer service?

I've laid my bet...

[foztex]

The dealers in Lubbock TX appear to be doing ok. I've had good experiences with the service dept. at Family Power Sports of Lubbock. Beware of the service dept. at the Yamaha dealership in Waynesville MO (by FT Wood) visible from I-44.