Will 2012 Finally Be Husqvarna’s Year?

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For the past day I have been plunking away at a spreadsheet, adding in values found in several years’ worth of press releases. You see, while most motorcycle manufacturers go out of their way to hide sales information in their media communications, they still leave enough clues that allow one to decipher these pieces of information in their entirety. A monthly figure here, a quarterly result there, a percent gain over last year mentioned, and you’ve got your self five or more months of sales data extrapolated.

That being said, there is no need to go through this much work to know that Husqvarna has been having a rough couple of years. Even by just taking a straw poll from any of the BMW Group’s many glowing sales reports, you’ll find a three to four sentence paragraph outlining the continued disappointment that the Italian-based Swedish brand has brought the German company. Often not even cracking four-digit monthly sales figures, Husqvarna has been on a sales decline that has spawned BMW Motorrad’s decision to push the once dirt-only brand into the street bike scene.

In its most recent media communication, the BMW Group has praised Husqvarna’s sales success over the past two months. With the subsidiary posting a 50% gain in January, and a 2% gain in February, Husqvarna has thus far this year posted a 15% gain over the first two months of 2011. All is well for Zie Germans, no? You know the setup, continue reading for the take-down.

Just taking a look at Husqvarna’s ongoing yearly sales decline (above), you can see why there is a good business case for the introduction of bikes like the Husqvarna Nuda 900, Husqvarna Strada, and Husqvarna Moab & Husqvarna Baja concepts (in theory at least, I’ll save the execution part for a later commentary). And while it is easy to believe the early 2012 hype that Husqvarna has finally found the rocky bottom of whatever chasm it fell into, if history teaches us anything, a promising first quarter does a yearly sales increase not make.

Part of the reason for the hesitation regarding Husqvarna’s promising 2012 stems from the fact that all of this has happened before, and it will happen again. Posting strong(er) numbers in January and February of 2011, Husqvarna went on to post a 22% decline in sales for the year, which was punctuated with the absolutely horrible second and fourth quarters that were posted by the motorcycle company. Coming into 2012, Husqvarna has once again posted signs of life in the early months, though with less fervor than before, which leads to the question of what the rest of the year will hold for the brand and parent company BMW Motorrad.

If we can assume the same trend of lackluster performance in coming months, Husqvarna’s one saving grace for positive sales growth could well be the Nuda 900. Even with Husqvarna’s limited dealer network, one or two models sold at each dealership in the summer months could easily sway the company from negative to positive sales growth, due mostly in part to Husqvarna’s sub-600 unit monthly sales figures in 2011.

A classic game played in public relations, large percentage gains at low volume numbers are really less impressive than they appear. But even if Husqvarna really can bolster its sales with the Nuda 900, the move could be a bigger financial burden than financial boon to the company. While much has been said about the use of BMW’s F800 motor as the base for Husqvarna’s new 900cc lump, one important factor that has been overlooked with this move by BMW is the relatively low production costs associated with the repurposed engine.

Already produced at volume, the BMW Group has likely absorbed most of the tooling costs associated with the F800 series, and with BMW Motorrad revamping its motorcycle line, the water-cooled parallel twin motor could certainly be coming to its end-of-life with help from the Husqvarna Nuda 900 (the same can be said with single-cylidner BMW-powered Husqvarna Strada). It wouldn’t surprised me then if the choice in motors for the Husqvarna Nuda 900 was based not using the German bike company’s road-going heritage, but instead because of the financial efficiencies of the motor design at smaller-scale production. It’s all something to chew on as we wrap up Q1 2012, and head into the rest of the year.

Source: BMW Group