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Common Tread

Turmoil and surprises so far for the motorcycle industry in 2020

Jun 18, 2020

Your local dealership might have closed for good in the last few months. Or it might have had an unexpectedly strong spring season, considering the devastating impact of the novel coronavirus. No wonder these are called “uncertain times.” 

In a few weeks, we will have stats on the industry's performance in the second quarter, but if we learned anything from the first quarter of 2020, it's that predictions are hard to make. Performance was all over the map for individual powersports dealerships across the United States in Q1.

Compared to last year, overall U.S. motorcycle sales for the quarter were only down four percent, according to the Motorcycle Industry Council (MIC), as dealers experienced a steep drop, a rapid rebound and uneven demand for various kinds of bikes. The turbulence was the result of positive effects, such as passionate customers, adaptable retailers, and the isolation-friendly nature of riding, balanced against the negative effects of massive unemployment, stay-at-home orders, and serious health and safety concerns.

Sales were uneven, however. On-highway (down 12.3 percent) and scooter (down 15.6 percent) sales fell, according to the MIC, but that was offset by a big jump in off-highway (up 18.9 percent) bikes and flat sales of dual-sport (down 0.2 percent) models as riders took to the dirt. 

New motorcycle sales are only part of the story, though. Motorcycle Powersports News (MPN) reported on a study by Hedges & Company that compared online sales of aftermarket powersports parts and accessories in the first week of March (before the main effects of the pandemic) and in the first week of May in the United States and Canada. It found sales were up 126 percent. That far surpassed the usual season opener uptick. MPN called the surge “unprecedented” and attributed the online sales spike to “the coronavirus shutdown and stay-at-home orders across North America.” Overall, aftermarket ecommerce sales across the automotive, light truck and powersports sectors were up 42 percent and OEM replacement parts were up 14 percent.

Another phenomenon is the national shortage of bicycles and ebikes. The virus quickly reduced usage of public transportation in large metro areas and those who were still commuting sought inexpensive, practical alternatives. Add to that the production disruptions in major bicycle manufacturing companies in China, and it’s a recipe for empty stores. Many shops are finally restocking bikes, which sell immediately to months-long waitlists.

Motorcycle dealerships adapted to the pandemic and found new ways to serve customers. Most manufacturers, including Honda, Kawasaki, Yamaha, and Polaris, worked with dealerships to offer some contactless purchasing options to purchase motorcycles over the phone or online, with a bike delivery soon after. No handshakes, signatures, or in-person contact required. Some dealerships benefited from the PPP Loan Bill and powersports employees were deemed essential workers, in most places. Some service departments reported they were busier than usual as business was boosted by the arrival of federal stimulus checks and riders saw some alternative activities they previously enjoyed were shut down.

The used motorcycle market has been iffy. Sellers are eager to turn unwanted motorcycles into cash, especially when they’re holding models in high demand, but their pool of potential buyers has been curtailed by fears of virus transmission, loss of employment, and other obstacles. (One Craigslist post I saw politely asked that the cash be handed over in a Lysoled Ziplock bag. A fair request, and another example of the increased inconvenience of selling anything these days.)

That’s not to say that motorcycling escaped the disruption and risk of the coronavirus. Dealership closures, canceled events, crowdless races, and stay-at-home orders are just a sampling of negative changes for the industry.

Another development that could have a long-term effect is the disruption of rider training programs. MSF classes in multiple states have been canceled. Some programs, like Pennsylvania’s, may close for good. This could have a long-tail negative effect on ridership by increasing barriers to entry for new riders.

“The MSF continues to work closely with all stakeholders in rider education and motorcyclist safety to seek solutions for today’s challenges,” said Robert Gladden, vice president of training operations, in a press release. “Many state programs are experiencing significant turbulence, ranging from postponed classes, to loss of ranges on college campuses, to complete program shutdowns. However, the MSF’s many resources, from ourRiderCourse Enrollment System, to our varied RiderCourses, to our online Quality Assurance System, to our online Q-Center, to the Basic eCourse, remain available to qualified entities. We hope that all our partners in safety reach out to us for our help.”

In two weeks, we'll start Q3 of 2020 and soon afterwards we'll get some insight on how the industry fared in Q2 and get a clearer picture of the motorcycle industry's health.