PowerSports Business

July 10, 2017

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8 • July 10, 2017 • Powersports Business NEWS www.PowersportsBusiness.com After 30 percent growth in 2016, Zero Motorcycles sees continued success in 2017 BY KATE SWANSON ASSISTANT EDITOR From hiring a new CEO to signing its 100th North American dealer, it's safe to say that 2017 has already been a great year for Zero Motorcycles. Its electric motorcycles attract customers for the benefits they offer over a standard gasoline engine — the bikes require no routine powertrain m a i n t e n a n c e o r o i l changes; they recharge from any standard elec- trical outlet; and they produce little engine noise, vibration or heat. "Whether you're pas- sionate about pollution when it comes to trans- portation, passionate about electric vehicles and conservation or passionate about motor- cycles, we sit at the intersection of those com- munities. You can care about any of those, and you belong on this team," Zero CEO Sam Pas- chel told Powersports Business. "We're going to be able to tap into those passions on both a consumer and employee basis, which can build a really powerful brand." Before Zero Motorcycles, Paschel served as chief commercial officer for Skullcandy, driving product innovation, marketing and commercial activities. He became a powers- ports enthusiast at the age of 8, riding a Suzuki RM 80 dirt bike. Once Paschel demoed a Zero motorcycle, he said he was sold on the engag- ing experience, unlike anything he'd experi- enced on a standard bike. In his new role, Paschel aims to bring his perspective and experience as someone who is passionate about motorcycles, but has spent the bulk of his career outside of the motorcycle industry. "I'm bringing that perspective to a team of highly qualified people inside the motorcycle category," he said. "I've had the benefit of working in other industries. … That experience preps me to understand the right way to aim and manage a really talented team." Zero ended 2015 with 47 dealers in its North American network and has achieved 40 percent year-over-year dealer growth since. This May the company signed its 100th dealer, Motorcity Motorcycles in Bloomfield Hills, Michigan. Rather than asking its dealers to buy exces- sive inventory, Zero's approach is to have deal- ers carry two to three demo models throughout the year. "Trial is a cornerstone of our purchase and brand experience," said Paschel. "For us, we make it relatively simple and low-cost for a dealer to be a Zero dealer. They carry three bikes that are meant to be demos for the year and then at the end of the year they sell them." Based in Scotts Valley, California, Zero Motorcycles is a global brand with distributors all over the world. For U.S. dealers, Paschel said that once an order is placed, Zero can have a bike to the dealer and available for customer pick-up in seven days on average. When asking dealers to add a pioneer- ing electric motorcycle to their lineup, Pas- chel said they need to be passionate about the brand to be successful. The dealers he hears from the most are organizing Zero bike nights, engaging, committing to moving for- ward with the brand and building Zero com- munities. "It's not just innovation. It's being part of a revolution, and revolutions are built on passion," he added. Zero Motorcycles offers six bikes in its 2017 lineup: the Zero S, Zero SR, Zero DS, Zero DSR, Zero FX and Zero FXS. Paschel said there has been an even sales split among those models. "People buy motorcycles for emotional rea- sons, for cultural reasons to be part of a move- ment, but rationally one of the things that does separate us is the actual maintenance required over the lifetime of the bike is very simple — it's just brakes and tires," he said. Technology continues to play a key role in Zero's motorcycle lineup. The Z-Force motor features 116 foot-pounds of torque and can accelerate from 0-60 mph in 3.3 seconds. With the launch of the 2017 models, Zero has now cleared the 200-mile range in the city and above 150-160 miles on highway, depending on how aggressive the rider is. In addition, the bikes have the performance capabilities to reach speeds over 100 mph. Also important is the company's fast-charging solutions, which can charge a bike within an hour to two hours from empty to full. "We have ranges now that have gotten these motorcycles to a place where they are broadly a consumer- scalable business," he added. Recently, the company generated some buzz with its "Don't Wait for Washington" campaign. The program promised customers that they would get the expired 10 percent federal tax credit, even if Washington fails to reinstate it. "We have customers