Harley-Davidson Seeks Bank Bailout Funds

[SockMonkey]

You might want to climb down from that soapbox before you get a nosebleed...
And again, this thread wasn't intended as a forum to bash H-D or, certainly, the US Government. As far as H-D's finance arm goes, you also have to consider that GE Money Bank and HSBC Powersports - lenders for Yamaha, Suzuki and Kawasaki, are in as bad if not worse shape than H-D right now. Everybody made mistakes, and everybody is in trouble.

Your thread opens all kinds of doors so your "intent" is pretty much worthless.
No, not everyone has made mistakes, and those that haven't got greedy or succumbed to gov't pressure to do subprime loans are holding their own fairly well. You need look no further than your own neighborhood: Umpqua Bank, -they are one of countless examples of companies that did not make big mistakes and they are one of many who are not in trouble. Perhaps a bit of research on your part would cease your broad and untrue accusations.

My apologies for being so "broad". I wasn't aware I was referring to financial institutions such as Umpqua Bank (of which I'm a business customer) that don't loan money for motorcycles. So, to clear up any misunderstandings, let me restate my original assertion: Everybody that loaned money for motorcycles made mistakes. Everybody that loaned money for motorcycles is in trouble.

So, the ball's back in your court: find evidence of a powersports financing company that isn't in serious trouble and you can then tell me to "cease [my] broad and untrue accusations. Fair enough..?

 

[SouthernCruizer]

If HD gets this bail out, it will be at least the 2nd time the gov't bails them out. Some of you older bikers may remember the 1984 tariff on import bikes over 700CC's. This was in effect, a HD bailout. At that time, it was the only way that HD was able to avoid bankruptcy. People like me had to pay more for their metrics to supplement HD. I didnt appreciate it then, and I sure wouldnt appreciate it now.

My mantra? JUST SAY NO TO BAILOUTS!! period.

 

[windchaser1942]

Well..., they are a "National Icon" (we don't want to be losing any of them...)

In all due respect....where do you end the "handouts".

I bought my FJR because it is a perfect fit for me and my style of riding. I didn't buy a Harley or even consider it as I believe it is grossely over rated, and over priced. I used my money to buy the FJR. Why do I have to use "my tax" dollars to bailout Harley. Why don't they do what the rest of us have to do when we are in over our heads....have a garage sale and get rid of the things that I don't need or should have never bought in the first place. My tax dollars are suppose to provide services to the people, defense, etc. I believe the US Gov't has failed the American People miserably , just look at the debacle of Katrina, the current bank bailout that has led to CEO bonues that are off the chart and even major banks to buy 50 million dollar private jets.

Now, you believe we should bailout a motorcycle manufacturer that uses a "in your face, screw-it marketing" that has failed them and now I need to bail them out just becuase they are a so called icon. The only icon that I am interested in seeing bailed out is the active duty soldier, and his family or the veteran who have busted they bodies to give us freedom. But continue to be underpaid, often taken for granted and not always appreciated for the sacrifice they have given this country and it's people. And, the rest of the God fearing people who work hard, provide for their families, respect their fellowman and show him every curteosey and still tear up when they hear the Star Spangled Banner and believe in saying the Pledge of Allegiance. These are the people who deserve the greatest care.

You might want to climb down from that soapbox before you get a nosebleed...

And again, this thread wasn't intended as a forum to bash H-D or, certainly, the US Government. As far as H-D's finance arm goes, you also have to consider that GE Money Bank and HSBC Powersports - lenders for Yamaha, Suzuki and Kawasaki, are in as bad if not worse shape than H-D right now. Everybody made mistakes, and everybody is in trouble.

well sir...I didn't mean to upset some folks with my comments, it's just that subject, is hard not to discuss it without a little passion. I'm not trying to bash anything...it's just an "honest opinion". I'm not on a soap box or anything else.

Consider this, there is a new Harley Store between Logan WV and Williamson. It is nestled up a small hillside. It is not close to anything as there are "no other" business around it or even near it. I stopped in there one day to look at it and was blown away with the contents. There was probably over a million dollars worth of clothing, jewelry, grandfather clocks, various chrome accessories and the like(over 90% of the marketing space). I did manage to see maybe six bikes. Most of them were used. I wondered around that store for a good hour and only one other person came in during that time. Now I ask you what kind of a business plan would spend that much money to build this store? No wonder they are hurting and bleeding...no body is buying because they have moved so far left of center to sell their primary product....motorcycles. And now the politcally correct things is to say..."ok, they are a national icon, we should bail them out"! I haven't bashed the brand, I am only questioning their business plan. I am surrounded with a great many friends who own and love their HD bikes. More power to them...it fits them and if it makes them happy ...go for it. Finally, as for the other manufactures like Honda, and Yamaha. Seeing the bleek financial picture they face they have ceased production to save cash. And, when it comes to Money Banks like GE I have a hard time feeling sorry for them after all the CC companies have raked us all accros the coals with their "loan shark" interest rates. I'm sure I have probably violated more of the forum rules with my reply to you. If so I am sorry, but your response really needed a reply. Ride safe!

