A&R Pro

About The Rising Cost of Ducati Superbikes

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I was a bit surprised when Ducati announced pricing on the new Panigale V4 model.

I knew the Italian brand would command a premium for the latest edition of its flagship model, but what took me aback was how high the price had climbed ($21,195) in one swoop, even though prices on the Ducati 1299 Panigale have steadily been creeping upward over the past few years.

Part of the blame is surely comes down to simple currency conversion between the euro and dollar, which has also been climbing steadily in the past year (after a sudden and sustained drop for the past three) and is now nearly at its year-long high.

When it comes to the US market though, currency fluctuations are only part of the puzzle when it comes to understanding the pricing programs put together by motorcycle manufacturers.

Motorcycle manufacturers subsidize (and inflate) their prices for the US market, based on the goals of the company, and Ducati is no different.

For European manufacturers too, it is important to understand a fundamental difference in economics: that pricing in Europe reflects a value-added tax (VAT), which is typically close to 20% for motorcycles – an inflation of consumer cost that doesn’t occur in the United States.

That being said, in the same breath I should mention that sometimes tariffs come into play for the US market…but that’s a whole different story. For now, let’s stick to how Ducati superbike prices have climbed over $6,000 in just over 10 years’ time.

Show Me the Money

As you can see from the chart below, the price on Ducati’s superbike models (base model in blue, “S” model in red) has been climbing steadily since 2007. In that 11-year time period, the price of a base model Ducati superbike has climbed by $6,100 MSRP. Umpf!

From 1998 to 2006, there is a similar price-creep for the superbike models, with the obvious price drop between the 2006 and 2007 model year lineup – and there is good reason for that.

In 2007, the Ducati 1098 Superbike debuted in the United States, a bike I lovingly refer to as “the greatest hits album” of Ducati superbikes.

This is because the Ducati 999 Superbike was a highly contentious motorcycle for loyal Ducatisti, and remains so to this day, though I think it gets a bum wrap for “nearly bankrupting” the Italian brand.

Still, the design of the 1098 was very much a reaction to the 999, and its aim was to assure the Ducati-loyal with a bike that drew from all of the great Ducati design elements of the previous decade.

For the US market though, then Ducati North America CEO Michael Lock wanted to make sure that Ducati’s flagship model continued to catch the wind for the Italian brand’s sails….err…sales…you get what I’m saying.

As such, Lock secured cut-throat pricing for the Ducati 1098 Superbike in the USA, but only if Ducati North America dealerships would agree to placing unusually large orders for the machine.

The result? The Ducati 1098 Superbike was the most affordable Ducati superbike ever produced…and that’s before you account for inflation.

And…that brings me to my next point, because one really can’t compare the price of something 10 or 20 years ago to that same something today, at least not without first examining the effects of inflation.

Red Sea Rising?

The chart below shows the price of Ducati’s superbike models since 1998, but adjusted for inflation by using the consumer price index (CPI).

As you can see, the chart above paints a very different picture to what has been going with Ducati’s pricing structure, and while there are arguments to make about price adjustments using CPI, this graph reflects a better perspective on the relative “cost” of Ducati’s superbikes compared to what money cost at the time.

The argument to be made here is that while the Ducati Panigale V4 might be the most expensive superbike ever from Bologna, in terms of sticker price, but the bike is still relatively affordable in terms of what consumers have to spend in terms of buying power.

Now, if Ducati was pacing its superbike prices on consumer buying power, we would see two flat lines in the chart above, but instead we see a slight rise. This means the “cost” of a superbike (understanding that the word “cost” is a loaded term in this sense) has been rising, albeit slowly.

This notion again can be complicated, since motorcycle enthusiasts in the United States primarily finance their purchases, instead of paying with cash, so the relative lending rate can play an important role in how “affordable” a motorcycle can be when comparing different market periods.

That being said, lending rates have largely dropped over the past 20 years, with the current banking climate having historically some of the lowest rates post-WWII.

The nutshell argument here is that while Ducati has increased the cost of ownership for its flagship model, its availability of a bike like the Panigale V4 to consumers is still relatively strong, compared to bikes like the 916.

An interesting analysis might be to factor a net-present value, or total cost of ownership in terms of principal and interest, on each superbike model year based on the popular mode of purchase (cash vs. credit).

I know Ducati has had some near-1% financing offers in the past, but this information is more difficult to track down, and a little outside of the scope of what I wanted to talk about in this article.

My gut thought here is that the 1199 Panigale might have been the Ducati deal of the decade (boom, alliteration game on point), though Ducati riders will of course prefer the more stout 1299 model. After all, there is no replacement like displacement.

