So Long Buell?

So the big news in the American motorcycle industry this week was the decision by Harley Davidson to discontinue the Buell line of motorcycles.  On an emotional level I feel bad for Erik Buell who has poured most of his adult life into designing, building and selling an American made sport bike.  Very few of us have the balls to truly live our dream and Erik is one of those few.

So why did Harley Davidson make the decision to get out of the sport bike business?  There are those who will be of the opinion that it was to cut costs.  I have no doubt that this was part of the decision.  The fact is, the revenue generated from the sales of Buell motorcycles represent less the 3% of Harley’s total gross revenues.  To put this in perspective, the revenue from General Merchandise (t-shirts, jackets, etc.) is more then two times that.  The gap widens even further when you consider that with merchandise there are few issues with warrantees or product liability and very little cost of promotion.  That alone would be enough for the bean counters to cut out Buell. 

Looking at the bigger picture, those that are guiding Harley Davidson’s future have made the decision to focus exclusively on the Harley Davidson brand, which is one of the most recognized brands in retail.  Even among those who don’t ride. It appears that the newly appointed CEO at Harley Davidson will be making decisions based on growing and strengthening the Harley Davidson brand.  As a shareholder in Harley Davidson I’m encouraged at the direction the company is going to stay profitable in the short term and grow in the long term.

Now back to Buell.  The truth is that Harley Davidson gave Buell the chance to continue his dream.  This partnership increased the life of the Buell line by at least 15 years and provided Erik Buell the resources to develop some very innovative motorcycles and provided a distribution network to sell them.  In the end though, Harley riders are Harley riders and they are the one’s The Motor Company is going to be focusing on.

I sincerely hope that Erik Buell will continue to design and sell his dream but it won’t be easy.  Perhaps there are now enough Buell enthusiasts out there to warrant an American built “boutique” sport bike that will grow into a cult phenomenon.  Time alone will tell.

Lets Ride!

PS:  Dear Harley Davidson, please take the production Buell Thunderstorm engine and design a “Kick Ass” Sportster to put it in.  Buell power with Harley style should be easy to sell.

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