 

[charismaticmegafauna]

If HD gets this bail out, it will be at least the 2nd time the gov't bails them out. Some of you older bikers may remember the 1984 tariff on import bikes over 700CC's. This was in effect, a HD bailout. At that time, it was the only way that HD was able to avoid bankruptcy. People like me had to pay more for their metrics to supplement HD. I didnt appreciate it then, and I sure wouldnt appreciate it now.

Wasn't the rationale (back then) that the Japanese were "dumping" bikes on the American market and causing H-D "unfair" competition? H-D said they (Jap M/Cs) were selling comparable motorcycles 'too cheap'.

The tariff was implemented (by Reagan) to help Harley compete.....(yea, sure...).

Might've been believable if the money had gone to Harley....?

 

[SouthernCruizer]

If HD gets this bail out, it will be at least the 2nd time the gov't bails them out. Some of you older bikers may remember the 1984 tariff on import bikes over 700CC's. This was in effect, a HD bailout. At that time, it was the only way that HD was able to avoid bankruptcy. People like me had to pay more for their metrics to supplement HD. I didnt appreciate it then, and I sure wouldnt appreciate it now.

Wasn't the rationale (back then) that the Japanese were "dumping" bikes on the American market and causing H-D "unfair" competition? H-D said they (Jap M/Cs) were selling comparable motorcycles 'too cheap'.

The tariff was implemented (by Reagan) to help Harley compete.....(yea, sure...).

Might've been believable if the money had gone to Harley....?

***************************************

The money didnt actually go to HD. The tariff was designed to make the metrics higher priced so that the spread between HD and metric was not as wide, and thus, maybe more Americans would opt for the higher priced HD. I remember a lot of my biker friends were either fanatically for or against the tariff, depending on what they liked riding.

It would be interesting to find out exactly where the tariff monies eventually ended up.

 

[LDRydr]

While the tariff DID help H-D (and they were the ones asking for it) you may want to check up on the exact reason they asked for it. From 1978 through 1980, Japanese imports pretty much matched their sales registrations. Then, in 1981, they imported about 30% more than they sold and in early 1982 they were bringing in TWICE their rate of registrations. Harley calculated the Japanese companies had a year and a half's supply of new bikes stashed in dealerships and importers' warehouses. Honda and Yamaha were going head-to-head, each trying to knock each other out, and Harley was about to get hit just by standing on the sideline. Also worth noting is both Kawasaki and Honda were manufacturing bikes in America, and would (in a way) benefit from the tariff (to a point). BTW, once the tariff began the Japanese quickly downsized their 700cc bikes to 699cc to evade the change for that sized bike.

Another interesting fact is that this was the second time H-D had asked for tariff protection. The first was in 1951 - against the British.

The complete history of the motor company, including the tariff, are well detailed in a book called Well Made in America. It's a good read, and good for any business person (IMHO).

 

[RenoJohn]

My apologies for being so "broad". I wasn't aware I was referring to financial institutions such as Umpqua Bank (of which I'm a business customer) that don't loan money for motorcycles. So, to clear up any misunderstandings, let me restate my original assertion: Everybody that loaned money for motorcycles made mistakes. Everybody that loaned money for motorcycles is in trouble.
So, the ball's back in your court: find evidence of a powersports financing company that isn't in serious trouble and you can then tell me to "cease [my] broad and untrue accusations. Fair enough..?

You said "everyone" ...and many are making the same mistake of lumping all institutions together when in fact there are some responsible institutions with solid methodologies who are unfairly being lumped into the mix. Yes, some of them make motorcycle loans, including many of the credit unions. That was my point.
I chose Umpqua, because it is near you, and at least from a distance here in Nevada they seem to be a pretty well run organization, certainly compared to the banks who leveraged themselves on supprime lending. I admire Umpqua and their many counterparts who are smart and feel compelled to defend these smart business when they're broadly thrown into the mix of "everyone". IMO they have earned the right to set outside the tarnish of many of these subprime lenders and poorly run financial institutions.

I'm not aware of Umpqua's loan mix, but if you say they have no motorcycle loans, I'll take your word for it ..however i did think I saw MC as part of the mix of the paper they took over from the failed (Clark) Washington Bank. Still, I'll agree that is splitting hairs.

I'm not intimately familiar with the other lenders you mention, but I think it safe to say that they have a broad mix of loans. My point being that lumping these certain "everyones" in with Harley Davidson is kind of a stretch because:

Harley's paper is almost exclusively tied up with Harley Davidson Motorcycles (uhh, ...and of course swag and Harley grandfather clocks), the other lenders are all over the place with their loans.

