The low end of the big bike market is getting a lot more competitive. Although Harley-Davidson (NYSE:HOG) has been spinning its tires trying to move motorcycles off dealer lots, one segment that's been booming has been its Street runabout platform targeted to new riders, women, and those looking for urban transport.
Now Polaris Industries (NYSE:PII) is making sure those same riders know there is still another option in the American-made market with the introduction of its Scout Sixty, a lower-cost version of the slightly larger Indian Scout it introduced last year.
Polaris bought the storied Indian Motorcycle in 2011, and two years later resurrected the nameplate with three new models: the Indian Chief Classic, Indian Chief Vintage, and Indian Chieftain. The midsize Scout was unveiled at the Sturgis motorcycle rally in 2014, and was an immediate hit -- its styling harkened back to the classic lines of the model's glory years from the 1920s to the 1950s. But it was also understood that it was targeted toward what Harley calls its "outreach customers."
Not your dad's Harley
The typical big bike buyer, and the one that Harley has counted on through the years to grow its sales, is the 35-and-older white male rider. It was that demographic that could be counted on to purchase its touring and cruiser bikes like the Road King and remodeled Road Glide (though I was always partial to its Softails).
But with the recession, that bike buyer was crushed, and Harley saw its shipments tumble from a high of almost 350,000 bikes in 2006 to 210,000 in 2010. While it's since built shipments back up to 270,000 bikes last year, it was recently forced to admit it wouldn't be able to beat that number this year, and lowered its shipment guidance for 2015 to 265,000-270,000 bikes, which may still be too optimistic.
Not that Polaris was doing much better. Its Victory V-twin cruisers have been in a downward spiral for some time, losing both sales and market share. Indeed, the 150% jump in motorcycle sales Polaris saw in the third quarter was almost wholly the result of new Indian sales, as well as its three-wheeled Slingshots.
More than just leather-clad weekend warriors
To sell more bikes, Harley -- and Polaris -- needed to find new riders, and Harley was first off the line with the Street 500 and 750 models: sleek, low-cost, lightweight bikes purpose-built for new, young, urban riders and that serve as great introductions to the brand. Some 70% of Street bikes sold in the first year have been to first-time Harley riders.
Polaris is after that kind of muscle, too. Enter the Scout Sixty, its entry-level cruiser. At just under $9,000 it's pricier than the Street 750 by about $1,500, but you're getting more power. The 61-cubic-inch liquid cooled V-twin engine generates 78 horsepower and 65 foot-pounds of torque. In comparison, the 750 is 46 cubic inches, generating about 58 horsepower and 44.5 foot-pounds of torque. And like the apocryphal quote from Henry Ford that you could have a Model T in any color you wanted as long as it was black, the Sixty cuts out the chrome (Polaris named it the Thunder Black model) to hold down costs.
The bike maker is hoping it can "reach even further to include newer riders and a younger demographic who long to experience the legendary quality and craftsmanship of an Indian motorcycle."
Your typical big-bike motorcycle rider isn't so typical anymore, and Polaris Industries is looking to take on Harley-Davidson for bragging rights on who can best win over this customer.