Leaving aside the mainly self-inflicted destruction that has been ripping apart KTM for months, the three other major motorcycle manufacturers domiciled in mainland Europe – BMW Motorrad, Ducati and Piaggio – have also been suffering a litany of disruptive influences sucking stability out of their businesses. And few have begun to assess the huge impact on their exports from rampaging US president Donald Trump’s tariff warfare. BDN financial editor Roger Willis reports
BOXER REBELLION
BMW Group’s monumentally tedious 432-page tome detailing full-year results performance during 2024 landed on our desktop like a thunderclap. But as far as specific BMW Motorrad content is concerned, it proved to be a damp squib. Much was made of strongest annual retail deliveries to customers in the company’s history, amounting to a record 210,385 motorcycles and scooters sold. But this actually meant only a miniscule 0.6% increase. And yearly production had declined by 2.8% to 215,727 units.
Motorrad annual revenue rose by 0.2% to £2.713bn. Operating profit dropped by 23.6% to £166.8m. Operating margin fell from 8.1% to 6.1%. Pre-tax profit was 23.3% lower, after favourable pricing and product-mix effects were offset by higher material and development costs.
Return on capital employed came in at 15.5%, down from 22.1% in the previous year. According to BMW bean counters, this change reflected mainly the downturn in profit before tax on one hand and an increase in net working capital, due to a rise in average inventory levels, on the other. Net profit garnered from the Motorrad segment suffered a 24.6% decline to £116.3m.
Providing further retail sales figures, the results presentation said a total of 118,704 motorcycles were delivered to European customers in 2024, 2.3% up year-on-year. Within that tally, German sales volume grew by 8.3% to 26,177, while the French market fell by 4.5% to 20,693. Italy put on 2.7% to 16,617 and Spain added 2.3% to 13,009. The UK didn’t warrant a mention.
On the other side of the Atlantic, bike sales improved by 3.3% to 47,692 units. Most notably, Brazil posted solid growth of 8.2% to 15,267. But the USA managed only a 1.5% rise to 17,272. Subdued economic activity in Asia also saw the Chinese market slump by 12.4% to 13,872.
Banging his drum prior to the results, head of BMW Motorrad Markus Flasch ignored any inconvenient facts (such as embarrassingly thin profitability) that might emerge: “I would like to extend my heartfelt thanks to our customers and community around the world for the tremendous trust they have placed in us once again in 2024. BMW Motorrad claims first place in the global premium motorcycle segment. Our market leadership in numerous segments and markets in based on our claim to innovation leadership, our highly attractive product offering as well as the consistent strategic focus on brand strength. Based on these success drivers, BMW Motorrad is well-positioned for the future and so I approach the year 2025 with a very positive outlook.”
His boss, BMW Group chief executive Oliver Zipse, pointedly disagreed, though, against the background of Donald Trump’s raging global trade war. Zipse had just warned investors that EU, US and China tariffs will cost the group an additional €1bn at least this year, after profits fell by 36% in 2024. Group earnings before tax had dropped to €11bn last year, compared with €17bn in 2023.
€-£ currency translation at forex rates applicable on 14 March
DUCATISTA PASSION THROBS ON?
Despite admissions of a particularly challenging competitive environment and market conditions in 2024, Ducati chief executive Claudio Domenicali and his chief financial officer Henning Jens managed to fall back on the excuses of protecting overall profitability and prioritising long-term sustainability, rather than just aiming for increased sales volume. Hopefully, this will secure Ducati’s presence on the bottom rung of Volkswagen’s Audi-led Brand Group Progressive luxury ladder, which also harbours Bentley and Lamborghini. Last year, Brand Group Progressive had struggled to turn over about 50 billion quid, to yield an operating profit barely reaching three billion. Shortcomings at Audi were largely responsible for those woes.
Having said that, Ducati’s full-year financial outcome wasn’t exactly enthralling either. Annual revenue fell by 5.8% to £844.3m, narrowly scratching up past the billion euro mark for a third consecutive year. But operating profit was a painful 18.4% down to £76.6m, allegedly influenced by negative forex effects and higher depreciations. Operating margin dropped from 10.5% to 9.1%.
