I don’t know about you, but when I read through the Q2 results, I couldn’t help but think: this industry is getting pulled in two different directions. On one hand, the Motorcycle Industry Council (MIC) is telling us sales are down across the board. On the other hand, a few OEMs are still finding ways to grow. That tells me this isn’t just about the economy — it’s about who’s making the right bets.
Let’s start with the MIC numbers. Scooters tanked — down 34% in the quarter. On-highway bikes fell 12%, and ATVs dropped almost 10%. Even the off-road categories, which we’ve all leaned on these past few years, were off by high single digits. Add it all up, and the industry is down ~8% for the second quarter. That’s not a blip, that’s a trend.
Now layer on tariffs. We have duties of up to 35% on imports from key markets, such as Japan and the EU. And to add to the confusion, the U.S. has just announced a surprise tariff expansion that targets motorcycles squarely. Steel and aluminum tariffs now cover more than 400 consumer products, including motorcycles.
But wait — there’s more. According to Black Book, tariffs on imports from key suppliers like Japan and South Korea are expected to rise to 25% to 40%, and they’re not on pause — they’re headed this way now. Given that those countries supply engines, electronics, and entire vehicles, that could be a trainwreck, not a shipping container.
Black Book states that the tariffs could increase the general import duty to 8-10 times last year’s levels, and economists predict that overall rates may reach 20% — the highest since the “Roaring Twenties.”
A logistics exec called this latest move by the White House a “gotcha” — “If it’s shiny, metallic, or remotely related to steel or aluminum, it’s probably on the list,” he notes.
Expect steeper pricing. A recent analysis indicates that new imports could increase by about 25%. Used bike prices are already climbing 10% to 20% as riders dodge the tariff shock.
According to the Wall Street Journal, Honda-Yamaha dealers in New York have reported a wave of anxious calls from customers who want to “get ahead of the tariffs.” One sales manager reported receiving five times more inquiries in five days than usual.
Harley-Davidson is reeling. They pulled their full-year forecast and are bracing for a $175 million tariff hit, even though most of their production is domestic. Global motorcycle sales are down 21%, and Q1 U.S. shipments plunged from 41,577 to only 24,865 units.
Harley’s shipments are down 28%, and retail sales are down 15%. Profit chopped in half. And yet Wall Street loves them because they sold off part of their financing arm to raise $1.25 billion. Great for investors — but how does that help dealers move bikes on the floor? It doesn’t. To me, that’s a warning sign: Harley’s financial tricks are buying them time, not solving their sales problem.
Yamaha’s story isn’t much prettier. Revenue is down, profits have been cut in half, and they’ve already lowered their outlook for the year. That doesn’t scream confidence.
Polaris is where I see some light. Sure, overall revenue dipped, but retail was up for ORVs, Indian grew double digits, and their marine business popped 16%. That tells me their lineup diversity is paying off. If one category slows down, another picks up the slack.
Honda, meanwhile, is quietly eating everyone’s lunch. Motorcycle revenue is up 7%, albeit driven by strong demand overseas. Their margins are fat. That’s what happens when you’ve got scale and broad appeal. While everyone else is trimming expectations, Honda’s pushing ahead.
BRP’s last quarter results were rough, with double-digit declines across core categories and an 18% retail drop in North America. They’ll need to prove they can steady the ship with their Q2 results. We spoke with BRP’s Sandy Scullion, president of powersports, and he is confident that the waters have calmed regarding clearing the channel for MY26 vehicles, and the tariffs are just a paperwork headache, as they plan to absorb the costs, mostly, for now.
So what do I make of all this? Dealers can’t just wait for the tide to turn. You need to act like Polaris — lean into diversity (not the woke kind, either) — and watch Honda for cues on how to hold pricing power. You should also prepare now for tariffs, as pretending they won’t impact consumers is wishful thinking. As for Harley’s “Wall Street first” strategy? I’m not betting the farm on it.
The bottom line is this: demand hasn’t disappeared, it’s shifting. If you’re smart about inventory, financing, and timing, you’ll catch the next wave. But if we all keep playing the old game, Q2 won’t be the low point — it’ll be the new normal.
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