That motorcycle sales are down because of the coronavirus lockdown seems like an obvious thing to state. Just for clarity though, American motorcycle sales through the first four months of the year are down 9% compared to last year.
Truthfully, that number is far less than we were predicting here at Asphalt & Rubber, and there is a good reason for that. While the COVID-19 scare has decimate on-road sales (-23%) and scooter sales (-24%), this has not been the case for off-road motorcycles sales totals, which are up 30%.
Even dual-sports seem to be buoyed by having a tire in the dirt, with sales reported to be down only 5% during the same time period.
Looking deeper into the dual-sport numbers though appears to give an insight on this odd dichotomy between street and dirt sales in the motorcycle industry.
Dual-Sports Show the Trend
In the dual-sport sector, the brands without small-displacement offerings (namely plated dirt bikes and enduros) still continued to suffer during the coronavirus lockdown.
With brands like BMW (-24%), Ducati (-51%), and Triumph (-35%) having only mid-sized and large-displacement machines in this category, we see the same sales struggle that is apparent in the on-road sector.
This makes sense, since these larger machines are more street bikes that can go off-road, rather than everyday-trail-slayers.
Turning the corner on this theory, we see that KTM is relatively flat, showing a decline of 3% for the first four months. In the USA though, KTM offers only a limited number of plated dirt bikes, so these sales reflect those mixed in with the company’s 790 and 1290 ADV bikes – the latter being updated in 2016 and the prior released only in small numbers.
Moving further down the spectrum in the dual-sport category, we can see that the larger the proportion of off dirt bikes is against ADV bikes helps offset this trend: Honda (-1%), Kawasaki (+23%), Suzuki (-10%), Yamaha (+6%).
Off-Road is Where the Money Is
Virtually every brand in the US off-road sector posted a sales gain in January thru April of 2020, taking the sector to an astounding 30% increase so far this year.
As you can imagine, this means every brand was posting 20% gains or more (Honda led the pack, with a 60% bump).
Kawasaki was also strong, boosting sales by 45%, while Suzuki was up 22% and Yamaha up 9%. KTM was actually the under-performer, with the Austrian brand showing only a 7% gain for the time period.
What is interesting though, is if you combine the dual-sport and off-road sales together, we being to see the that dirt side of the motorcycle industry accounts for 40% of the per-unit volume.
For a more macro view of the industry, this data suggests that brands that continue to be on-road focused, or lack a serious off-road quiver of motorcycles to offer buyers, are missing an obvious business opportunity.
Not only is the off-road sector (and by proxy the dual-sport sector) showing sales gains, but the value of having these products in a lineup has a second-benefit: it extends the buying-window for customers.
The off-road riding season starts sooner, and ends later, in most geographies, which means dealers will have more buyers through their doors in the spring and fall months, and OEMs will have a more even revenue generation throughout the fiscal year. This is a win-win from a business perspective.
The Coronavirus Conundrum
All of this data does little to explain why dirt bike sales were immune to the coronavirus lockdown though, especially when the on-road sectors were so greatly devastated. There are several theories that could explain this, however.
First, on-road sales can be thought of as more transportation focused than off-road sales (obvious enough, from the naming conventions). With no one traveling because of stay-at-home orders, only the recreational off-road segments were truly viable purchases.
Second, off-road buyers tend to live in more rural locations. With the coronavirus outbreak largely affecting urban populations, and being a relative non-factor in rural communities (thus far), it makes sense that these communities would be more likely to continue life as normal.
Lastly, the closure of schools, coupled with the stimulus checks from the government create a unique opportunity for parents (who are now faced with the task of entertaining children who don’t have daycare or school) to get a kid on a bike.
Talking to some dealerships, there is at least some anecdotal evidence to support this theory, with dealerships reporting a surge in off-road sales around the time that federal coronavirus checks arrived.
Diving into the data, we do see some evidence that the small-displacement dirt bike segments benefitted greatly the first four months of the year. For instance, trail-focused motorcycles 125cc and smaller saw a sales increase of 73% over last year – with Honda and Kawasaki almost doubling their sales in this category.
With a family taking home $2,400 or more from the government, the purchase of a dirt bike (especially one for a child) becomes a lot more attainable, and a good way to get outside of the house in a socially distanced way.
It will take a bit more work to truly suss out the trend and factors here, but overall it is an curious shift in the motorcycle industry, and it will be interesting to see if 1) it continues for the rest of the year, and 2) if the on-road sector bounces back as lockdown restrictions ease.
On a related note, a little over a year ago I wrote about how Ducati should acquire the TM Racing motorcycle brand for a turnkey off-road offering. That opinion seems only more applicable now.
Photo: KTM
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