that are missing the season," said Paschel. "We took a leadership role on the most advanced powertrain out there. … We're not going to wait for anyone. We're going to continue to innovate, push the brand forward and push people toward electrification." If the government fails to reinstate the Electric Motorcycle Tax Credit by the end of 2017, Zero will pay up to $1,869 cash back, matching the tax credit, for new, eligible 2017 Zero motorcycles. Zero has sold more bikes each year than any other electric motorcycle company, said Paschel. "We are consistently in the mid- double digits in growth. We grew more than 30 percent last year, and right now we are on plan for the year as far as what we committed to both ourselves and our investors. We're planning for fantastic year." "The overall mission here is to spread the concept of an electric motorcycle. We believe we are part of a brand that can change transpor- tation," he said. "It is going to be the sophisti- cated, simple and elegant solution of how to get from point A to point B." PSB 11 years of innovation + 100 dealers = Zero SAM PASCHEL Zero Motorcycles introduced a special DSR model in honor of its 10th anniversary in 2016. One of Zero Motorcycle's dual sport offerings, the DSR, features 116 foot-pounds of torque, custom-tuned Showa suspension and Bosch ABS. Performance Brokerage Services announced the sale of Monterey Harley-Davidson and its alternate retail outlet on Cannery Row in Salinas, California, from Cardinale Automo- tive Group to Rich Gargano. Cardinale Automotive Group is now com- prised of 16 new car dealerships as well as a used car dealership. Principal Joe Cardinale decided to divest of his interest in the Harley- Davidson franchise and focus his attention on the automotive franchises. Gargano purchased House of Thunder Harley-Davidson in Morgan Hill, California in 2015 with Chaconas as the broker. Gargano again hired Chaconas to take a run at purchas- ing the competing Harley-Davidson dealer- ship, Monterey Harley-Davidson. Located just 35 miles from House of Thunder Harley- Davidson, Monterey Harley-Davidson was a strategic acquisition. The alternate retail out- let also allows Gargano the right to sell Har- ley-Davidson merchandise, apparel and gifts on the historic Cannery Row in Monterey. "I reached out to George to see if he could help me purchase a contiguous Harley-David- son dealership in order to grow my business. With his help and tenacity, including his relationships in the industry, he was able to help me acquire my second Harley-Davidson dealership," Gargano said. Monterey Harley-Davidson will operate under its new name West Coast Harley- Davidson and will remain at its current loca- tion at 333 North Main Street in Salinas. RACE DRIVEN ANNOUNCES PARTNERSHIP WITH REALTREE Michigan-based Race Driven, known for its brake pads and rotors, along with chains and sprockets, has signed a licensing agreement with RealTree for many of Race Driven's popular brands and products. The RealTree designs will be available on numerous prod- ucts from the Race Driven, RoadDog Apparel Co. and Cyclone Helmet brands. KAWASAKI ISSUES FIRE HAZARD RECALL Kawasaki has announced it is recalling approximately 6,600 units after it found that the fuel gauge retainer on affected models can collapse and leak fuel, posing a fire hazard. This recall affects a wide range of units, including utility vehicles, recreational off- highway vehicles and all-terrain vehicles. The affected models include: the 2017 Mule, Teryx and Teryx4, and Brute Force 750. FORMER POLARIS MANAGER OPENS DEALERSHIP BROKERAGE BUSINESS Matthew Plante has affiliated with Tran- sworld Business Advisors, the country's largest full-service business brokerage and franchise consulting firm. Plante has a successful history of working with independent dealers, having spent 11 years in regional sales with Homelite/Textron and 17 years with Polaris Industries as a dis- trict manager, product line sales manager and dealer development manager. "For years, I have worked with owners, improving their processes and branding in order to generate sales growth and capture a greater share of their market," Plante said. "In business transition planning, the first step involves placing the business in its best light to adequately capitalize on market conditions. I'm still helping owners maximize their return on investment in my role as a Transworld Busi- ness Advisor." Plante is operating from the company's office in the Boston area. SBS BRAKES NAMED THE OFFICIAL BRAKE PAD FOR LEARNING CURVES RACING Learning Curves Racing announced its HOT NEWS CONTINUED FROM PAGE 3 See Hot News, Page 10

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