PowerSports Business

August 14, 2017

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OPINION FROM THE EDITOR www.PowersportsBusiness.com Powersports Business • August 14, 2017 • 9 The NPA auctioneers will remain, growth opportuni- ties for the industry's leading remarketing company are on the horizon. Those are the two main takeaways from Copart's pur- chase in June of National Powersport Auctions (NPA). Copart, a publi- cally held company that does about $1.5 billion in annual revenue, certainly offers the deep pockets and long-term strategic thinking that lends itself to future growth. "We're not changing our name; we are and will continue to be National Powersport Auctions," NPA chief operating officer Jim Woodruff told Powersports Business. "That brand and the promise to our custom- ers is not going to change. We're here to stay. There are no plans to drastically change things. What we do and what they do are so different, and we are so good at what we do that we're just going to keep doing it. We're always thinking of new and better ways to do things anyway, and we'll continue to do that. It's just going to be more and better." NPA ended 2016 with a flurry by launching a new auction facility in Philadelphia and moving into a purpose-built building in Dallas. Copart, with 170 locations in the U.S. and another 200 across the globe, figures to be an ideal owner. Copart's biggest client base is automotive insurance companies, and they sell more than 2 million vehicles worldwide annually in a B2B operation. Beyond vehicles that need to be pro- cessed from accidents, Copart also processes vehicles involved in events such as hurricanes and floods. "Copart gets an entrée and a leader into a new line of business and some expertise in technology that they didn't have," Woodruff said. "We got a partner who thinks a lot like we do, and who has tre- mendous resources and great brand recognition in their own space. It was basically a group of investors selling to another group of investors, which we have done several times now. In this case, the new inves- tors are Copart." It's always great to learn of growth opportunities for industry companies, and that's apparently where NPA has landed. "The bottom line is we're excited," Woodruff said. "The opportunity to utilize their resources — that could be capital, legal teams, real estate teams — to expand our footprint is going to be something that we believe is going to help us get to where we want to be a lot faster." AMERICAN HONDA BUCKS FLAT TREND IN Q2 American Honda came out of the second quarter on a growth trend, bucking an overall industry trend that was on the down side of flat, at best. Chuck Boderman, vice president of American Honda's Motorcycle Division, told Powersports Busi- ness that Pioneer side-by-side sales were up, and newly released on-road motorcycles like the Rebel 300 and 500 came out of the gates blazing at retail during the quarter. "That's really encouraging. We're definitely hit- ting the target customer and doing what we wanted to do to expand the appeal for the entry cruiser," Boderman said. In fact, Honda's offering of on-road and off-road models 300cc and below have posted both Q2 and year-to-date gains. Grom, Ruckus, CRF250 Rally and others are offering a diverse mix for customers newly into riding. The Africa Twin remains No. 1 among 800cc- and-larger adventure touring bikes after another strong quarter. Most important, Boderman says customer traffic is still apparent for Honda dealers. "We're not seeing a big shift in credit-worthiness," he said. "Our installment penetration with Honda Finance is very stable; the quality of paper is very stable; and now that we have partnered with Citi Retail Services on the revolving side, we're in expansion. That's encouraging that we're not seeing any big shift in the quality of traffic. There's still that hesitation out there with what's going to happen with healthcare, tax code. There's still that consternation among some cus- tomers to make that purchase." SECOND QUARTER TROUBLESOME It's no secret that the second quarter proved to be quite a challenge at retail. You can see on Page 10 that CDK Lightspeed dealers — more than 1,600, in fact — com- bined for average new unit sales that were down 1.5 percent in June compared to June 2016. And the Motorcycle Industry Council proclaimed unit sales down 7.4 percent in June, although MIC data does not include UTV sales. PSB Dave McMahon is editor in chief of Powersports Business. Contact him at 763/383-4411 or dmcmahon@powersportsbusiness.com 1. Polaris announces 2018 Slingshot models 2. Polaris releases Ranger XP 1000 3. Indian releases limited run of Scout FTR750 4. Polaris recalls 26K 570 models 5. 