Has Ducati’s Success Flat-Lined?

02/27/2015 @ 4:12 pm, by Jensen Beeler47 COMMENTS

ducati-1299-panigale

The saying goes that one time is a fluke, two times is a coincidence, but three times…three times is a trend. Looking at Ducati’s last three years of sales (2012-2014), which spans only a 2% margin of growth, by definition one has to conclude that the Italian company is experiencing sales stagnation.

Granted each of the last three years have been record years for the Italian motorcycle company’s sales figures, but each year has been a nudging over the last, seemingly at the cost of Ducati dealers who have found more and more inventory on their showroom floors.

But it shouldn’t surprise Ducati followers to hear the recent departure of Cristiano Silei, Ducati’s now-former Vice President of Sales and Marketing. With Ducati seemingly hitting a wall on expansion and model diversity, Silei’s departure may have been expected in some circles, and certainly all eyes will be on his successor Andrea Buzzoni, to see what he can do with the role.

Is all of this a sign that Ducati has lost its magic, seemingly during the leadership transition from Gabriele del Torchio to Claudio Domenicali? Or is there growth to be had from the Italian brand, now that it is owned by Audi AG? We examine that thought in more detail, after the jump.

2011 – 42,200 Total Units – 16.6% Growth

The last full-year of Ducati’s ownership by Investindustrial et al, 2011 was also Ducati’s last full-year with Gabriele del Torchio at the helm of the Italian motorcycle company. Additionally, 2011 was the first year that Ducati broke 40,000 units since the recession, if not for the first time ever.

The big motorcycle release this year was the Ducati Diavel, with an “EVO” update coming to the Monster 1100 as well. The Diavel gave Ducati a 16.6% sales bump, continuing the previous year’s growth of 5%, where Ducati unveiled the popular and new Multistrada 1200 platform.

While 2012 would post larger total sales numbers, I would argue that it is here where Ducati hits its zenith, which should come as little surprise since it’s the same point in time that the Italians were shopping their company to German automakers. Buy low, sell high.

2012 – 44,102 Total Units – 4.5% Growth

In April of this year, Audi (through Lamborghini) officially purchased Ducati for € 747 million, and Domenicali was officially tapped to replace Del Torchio. By this point in time, the year’s new models had already been shown to the public, and were starting to hit dealerships around the world.

Posting 4.5% growth for 2012, it should surprise no one that the cause of this growth was the starlet that is the Ducati 1199 Panigale. The Ducati Streetfighter 848 also debuted this year, though it was responsible for significantly fewer sales.

Ducati’s sales strategy up to this point in time had been simple: introduce one completely new model each year, which pushed into segments that the Italian brand did not have a serious interest before hand, and include several model updates to keep the older models fresh in the eyes of consumers.

This is evidenced by the Hypermotard, Multistrada, and Diavel three-step big-unveil combo that brought Ducati into the 40,000 unit figure, and the constant slew of “EVO” models that accompanied them.

With this process now finally looping back on the aging Superbike line — Ducati’s bread and butter line for over a decade — in 2012 — we see the company hitting its last growth spurt with the debut of the Panigale, which reaffirmed the Bologna brand’s commitment to its Superbike roots.

2013 – 44,287 Total Units – 0.4% Growth

With the passing of the leadership baton now cemented, 2013 is the first full year of Ducati’s ownership by Audi AG, as well as Domenicali’s first full-year at the helm of the Bologna brand.

Post-recession, this is Ducati’s weakest model year lineup, with the Italian company’s “new” models being the water-cooled Hypermotard, with its Hyperstrada variant (along with the forgettable Diavel Strada model) as well.

A segment that historically has not been a strong seller for Ducati, it should surprise no one that the Hypermotard 821 didn’t move the needle for Bologna.

Perhaps knowing that the Hypermotard would gain only as much fanfare as its predecessor, Bologna also released the Ducati 1199 Panigale R, which was the first production machine from Ducati to cross the 200hp barrier (with its included race exhaust).

While certainly catching the fancy of Ducatisti, the high-priced Panigale R did little to contribute to overall sales. With no bold new bike coming from Borgo Panigale, a sales leader doesn’t materialize for this year, a Ducati sales are left stale.

The talk of 2013 though is the Ducati 899 Panigale, which debuted in September of thatyear and was ready for dealers before 2014 could arrive.

