If you’ve ever wanted to own part of a boutique motorcycle brand, this might be your chance, as Confederate Motors is looking to raise $1 million via a private stock offering. In total, 5 million shares of Confederate stock will be made available for purchase, which means each unit of stock will be priced at $0.20 a pop.
Before you start emptying out your wallet though, the offering is made under Rule 506 of Regulation D, which means there are several restrictions on the purchase, including the fact that you will have to be an accredited investor – i.e. a financial institution or a person of wealth.
Honda’s Q2 report is out (the report is technically Honda’s Q1 fiscal report), and Big Red is showing some positive gains in 2012 thus far. With unit sales up 12% in Q2 2012 over Q2 2011, Honda is also posting a tidy revenue increase of 42% (¥2,435.9 billion, or $31 billion), while net income is also up 315% to ¥131.7 billion ($405 million). Honda doesn’t breakout its consolidated financial report into regional figures, though it doesn’t take a rocket scientist to note that these gains are likely being made primarily in Southeast Asia, and other developing markets.
Closer to home though, things are still on the up-and-up. Honda America reports 59,000 units sold in Q2 2012, up 28% from the 46,000 units it sold during the same time period last year. It should be noted of course that when reading reports from this past quarter that Q2 2011 was weighed-down heavily by the effects of the T?hoku earthquake and following tsunami.
While we’re still poring over Harley-Davidson’s annual report, making Excel spreadsheets, and winning at bullshit bingo, a couple interesting facts have struck us about the company and some of the trends it is experiencing. While it’s been mostly doom and gloom around Harley-Davidson in 2010, the Milwaukee-based company does appear to be solely in business because of the strong cost-cutting CEO Keith Wandell has been able to achieve during his tenure. Despite the moaning and groaning from the Bar & Shield loyal about Wandell’s non-motorcycle riding lifestyle, the CEO knows how to trim the fat, which is exactly what this HOG needed. Find five interesting facts for you to mull over this weekend after the jump.
Harley-Davidson has instructed its dealers not to talk about how sales have been throughout the recession, but the news that 36 dealerships have closed in the past year, and more closures are expected in 2011, speaks for itself on how sales have been. On a conference call with analysts CFO John Olin said, “This contraction was expected and in-line with our desire to modestly consolidate our U.S. dealer network in response to lower overall volume since the economic downturn took hold,” which is a very glossed over way of saying that American brand has become too bloated over the past years, and needs to go on a diet.
Harley-Davidson expects to ship between 221,000 & 228,000 motorcycles worldwide in 2011, which is up 8% over last year’s figure, but still pales in comparison to the numbers the Milwaukee brand was posting before the economic collapse (303,479 in 2008). Since 2006, sales at Harley-Davdison have continued to slide, but the most dramatic affect was in 2010, where sales were down 30% compared to before the recession (over 36% in the domestic market).
Harley-Davidson has announced its Q1 quarterly earnings today, and the Milwaukee-based company posted a $68.7 million profit. This news comes after Harley-Davidson posted a $218 million loss last quarter, and finished in the hole over $55 million for the 2009 year. Harley’s return to profitability is partially due to the company’s restructuring of its financial services, which are once again generating money for the iconic American brand. Harley-Davidson Financial Services posted a profit of $26.7 million this past quarter, almost a third of HD’s net income in Q1.
It’s been a rough outing in the stock market for Harley-Davidson recently as in the past 10 days the company has seen to substantial hits to its stock price. First the company was hit by the news that it would be recalling over 110,000 motorcycles for faulty fuel tank mounts. And now, the latest bad news comes in the form of a downgrade by financial powerhouse Goldman Sachs, which has downgraded their opinion of Harley-Davidson from “neutral” to “sell”. More after the jump.
In conjunction with Harley-Davidson’s Q3 financial results, and shutting down of Buell Motorcycles, the Milwaukee motorcycle manufacturer is announcing that it will be selling Italian sportbike manufacturer MV Agusta.
Harley-Davidson bought MV Agusta just under a year ago, and assumed a substantial amount of debt from the beleaguered company. This past quarter, Harley-Davidson recorded a one-time fixed-asset impairment charge of $14.2 million related to Buell and a goodwill impairment charge of $18.9 million related to MV Agusta.
After releasing grim third-quarter financials today, Harley-Davidson has also announced that it is discontinuing Buell Motorcycles. In a somber video (posted after the jump), Erik Buell confirms the news, and praises the Buell team for taking on the industry giants with “this little American sportbike company.” Buell will continue to sell its motorcycle stock, and Harley-Davidson will continue to honor any warranties and part needs for Buell motorcycles.
The New York Times ran a great article this week about the challenges facing Harley-Davidson, both from the current economic depression, and more generally as the quintessential Harley rider gets older in age.
In summation, Harley-Davidson dealers around the US and overseas are seeing sales drop dramatically as people scale back their expensive purchases, and as the access to credit becomes increasingly difficult.
There’s no real surprise there, and any hardcore fan will be quick to tell you that Harley will be back on top once this financial turmoil is over. However, looking farther down the road at Harley-Davidson’s long-term business position, there is additional trouble brewing as well.
Baby boomers account for the majority of Harley sales, and they are getting older. The NY times ends there with its commentary, but we think there’s more to the story on Harley-Davidson and the American bike market in general.
Motorcycle News is reporting that the , after funding problems have struck construction of the brand new Balatonring circuit. Rumors of the tracks financial problems have been circulating since the end of last year, but MCN is now claiming to have received information from “senior MotoGP officials”. MCN is also reporting that a move to the brand new Portimao circuit in Portugal was mooted, as a replacement for the Balatonring round, but that this was discounted because it would be too close to the official Portuguese Grand Prix at Estoril in early October. Given the current calls for cost-cutting in MotoGP, the more popular choice might be for the round to be canceled altogether. Skipping a whole weekend would cut down on expenditure significantly. Source: MotoGP Matters
Yamaha is reporting its first quarterly loss in over 4 years, with a fourth-quarter loss of $467 million (compare that to its profit of $41 million in the fourth-quarter of 2007). Since Yamaha gets nearly 90% of its revenue outside of Japan, the strong yen doesn’t help matters much either. The yen gained 17% against the U.S. dollar in the fourth quarter, thus eroding the value of overseas sales from their usually fat margins. It should shock few people at that is point that in 2008, Yamaha lost customers in North America and Europe as would-be buyers cut recreational toys like motorcycles out of their budgets due to the…you guessed it…credit crisis and falling home values. In response to this, Yamaha is expected to cut the salaries of its executives by as much as 20% from February to December in order to hedge cut-costs and as a sign of unification within the corporation…