Total worldwide retail sales declined by 6.4% to 54,495 units, reportedly reflecting both the aforementioned tough market conditions and fierce competition. The Dual/Hyper bracket of Hypermotard, DesertX and especially cash-cow Multistrada models did best, with customer deliveries 13.4% up to 23,092. The Scrambler sub-brand did worst, 24.4% down to just 6217. The Naked/Sport Cruiser segment’s Diavel, Monster and Streetfighter range shrank by 18.7% to 15,220. The Sport slot, armed with Supersport and Panigale kit, dropped by 8.7% to 9966.
European countries accounted for 60% of sales, rising from 57%. China, including Hong Kong, fell to just 4% from 5%. The USA’s slice slipped to 13%, from 14%. Various other markets were responsible for 24%, against 25% in 2023.
Ducati’s full-year production crept higher by a mere 1.3% to 55,956 units. Dual/Hyper claimed the lion’s share, 30.9% up to 24,546. Sport was 3.5% down to 10,531 and Naked/Sport Cruiser down by 12.8% to 14,799. Scrambler took a 29.2% dive to 6080.
For 2025, Ducati is dependent on ten new models, which it says will enrich an increasingly complete, sophisticated and technologically advanced range. These include the XDiavel V4 and Multistrada V4 with V4 Granturismo engines, Panigale V4 and Streetfighter V4 models with the latest Desmosedici Stradale engine, plus Panigale V2, Streetfighter V2 and Multistrada V2 models, all featuring the lightest twin-cylinder motor ever made by Ducati. And there’s a motocrosser available in selected dealerships too – the success of all no doubt predicated by difficult circumstances evaporating imminently.
€-£ currency translation at forex rates applicable on 18 March
PONTEDERA PRAYS FOR MERCY
Trying desperately to cover the cracks in yet another struggling big-league European biker enterprise, Piaggio managing director and chief executive Michele Colaninno has his work cut out. 2024 full-year Piaggio Group consolidated sales revenue fell by 14.3% to £1.416bn. Turnover from the EMEA regions (predominantly Europe) and the Americas was 11.8% down, while Asia Pacific declined by 32.4% and India by 3.9%.
Annual operating profit posted an 18.2% retreat to £122.9m and operating margin sank from 9.1% to 8.7%. Pre-tax profit suffered a 28.1% dive to £81.4m. Finally, net profit finished 26.2% in arrears at £55.9m. Group net debt on 31 December 2024 had risen by 23% to £444.3m, versus the position 12 months earlier. This “temporary increase” was shrugged off as reflecting a reduction in trade payables and the trend in capital expenditure. The latter had grown by 12.2% to £152.2m during the year.
Piaggio’s 2024 global powered two-wheeler unit sales volume fell by 17.5% to 359,000 scooters and motorcycles. Associated revenue generated was 15.3% down to £1.083bn, including £127.6m from spares and accessories. The largest PTW downturn at a geographical level was in the Asia-Pacific region, affected by a 30.8% fall in demand for premium products in China and Thailand. India achieved a 10.3% turnover improvement, largely thanks to introduction of two new Aprilia RS 457 models.
In the scooter segment generally, Piaggio claims to have recaptured leadership of the European market with a 21.4% share. And its share of the North American market reached 28.1%. As for motorcycles, the market apparently had a strong response to the aforementioned Aprilia RS 457 models, as well as Moto Guzzi Stelvio and V85 models.
The company also boasted that 2024 had been a year of outstanding results in motorcycle racing for Aprilia, as its Tuareg model dominated the season, winning all the competitions in which it took part. These included the Transanatolia Rally in Turkey and the Italian Motorally Championship. And riding an Aprilia RS 660, Alessandro Di Mario had won the MotoAmerica Twins Cup.
To conclude, why should I deny an Italian Captain of Industry the right to embarrass himself, a specialism at which Michele Colaninno seems to cherish?
His commentary on these results began by hailing “excellent margins in 2024 thanks to careful management of productivity in a highly anomalous economic situation.” Sorry, Michele, but the notion of excellence doesn’t really fit with falling revenue, operating profit, pre-tax profit and net profit, set alongside rising debt.
And then he eulogised harsh reality. “The downturn in revenues is the direct consequence of the correct strategy employed by dealers all over the world to reduce their inventories,” opined Colaninno. “This enabled us to maintain the profitability of the distribution network and simultaneously prepare for 2025 from a pragmatic perspective. A reversal in global economic trends that would generate a solid recovery in consumer spending has not yet emerged!” That’s probably enough for those of us who don’t want to jump in the deep end wearing concrete boots.
€-£ currency translation at forex rates applicable on 4 March