Halfway through an increasingly difficult year for the major developed-world quartet of BMW, Ducati, Harley-Davidson and Piaggio, qualifying performance shortfalls had become name of the game.
BMW – BAVARIAN BLUES
Glimmers of positivity for BMW Group’s motorcycle business proved hard to find in an especially dense 69-page six-monthly results document. Its most extraordinary feature was the complete lack of any explanation for a dramatic profit slump on two wheels.
Revenue from the BMW Motorrad segment, compared to the same period in 2023, has fallen by 3.1% to £1.572bn. Related operating profit plunged, 30.8% down to a mere £182.4m. Operating margin dived to 11.6% from 16.2%. Net profit finished 31.2% lower at £128.3m.
The brand’s retail motorcycle and scooter output worldwide rose marginally by 0.2% to 113,072 units – precisely 201 more bikes plated. As you would expect, there was a bias towards Q2 when the sales season kicked in properly, equating to a 2.6% rise and 66,638 machines sold during April-June.
Typically, no broader details of specific Motorrad model performance or market destinations and penetration were forthcoming. Once again, that sort of information was reserved exclusively for the group’s much larger automotive segment.
A distinctly bland motorcycle-oriented statement simply referred to a stable demand situation: “where deliveries are predicted to increase slightly, owing to the full availability of models including the R1300 GS.”
For what it’s worth, BDN’s own resources leveraged through MCIA data identified a 0.9% increase to 5674 UK-registered BMW Motorrad products during the first half of this year. Barely a thousand of those were R1300 GS models, out-sold by swansong R1250 GS Adventure leftovers, according to our spies, probably on discounts. A replacement R1300 GS Adventure was announced just after the half-year report. Flagged as a 2025 model, its “full availability” isn’t on any imminent hymn-sheet.
Other than that, BMW peppered its text with dire qualifications. These ranged from “a volatile market environment in the first half of the year” through to “geopolitical tensions and trade wars having a sustained negative impact on market sentiment in general”. Ukraine, the Middle East and China were mentioned repeatedly too. But that pathetically feeble bottom line didn’t get a look-in.
€-£ currency translation at forex rates appplicable on 1 August
DUCATI – THE LUXURY OF DECLINE
Among the four-strong membership of Volkswagen’s Brand Group Progressive upmarket portfolio, Ducati was one of three losers in half-yearly results to 30 June. Its revenue, profitability and worldwide retail unit sales volume were all on the back foot. At least VW beancounters in Wolfsburg spared no detail in their admission of its failings.
During the six months in question, Ducati’s turnover fell by 8.6% to £510.8m. Resultant operating profit was a painful 21.2% down to £77.5m. Operating margin dropped to 15.1% from 17.6%. Global motorcycle deliveries to retail customers also sank by 8.6% to 32,098 units.
Within that, Scrambler sub-brand sales were 18.3% lower at 3528. The naked/sport cruiser segment spanning Diavel, Monster and Streetfighter models suffered a 22.1% decline to 8917. Sport sales – Supersport and Panigale superbike models – were 17.3% in arrears on 5478. Only dual/hyper products prospered, as the cash-cow Multistrada, DesertX and Hypermotard ranges rose by 11.4% to 14,175. The overall negative outcome was blamed on supply challenges and logistics issues. In particular, significantly decreased deliveries in China were an excuse. At least overall sales in high-season Q2 were firmer, 3% down to 19,711.
However, six-monthly total production remained pretty much stable, 0.1% up to 36,591 (just 40 additional motorcycles) compared to the first half of 2023. Star of the show was Multistrada-led dual/hyper, of course, climbing by 32.6% to 15,411. Scrambler dived by 27.1% to 4085, naked/sport cruiser incurred a 10% loss at 10.503 and sport retreated by 14% to 6592. No doubt Bologna is relying on a healthy Q3 to suck up excess inventory.
Across the six months to date, Europe accounted for 64% of Ducati retail, a 2% increase. The USA took 12%, 1% down. Other regions also fell by 1% to 20%. China, including Hong Kong, flatlined year-on-year at a mere 4%.
Set in the wider Brand Group Progressive context, parent Volkswagen’s slice of revenue action fell by 9.5% to £20.1bn, with operating profit plummeting by 42% to about £1.66bn. Overall operating margin slid to 6.4% from 10%. Audi cars were largely responsible for the worst, their profit contribution sinking to 59% (£993.7m) from 72%. Lamborghini was the solitary star, ascending from 13% to a plump 23% (£358.8m), while Bentley added 2% to 13% (£219.9m). Ducati’s aforementioned modest £77.5m actually represented 5%, an improvement from 3%.