Furthermore, as noted in one of the great posts above, Harley really isn't in that bad of shape, and they own most of their own paper/debt, which not only shows some faith in their plan, but it also shows some basic responsibility. Although, in hindsight i'm sure they'd do things a bit different and much of this was likely motivated by greed as much as anything.

======================

Some really great, interesting, fascinating and well written posts on this thread!!

 

[LDRydr]

======================Some really great, interesting, fascinating and well written posts on this thread!!

Got that right! Some serious discussion going on here, and we can have too much of that! Where the hell is ODOT when we need him??

PS. I did mention that my wife worked for that failed bank, Bank of Clark County? She's now contracting to the FDIC, not sure how long she'll be needed. This whole mess is getting serious, in more ways than one.

 

[RenoJohn]

======================Some really great, interesting, fascinating and well written posts on this thread!!

Got that right! Some serious discussion going on here, and we can have too much of that! Where the hell is ODOT when we need him??

PS. I did mention that my wife worked for that failed bank, Bank of Clark County? She's now contracting to the FDIC, not sure how long she'll be needed. This whole mess is getting serious, in more ways than one.

Dennis, I never put it together! I half-*** follow Umpqua because they've been medium aggressive in areas around me as they grow ...and I've read interesting things about them -including how they gained ownership of much of Clark's paper.

You mentioned Mrs LDRyder was going through some changes ...but like I said, I never put it together.

I've sure enjoyed many of the heads-up posts on this thread. Some smart thinkers in this mix.

Best wishes to the Mrs, I hope all works out for the best. As far as the 'serious' you mention. I look forward to those details when appropriate time.

 

[odot]

There's smart pups here? Say it ain't so.........

 

[charismaticmegafauna]

"it ain't so........."

Now, if Harley gets Federal bail-out funds? Shouldn't Indian (another American Icon) get a hand-out, too?

And, how about the Hanlon brothers. They had to shut-down their Belle Plain manufacturing operation because the Inver Grove Heights bank ran out of money. A good-sized bail-out could bring another American Icon (Excelsior-Henderson) back to life?

And what about the Victory Vision (Anniversary Edition) -- an "Icon To-Be"....

 

[Bustanut joker]

And what about the Victory Vision (Anniversary Edition) -- an "Icon To-Be"....

10 years and getting stronger.. Victory had/has a vision (beyond said bike) and a solid business plan to match.

No damn game playing an lotteries to buy bikes, just a solid machine with realistic pricing.

Granted the first year or two the "growing" pains scared some folks off, Lookit 'em now..

Oh. I may be a wee bit biased as a friend of mine now works for Victory... Yeah he left the Motor Company after the embarrassing failure of the VRod line.

Look out Milwaukee, there's a new playa in Town.

:jester:

 

[SouthernCruizer]

We all need to get together and write our congressmen/women and get some bail out funds for fjrforum.com . A few million would make our group buys look amateurish by comparison!! The powers that be on this board could buy all kinds of good farkles and hand em out to the general membership!!

Remember who thought of this 1st! I want me some new pipes!! C'mon TARP!

 

[SockMonkey]

"it ain't so........."Now, if Harley gets Federal bail-out funds? Shouldn't Indian (another American Icon) get a hand-out, too?

And, how about the Hanlon brothers. They had to shut-down their Belle Plain manufacturing operation because the Inver Grove Heights bank ran out of money. A good-sized bail-out could bring another American Icon (Excelsior-Henderson) back to life?

And what about the Victory Vision (Anniversary Edition) -- an "Icon To-Be"....

Speaking of Indian, what a completely **** time to (re)re-launch a premium powersports product. I'm sure there are folks out there with the cash for a $35k+ bike, but I'd bet that Indian's executive team is more than just a bit concerned at the moment...

 

[jmdaniel]

BTW, once the tariff began the Japanese quickly downsized their 700cc bikes to 699cc to evade the change for that sized bike.

Actually, it was the 750cc bikes downgraded. My college graduation present to myself, in the spring of '89 was a brand new '86 Honda 700 Shadow, that had never been uncrated.

 

[Wicked Webby]

Hmmm...

Whether you like HD's or not... Let's consider their situation.. Yes, the economy is down and times are tough for a lot of folks. How many working folks can really afford a $20,000+ bike these days (or ever could or shoulda got finance too!). Here is the deal, Harley Davidson is guilty of literally pricing themselves out of the market by clear motivations of greed. They have been selling average motorcycles at an overly inflated higher than average price point for much too long. The bubble had to burst.. They should of been saving up on their profits. Should the US tax payers now have to contribute to a poorly managed motorcycle leisure company and bail them out just because they claim (they do plenty of importing) to only be made in the USA with US parts?

