Friday, October 23, 2009

Life V. Lifestyle

Over the years, I have seen many references to the “motorcycle lifestyle,” a term most strongly associated with the V-Twin universe. I deliberately use the noun ‘motorcycle,’ instead of the verb, ‘motorcycling,’ because what I have seen referred to is considerably more of a state of mind than a state of action.

The term immediately calls to mind all the stereotypical signifiers and tribal signs that stretch back to Hollister and “The Wild Ones”: bandannas and black leather, shortie helmets plastered with bellicose slogans (or no helmets at all) mirrored shades, ape-hangered choppers, highway pegs, engineer boots, wallets on chains and patch-bedecked denim vests. Also: “Trailer queens,” V-twin branded pickup trucks with nary a bike in sight, manly tattoos, t-shirts tautly stretching bald eagle-and-furling-flag motifs across ample pale bellies, et cetera, et cetera. The very embodiment of the phenomenon, the fount from which it flows, the alpha-and-omega of the "motorcycle lifestyle" is, of course, the company that created it from whole cloth, Harley-Davidson USA, of Milwaukee, Minnesota.

But worldwide, the motorcycle industry has fallen on hard times. Despite 2008's four-dollar-plus-a gallon gasoline, motorcycles sales are down drastically except for scooters, which are not perceived quite the same way as motorcycles by the general public. In a period of economic downturn, consumers view motorcycles as a luxury—not as practical transportation—that can (and must) be dispensed with, even disposed of. They are non-performing depreciating asset in the worst sense, right up there with jet-skis, bass boats, and all other manner of man-toys that might seem justifiable in flush times, but are surely the most extravagant and expendable of luxuries when things get tough.

A generation ago, HD, the very embodiment of rugged American individualism was dragged from its deathbed (where it had been driven by a succession of clueless management teams) through massive intervention by the Federal government. This meant years of onerous tariffs on large-displacement Asian motorcycles, and it allowed the company some breathing room while it focused on its notorious and long-standing quality control and reliability issues.

HD pulled itself together admirably (truly, it was a B-school case-study in good management) and it watched its market share climb from year-to-year as it overcame its bad reputation. HD tapped into a growing market of affluent middle-class Americans (The notorious, and reviled "RUBBIES"—"Rich Urban Bikers") who were looking for a little adventure, looking to make a slightly rebellious statement. HD understood what people wanted, and gave it to them—in spades.

But having committed itself wholly to this marketing approach, HD finds itself on the skids once again, without a simple government life-support solution in sight. By focusing on fulfilling a mid-life-crisis driven fantasy rather than meeting a real-world need, HD painted itself into a corner. Overall, the decline in HD sales is less severe than that of the world-wide motorcycle industry in general. But in order to maintain sales volumes and dealership expansions in a market that was approaching saturation, as well as to grab some of that housing-bubble cash, HD undertook aggressive financing strategies that equated exactly to the subprime mortgages.

When the collapsing housing bubble began destroying equity, HD found itself the owner of a large fleet of defaulted-on and rapidly depreciating motorcycles. Repossessions became a dime-a-dozen, and painfully depressed the market for new and used motorcycles across the board; the market has yet to recover, and likely will not improve until well into 2010.

HD’s stock price has been plummeting over the last year, it has laid off thousands of employees, shelved plans for a new North American factory, and this week it stunned the motorcycling world by announcing it is pulling the plug on Buell immediately, and seeking a buyer for MVAgusta, which it acquired barely fifteen months ago.

Buell had been HD’s hope and lifeline since 1983 (around the time of the tariffs) serving first as a captive market for HD’s V-Twin engines, then as a subsidiary of HD serving a younger, more sporting market. Buell was to HD as Saturn was to be for GM: a new, nimble, progressive company built from scratch from the ground up with a fresh approach, sharing some corporate DNA but injecting new ideas into the corporate body.

Eric Buell, the eponymous founder, is an enthusiast and iconoclast—a Steve Jobs for the motorcycle world—and Buell Motors may rise again, a phoenix from HD’s ashes. Unfortunately, despite their differences, Buell inherited many of its parent’s shortcomings, and if it lives on, it will be as a boutique manufacturer, selling to a niche market of enthusiasts. Right now the one thing Buell and Saturn have in common is a very uncertain future, dragged down by their moribund corporate parents.

In hindsight, I imagine HD regrets having spent the last two-and-a-half decades building motorcycles for a lifestyle (n.) instead of for motorcycling (v.). But it's too late to change; what has been done cannot be undone. We may be on the cusp of losing two of America's great motorcycle marques in one fell swoop.


I forgot to mention “HOG,” (“Harley Owners Group”) to my knowledge still the only factory-supported enthusiasts club in the motorcycling world.

BMW enthusiasts have two major unaffiliated groups to choose from in the United States alone: BMW Motorcyclists of America (BMWMOA) perceived to be an ally of BMW North America, and the BMW Rider’s Association (BMWRA) which has historically tended to be more openly critical of BMWNA and more skeptical in general. There are countless other local, regional and specialty BMW clubs in addition to the two national groups, all entirely unaffiliated with BMW or BMW of North America.

The irony is that while the two major BMW clubs refer to themselves as “Motorcyclists” and “Riders,” the Harley group refers to themselves simply as “owners” —no doubt to preserve the ‘Hog’ acronym, but a revealing insight, none the less.

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