€-£ currency translation at forex rates applicable on 25 July
HARLEY-DAVIDSON – MISSION CREEP
Six months into its 2024 fiscal year, Harley-Davidson posted a modest overall turnover increase, but the bottom line shrank. Total revenue in the period grew by 3.8% to £2.62bn. The HDMC contribution from motorcycles and related products was 2.5% up to £2.205bn. Harley’s HDFS consumer credit and inventory funding arm added £399.8m, a 10.5% rise. The LiveWire electric bike spin-off wasn’t much help, though, with a 24.6% revenue decline to £8.7m.
Profitability was a less enticing story. HDMC operating profit fell by 17.7% to £339.9m. HDFS operating profit did better, thanks to a 6.7% lift to £97.6m – aided by higher interest income and a reduction in bad debt provisions. LiveWire booked an operating loss of £44.7m, worsening slightly from a £44m loss in the first half of last year.
Overall operating profit finished 14.7% down at £392.5m. Net profit attributable to Harley-Davidson Inc. as a whole was 6% lower at £352.9m.
Across the two quarters so far this year, HDMC has shipped 73,911 motorcycles to US domestic dealers, and shipments worldwide reached 107,332. These featured 64,701 touring machines, including trikes, 30,101 cruisers, 9057 bikes in the “sport and lightweight” category and 3473 adventure tourers. In addition, LiveWire wholesaled 275 electric bikes.
Harley’s global six-monthly retail sales fell by 1.7% to 89,403. Within that, US domestic sales rose by 2.7% to 57,984. Canada was 6.5% down to 4339. The EMEA region, which means predominantly Europe, dropped by 5.4% to 13,279. Asia-Pacific suffered a 14.2% decline to 12,356. Latin America boasted a 1.3% gain to 1445 – precisely 18 more bikes rolling out of some Brazilian showroom.
Concentrating on Q2 figures in an associated commentary, Harley-Davidson chairman and chief executive Jochen Zeitz said: “Despite a challenging market, we are pleased with our second-quarter performance, in which we grew our US share in a declining market, with notable growth of more than 11% in the important core category of touring. We continue to be focused on executing our Hardwire strategy and leveraging our innovation and product pipeline, while delivering on our cost and productivity goals.”
$-£ currency translation at forex rates applicable on 29 July
PIAGGIO – PLENTY OF EXCUSES
Behind promises of future recovery and some idle boasts, Piaggio Group’s half-yearly corporate results were generally grim. Consolidated Group revenue fell by 15.2% to £833.9m. Operating profit registered an 11.5% decline to £87.7m, although operating margin improved slightly from 10.1% to 10.5%. Pre-tax profit was 20.8% lower at £65.5m. Net profit sank by 19.6% to £43.9m.
Net debt stood at £343.6m on 30 June 2024, down from £365.5m on 31 December 2023. However, no comparison was made available of the net debt position on 30 June 2023.
In the first half of this year, Piaggio’s global powered two-wheeler sales volume dropped by 21% to 211,200 units, generating a revenue contribution of £663.8m – 17.5% in arrears on comparable turnover in the first half of 2023. That figure included £68.2m from spares and accessories, which was 3.9% down.
Piaggio Group claimed a 21.4% share of European scooter sales and 27.2% of the North American scooter market. Group chief executive Michele Colaninno also flaunted motorcycle market bragging rights for the Moto Guzzi and Aprilia brands, which he said had shipped a record 11,888 bikes into European dealers during Q2.
Colaninno’s broadly upbeat assessment of his company’s position appeared at odds with harsh reality. “Once again, Piaggio has reported very positive margins, in line with our targets,” he opined. “Our product strategy is proving correct, and our brands continue to strengthen well around the world.”
But there were some qualifications to this hubris flow. “On the markets, there was a slowdown, mainly in Asia and America,” he admitted. “For the rest of the year, we expect non-euphoric but recovering markets in some regions of south-east Asia. The Indian continent performed well and is expected to continue reporting improvements.”
And then delving deeper, Colaninno added: “The international political crises mean we have to take a prudent approach, since logistics and the current necessary destocking of world networks could lead to increased costs. The Group’s operational management has enabled us to improve productivity and our goal is confirming excellent margins in the second half, even if sales continue to decline.”
€-£ currency translation at forex rates applicable on 30 July