Conspiracy theorists would likely be right in their theory that Ducati released the 899 so late in the year as to keep the company’s positive growth trend alive on its sales, as the middleweight superbike model surely is the reason that Ducati’s sales growth stayed in the black for 2013.

Had Bologna not pushed the 899 out the door so quickly, 2014 would surely have looked like a stronger year (it only got a boost of say a thousand units from the 899) than it did with some of those sales going in the fall/winter of 2013.

2014 – 45,100 Total Units – 2% Growth

Instead the big growth models for Ducati  in 2014 were the Monster 821 (released mid-year) and the Monster 1200 — which took the multi-model air-cooled Monster line into the realm of liquid cooling, and outside the realm of a sub-$10,000 motorcycles.

The Ducati Monster 1200 covers an overlap shared by the Monster 1100 and the Streetfighter 1098, while the Monster 821 remained the company’s “entry-level” machine.

As the sales show, neither bike pushed the needle very far, which may have something to do with the fact that Ducati was shrinking the Monster line from three models to two, not to mention finally killing off the Streetfighter 1098 line. Replacing these four machines, with only two models.

That ploy might have worked for Ducati, and helped boost revenue, but the water-cooled Monsters were found to be lacking a certain je ne sais quoi that the old Monsters had in spades. Their reception by the buying public was tepid, which may or may not be surprising considering the warm welcome they got in the mainstream press.

Surprisingly, accounting for more than half of Ducati’s sales growth in 2014 was the release of the Ducati 1199 Superleggera. Said to be the pet project of Ducati’s CEO himself, the Superleggera had the added benefit of pushing 500 easy sales out through the Ducati dealer network…at quite the premium.

500 units may not sound like much in the grand scheme of things, but in a year that grew by only 800 units for Ducati, the Superleggera was a game-changer and gave the Italian company another much-needed year of positive sales.

Unfortunately as MV Agusta has shown, you can only release so many “special edition” machines before the buying public becomes tired of the gimmick, and sees nothing special in your special edition models.

2015 & Onward

With the Superleggera one of the most expensive motorcycles to come from Borgo Panigale, it’s not until this year that we see Ducati introduce a proper “budget” motorcycle back into its lineup — something that would be appropriate for a new rider to purchase.

The Ducati Scrambler is of course the model I am talking about, and despite the machines heavy hipster marketing machine, its appeal has spread to veteran and new riders, men and women, and even millennials and boomers.

Ducati has big hopes for the Scrambler, internally expecting a 20% overall sales increase, courtesy of the machine. Aiding that figure is the all-new 2015 Ducati Multistrada, which debuts the Desmodromic Variable Timing (DVT), along with a refreshed Diavel, not to mention the updated and newly named Ducati 1299 Panigale superbike line.

Updating its star performers to keep them relevant in increasingly competitive segments is a strong move by Ducati, but the addition of the Scrambler is perhaps the company’s masterstroke, and the first sign of life from the Domenicali regime.

Add into the fact that Ducati looks capable of competing at the front of the World Superbike Championship, and that there are signs of righting the ship in the MotoGP Championship, and Ducati is finally looking on-track again — no pun intended.

What will come after 2015 though will be the real determiner for Domenicali and his Audi overlords. The likely sign is that we will see more Scrambler models, with various engine sizes, continuing to come forth — likely not from Borgo Panigale, but from Thailand.

Lifestyle selling will be key, as the current Scrambler models produce almost no profit for Ducati and its dealers. Instead, Bologna hopes that the apparel and customization parts, which carry high-margins, will fill the revenue void, with the Scrambler acting as a sort of loss-leader.

The hardest transition for Ducati of course will be the realization that its home market is growing increasingly irrelevant. North America is now Ducati’s largest market, and the growth for the Ducati brand is clearly in Asia and South America.

To reach BMW numbers, something which is surely the intent of Audi AG, Ducati will have to look past its own nationalism, and evaluate the motorcycle market on a global scale.

This means models specific for regions like the USA, Southeast Asia, India, and South America. This also means targeting those markets with dedicated resources. And, this means prioritizing foreign markets over Italy, including at press launches, where Italian journalists outnumber the rest of the world 2:1.

It will be interesting to see what fruits 2015 bares for Ducati, and what Domenicali’s plan for the company looks like in a post-recession, post-Del Torchio, Audi-owned world.

Photo: Ducati