2018 Pioneer models revealed 6. Carey Hart gets tattooed with ink from Indian Motorcycle 7. Indian unveils 2018 Scout Bobber 8. Bloomberg examines motorcycle sales trends 9. Kawasaki shoots commercial in Harley-Davidson's hometown 10. Polaris reports increased sales in Q2 11. Textron reports Q2 results 12. Suzuki expands 2018 motorcycle, ATV lineup 13. Report: Justice Department to drop $3M Harley-Davidson emissions fine 14. Mahindra plans to manufacture UTVs 15. Harley-Davidson reports strong margins, sales drop in Q2 The headlines above belong to the most frequently viewed articles from Powersports Business' three-times weekly e-news during the June 23-July 31 period. The number is based on the percentage of e-news viewers who clicked on the article's headline. To subscribe to e-news, go to www.bit.ly/PSBEnewsSignup. WHAT'S THE HOTTEST INDUSTRY TOPIC? Powersports Business blog ONLINE WITH POWERSPORTSBUSINESS.COM Leading industry executives and dealer consultants are among the contributors to PSB's blog. See below for recent blogs. NPA looking forward to growth; Honda finds some Q2 gems Visit powersportsbusiness.com/blogs Instagram hits 400 followers! The Powersports Business Instagram page has hit another milestone — sur- passing 400 followers! Recent posts are from assistant editor Kate Swanson's visit to a Power 50 dealer, senior editor Liz Keener's swag from Motul and editor in chief Dave McMahon's journey to the AMA Lucas Oil Spring Creek Pro Motocross National. Does your dealership use an Instagram page? Give PSB a follow today and stay up-to-date with industry knowledge. Follow @powersportsbusiness at www.instagram.com/powersportsbusiness to see who we are talking to, what we're seeing and where we're going! GLENICE WILDER Vice President, Powersports, EFG Companies If the majority of your customers are under the age of 40, it's likely they have already researched their pur- chase online before they set foot in your dealership. This customer wants to get the deal done and enjoy their afternoon on their new motorcycle. SCOTT HOCHMUTH Owner, Real Performance Marketing While Facebook and other forms of social media offer businesses the opportunity to advertise and to connect with existing and potential customers — don't forget to keep it "social" as well. RYAN BROWN Vice President, Powersports, Big Time Advertising The powersports industry has an opportunity that is too often not realized or just ignored by too many dealerships — our children. By focusing on children, we can begin to cultivate and build brand awareness with our future customers. JIM JABAAY Vice President, Sales and Marketing, LotVantage Verifying your local business Page (your dealership Page) adds a layer of legitimacy to your social media presence and can help customers feel more confident when they engage with your dealership on Facebook. The NPA auctioneers will remain, growth opportuni- ties for the industry's leading remarketing company are on the horizon. takeaways from Copart's pur- DAVE McMAHON WHAT THEY'RE SAYING... ON A LINKEDIN DISCUSSION: RIDENOW SHARES ITS THOUGHTS ON MILLENNIAL BIKERS This is good news! As for the hard numbers, there is no denying that new unit sales are way, waaay off the peak in 2006. That being said I agree with the premise of this article: the industry is changing. Manufacturers are bringing on more new models under 10K. Needed. Used motorcycle sales are most likely growing in proportion to the decrease in new over the past decade and my guess is the under 10 grand price is where all that used bike action is taking place. ON A LINKEDIN DISCUSSION: BLOOMBERG PURSUITS: THE MOTORCYCLE INDUSTRY IS DYING Millennials are less interested in owning a car or a motorcycle for a whole variety of reasons. Being from that generation, if I wasn't really into cars and bikes then I probably wouldn't own one. The world has more people than ever before, insurance prices are ridiculously high, parking is a nightmare and wages are not increasing with inflation. This generation is more environmentally conscious than previous generations as well which pushes them away from combustion vehicles and the high price of electric vehicles prices the majority of them out of the market. The perfect vehicle for them is a low-cost electric motorcycle as it meets all the criteria a millennial needs.

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