You decide,

WW

 

[jmdaniel]

10 years and getting stronger.. Victory had/has a vision (beyond said bike) and a solid business plan to match.
No damn game playing an lotteries to buy bikes, just a solid machine with realistic pricing.

Granted the first year or two the "growing" pains scared some folks off, Lookit 'em now..

Oh. I may be a wee bit biased as a friend of mine now works for Victory... Yeah he left the Motor Company after the embarrassing failure of the VRod line.

Look out Milwaukee, there's a new playa in Town.

:jester:

With all due respect, (okay, maybe some of it is undue...), I also have a good friend at Poalris, and we have discussed at length what a disappointment the Vision is. It's an oddball bike, with limited interest, and after I rode one for 1300 miles last summer, I can tell you the quality doesn't hold a candle to the Japanese bikes I have ridden and owned. I would venture to guess that if they hadn't dumped so much cash into the R&D, that bike would be on the scrap heap, like Honda's Rune. Victories have been getting better over the last 10 years, (I've ridden them all of those 10 years), but I wouldn't buy one, as I don't think the value is there. Bottom line is that the number crunchers at Polaris saw profit in taking 3 - 5% of the Harley buyers market, at comparable (over)pricing, and built a bike line to do it.

YMMV

 

[trvler48]

I saw the numbers for victory too. Down 40% for the quarter and 17% overall. And they are in a better position than most. Yamaha's number is a mirror image, although much more market share. Is there any motorcycle company that is not doing bad?

 

[Bustanut joker]

10 years and getting stronger.. Victory had/has a vision (beyond said bike) and a solid business plan to match.
No damn game playing an lotteries to buy bikes, just a solid machine with realistic pricing.

Granted the first year or two the "growing" pains scared some folks off, Lookit 'em now..

Oh. I may be a wee bit biased as a friend of mine now works for Victory... Yeah he left the Motor Company after the embarrassing failure of the VRod line.

Look out Milwaukee, there's a new playa in Town.

:jester:

With all due respect, (okay, maybe some of it is undue...), I also have a good friend at Poalris, and we have discussed at length what a disappointment the Vision is. It's an oddball bike, with limited interest, and after I rode one for 1300 miles last summer, I can tell you the quality doesn't hold a candle to the Japanese bikes I have ridden and owned. I would venture to guess that if they hadn't dumped so much cash into the R&D, that bike would be on the scrap heap, like Honda's Rune. Victories have been getting better over the last 10 years, (I've ridden them all of those 10 years), but I wouldn't buy one, as I don't think the value is there. Bottom line is that the number crunchers at Polaris saw profit in taking 3 - 5% of the Harley buyers market, at comparable (over)pricing, and built a bike line to do it.

YMMV

Yeah my buddy said the same thing about the Vision. Though they didn't expect much in sales, it's still a disappointment. The plus side for Victory is Polaris products were able to support the Victory line from it's inception. They didn't need a lot of "outside" support from Banks, Private Investors, etc.. I agree the quality isn't as good as Japan yet but, as you stated it has improved considerably.When you consider the goal was the Harley owner, that's a damn tough group to persuade to try another product line.

As far as buying one? nah.. I still feel the "need for speed" and don't wanna "Flintstone" my way to it Still like the 8 Ball though.

The Rune was a decent bike Over priced and uninspired performance probably killed it. Buddy of mine came into a bit of cash and bought a Wing and a Rune. After riding both I'd buy a wing over the Rune, the Rune does cast a really cool shadow an looks sweet in the storefront window when ya see your reflection in it. Old wing makes ya look so ordinary. Image is everything remember? The Rune steers like a big ol Buick LeSabre and turns in the same distance.

But oh so cool, lowrider style

Oh, Don't worry 'bout the respect thing.... I'll send ya a check

:jester:

 

[JRO]

I think the Yankee Gubment better bail 'em out , up thar at Harley, an' they'd best git at it, soon. Here is my good reesons why:

1. Without Harleys on the road, I'll have to pass faster motorcycles. This kin lead to racin', which ere illeggal, an' which gits peeple kilt on the hiways. Harleys is easy bikes to catch; whereas Hyabussas ain't.

2. Without werk, them damn Yankees start movin' South. I is tired of Yankees from California an' Michigan movin' here, on account of we gots a better eckonomy - bein' alreddy depressed, another crisis doan bother us much. We cain't take a bunch more undocumented Yankees movin' here, so the gubment needs to keep 'em busy, up North.

3. I haff a friend who sales more Harleys (to Yankee immigrints) than the Harley dealer up the street from his bike shop. Harley sales keep him in buisness, handling traditional Southern brands, such as Aprilla an' Motor Guzzi. Without new Harleys, he would have no used Harleys to sell.