Yeah, yeah, yeah…but what about comparing Ducati’s pricing trends against its Japanese competitors?

The Other Side of the Coin

To examine this idea, I pulled the same pricing data for Honda and Yamaha (saving myself the extra work for Kawasaki and Suzuki, though a spot-test suggested similar results), illustrated in the graph below:

The trend of note here is that the Japanese brands went to great lengths to keep pricing in the USA static fo six to seven years, from the late-1990s to the early 2000s. After that, prices started to slowly increase. I have a theory about this.

Instead of creeping prices though, for the most part the Japanese saved their price bumps for when new models were released. With manufacturers adhering loosely to a two-year product cycle, this made for ample occasions to adjust pricing, with a few notable exceptions.

For Honda, we see a noticeable price increase in 2009 of just over $1,500 MSRP, for reasons I can’t fully explain (leave your thoughts in the comments section).

The other two points of interest though come in 2015 for Yamaha, and 2017 for Honda, which correlate to both brands implementing IMU-powered traction control packages. This trend holds true with the other Japanese brands as well.

Like with Ducati’s pricing, looking at things when inflation is accounted for, creates an interesting perspective that tells more of the story.

Here we see that the relative “cost” of Japanese bikes have increased in the recent times, especially as the Japanese brands update their superbike offerings with modern electronic packages.

On the whole though, the Japanese have been better at keeping the affordability of the superbikes pretty even over the past 20 years, with roughly a $1,000 variance, which is a quarter of Ducati’s historic cost variance.

This creates the interesting trend that there has been a slow merger between Ducati (representing the European as a whole) and Honda/Yamaha (representing the Japanese brands on the whole) to a common price-point. Again, if you factor in financing payments, there is little between the brands.

The Great Convergence

There are two big factors that create this convergence in affordability: 1) the features of modern superbikes across the brands are becoming a commodity, and 2) the market for superbikes is contracting (a notion I agree with, though not to the extent that manufacturers would have us believe).

Superbikes have gone through an interesting evolution. As motors became more powerful, chassis design became more important (this created opportunities for brands like Bimota, which could out-build the OEMs when it came to chassis design).

Motorcycle manufacturers, especially the Japanese brands, eventually became experts in frame structures however, which then lead to the next-generation of superbikes that grew in outright power, and once carburetors were replaced by fuel-injection systems, technology crept in.

Fuel-injection made ride-by-wire possible, which in turn made traction control possible, which begat the advance of inertial measurement units (IMUs). Now, motorcycle manufacturers rely on a host of electronic aids, that serve both the rear and front wheels of the motorcycle.

Of note though, these advancements have led to a handful of OEM suppliers developing and controlling the technologies I just listed, effectively commoditizing them in the process. For example, one has to look very hard to find an ABS system that is not being provided by Bosch or Continental.

Add into the mix the rise of stricter emission standards, and we have created an atmosphere where surpassing the 200hp figure on pump gas (which is really only 90% gasoline by volume in the United States), while still conforming to EPA and Euro4/5 standards, is nigh on impossible.

This constricts the points of innovation that we can expect from our superbike models, again further commoditizing the segment. Differences in implementation still remain, which is why a BMW S1000RR still feels very different from a Kawasaki Ninja ZX-10R, though both bikes have a one-liter inline-four engine.

We also see subtle brand innovations, like Ducati’s “frameless” chassis philosophy, which is now in its second generation; as is Yamaha’s crossplane crankshaft design.

Subtleties like engine configuration, chassis structure (trellis vs. twin-spar vs. frameless), and OEM part-supplier choice still exist of course, which leads to some variety in the field of competitors, but on an infinite timeline, we are approaching a common design.

If you need evidence of this, look at the recent development in the MotoGP Championship, especially during the misguided 800cc era.

In the GP paddock, all of the racing competitors converged on a single design philosophy, as they looked to maximize the most performance possible from the very particular Bridgestone spec-tires they were forced to use.

As suspension components, braking components, electronic components, and tires plateau on their performance characteristics, it will be harder to distinguish between the various superbike models and brands.

Looking Ahead

All of this will remain true until the next revolutionary change. A new form of tires, non-pneumatics perhaps? Or a new drivetrain, electric motorcycles anyone? New suspension technologies? Weird front-ends? Sharks with freakin’ laser beams?

Changes in laws and regulations will factor too…and loyal A&R Pro readers should be fully aware of how much flux there is in the transportation industry right now.

Until then, I predict we’ll see a continued convergence in affordability and functionality, for both Japanese and European brands.

Yes, there will be price differences, but they won’t be a reflection of the products per se, and will reflect more the intangibles that surround a company, like branding, styling, and perception.

Photos: Ducati

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