Teased, delayed, and dismayed, fans of the Empulse should be able finally to get their hands on the Brammo Empulse in 2012, as the Oregonian company has been busy finalizing the Empulse’s design and technical specifications for its street bike release. Rumored to incorporate the six-speed SMRE-designed integrated electric transmission (IET) found on the Brammo Engage and Brammo Encite, a video has cropped-up that shows a test mule Brammo Empulse with the IET gearbox fitted to it. Naturally one of the testing requirements is a fat parking lot burnout.
Well, 2011 as a year is finally over, and for the motorcycling community it was quite a year. As we begin 2012, we here at Asphalt & Rubber are of course not immune to the desire to summarize and highlight the passing of 2011. So we accordingly assembled 11 of the most important events that shaped motorcycling this past year and changed the way the sport, the industry, and the community will grow in the years to come.
Picking only eleven moments in a single year is no easy feat, though some of the events in our selection are obvious choices because of their magnitude. However, some of the less obvious picks (and we are sure there will be suggestions for alternatives in the comments), stem from the theory that 2011 saw moments whose importance has yet to be fully appreciated at this point in time. Enjoy and a Happy New Year to our loyal A&R readers.
After being courted by several major OEMs according to our sources, electric motorcycle manufacturer Brammo received a minority investment by Polaris Industries today. The move will give Polaris access to Brammo’s proprietary electric powertrain technology, and positions the large OEM to enter further into the electric motorcycle market as a strategic partner to the Oregonian company. In the process of this investment, Brammo has also closed a $28 million Series B round of funding that also included contributions from repeat investor Alpine Energy and first-time Brammo investor NorthPort Investments, LLC.
Polaris has already been aggressively expanding into new market segments this year by buying both Indian Motorcycles and electric car manufacturer GEM. Polaris’s investment in Brammo, the two companies will form a strategic partnership that will presumably see Brammo’s electric drivetrain in different Polaris Industry products, which gives the American company a formidable ally in the move to electric-powered vehicles. For Brammo, the news bodes well as it not only means an infusion of fresh capital, a roadmap to further funding, and a step closer to a possible exit, but Polaris will also be sharing its vast array of technical, sales, and support knowledge to the electric startup.
Polaris has just released its third quarter figures, with the American brand reporting a 23% increase ($35.6 million) in sales revenue for the months of July, August, and September when compared to the same time period last year. Those Q3 numbers continue the company’s upward trend this year, as year-to-date (YTD) sales for Polaris, when compared 2010, are up 37% overall ($111.4 million).
While sales have risen across all of Polaris’s market segments, its on-road vehicle segment, specifically its Victory Motorcycles line, has lead the growth for the company. With Q3 sales up 77%, and YTD sales up 83%, Polaris has been making strides against a market that has seen a massive decline from its Japanese competitors.
Indian Motorcycle has released some photos of the first 2012 Indian Chief to roll out of the company’s Spirit Lake, Iowa plant — the first motorcycle to be produced by the oldest American motorcycle company since its acquisition by Polaris. Nicknamed the “Polaris-Indian Bike #1,” the new Chief is not terribly different from the 2011 Indian Chiefs built under the old regieme, but it does symbolize the next chapter in the iconic company’s history.
Polaris has been the company on the move in 2011, and its second quarter earnings show why. Gobbling up Indian and then later GEM, Polaris has shown that it has an appetite for growth, which has been fueled by its strong sales, which have increased in revenue by 41% over Q2 2010. Perhaps more impressive is that the American company has parlayed that increase in revenue into a 90% increase in net income over the same time period, which has been a boon for the company’s shareholders and a testament to the company’s reduced-cost structures.
Polaris is recalling 840 Victory Cross Country motorcycles made from January 1, 2011 through April 11, 2011 for faulty handlebar clamps/risers that may have been improperly machined. Because of the defect, the handlebars may slip in the clamps, resulting in a lack of control over the motorcycle.
Accordingly, Polaris will be notifying affected owners, and Victory dealers will test and replace the defective parts free of charge. The recall is expected to start in June of this year, and concerned Victory Cross Country owners can contact Victory customer service at 1-888-704-5290. The NHTSA, as always, is also available at 1-888-327-4236 or safercar.gov.
Zero Motorcycles has quietly announced some interesting news: that Mark Blackwell, V.P. of Motorcycles at Polaris Industries, will be joining the electric motorcycle company’s Board of Directors. With a plethora of reasons as to why an industry veteran like Blackwell would join Zero’s board, it’s been no secret that the Scotts Valley company has been collecting seasoned industry professionals like pokemon characters, seemingly building a brain trust of people who actually know how to run a motorcycle company.
Blackwell’s addition to Zero is interesting because it could signal a relationship with the Polaris V.P. that goes beyond merely an advisory/visionary position, which is the core responsibility of a companies board. The timing is interesting as well, as Polaris has been on a buying spree, first acquiring the original American motorcycle company brand: Indian Motorcycles, and a few days later electric car manufacturer GEM. With a Polaris executive sitting on Zero’s board almost immediately after these aquisitions, one has to wonder if this isn’t a precursor to some sort of larger arrangement between the two companies.
Polaris released some interesting info this past week to its stockholders, perhaps the highlight of which was how the Minnesota-based company views its acquisition of the Indian Motorcycle brand. Disclosing a brief summary of its plans, it’s clear that Polaris aims to go after the heavy-cruiser segment with a two-pronged approach, much in the same manner as we postulated back on Wednesday after news of the acquisition broke.
More important than stroking our own egos, two pieces of interesting insight came from Polaris’s SEC filing 8-K filing. First was a glimpse into what the purchasing price of Indian could be, as a slide to investors shows Indian’s 2010 revenue as being $11 million, which would peg a baseline asking price of about $9 million, though the perceived brand value could raise that price. The second juicy morsel is how Polaris sees Indian fitting in with Victory, showing the potential of tripling Polaris’s motorcycle sales in the future.
Before yesterday afternoon, I had a hard time getting excited about Polaris. I think they make snowmobiles…but I’m not sure. This is how engaged with their brands I was, but of course this has all changed with the news that Polaris Industries, Inc. has acquired Indian Motorcycle for still undisclosed terms. Covering the business strategy side of motorcycling for the past two and a half years, I can tell you that there are few moves or decisions that strike me as truly inspired, but that events of the past 24 hours are surly Mensa-worthy.
Before I can talk about Polaris and Indian, I have to talk about another motorcycle company: Harley-Davidson. Kingdoms are fated to topple, but looking at Harley-Davdion and its dominance in the American motorcycle scene, let alone in popular culture, the legacy of the Milwaukee company seems assured to endure the test of time. So many companies have tried to be the next Harley, and all of their failures reinforce that concept that no company does “Harley” better than Harley-Davidson. Virtually creating the the legacy cruiser segment, and Harley-Davidson’s success in this regard is also the double-edged sword that is slowly prostrating the Milwaukee brand.
If I had to give one piece of advice to a company wanting to compete with Harley-Davidson, it would be real simple: don’t. Seemingly at the risk of painting itself into a corner, Harley-Davidson has refined its marketing message so thoroughly that it has honed in on a particular type of rider, and exhibits such a distinct persona of motorcycling that the company’s identity has found itself heading full-speed down a one-way street of branding. Thus the low-hanging fruit of competing with Harley-Davidson is to go after the brand where it cannot go.