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11 NOVEMBER: WEEKLY MOTORCYCLE INDUSTRY SHARE PRICES

A snapshot of global bike and ATV industry share performance at the trading week closure on Friday, 11 November, 2016.

Although liberal intelligentsia and commentariat on both sides of the Atlantic were shocked and dismayed by Donald Trump’s victory in the US presidential election during the past week, investors celebrated his promise of a much more business-friendly new administration with wild abandon. New York’s S&P 500 index hit a post-election daily peak of 3.9% up on Thursday before euphoria fatigue set in and it fell back to close on a weekly gain of 3.7%.

The biggest winners were US rust-belt industrial stocks, likely to benefit from Trump’s anticipated tariff-led protectionism against Chinese and possibly Japanese imports. All-American manufacturers of typical redneck consumer items — such as motorcycles and ATVs — who will also cash in from blue-collar employment and wage boosting policies — were among them.

Naturally, the share price of redneck favourite Harley-Davidson got a useful hike, briefly surging above 60 bucks and settling on a 5.6% rise for the week. Strangely, Polaris got an even better seat on this bandwagon, climbing by 17.2% despite the embarrassment of having transferred much of its ATV production to cheap-labour Mexico — a demonised campaign target for the president-elect. Expect that to be repatriated north of Trump’s imminent Mexican border wall in short order, to escape punitive tariff sanctions.

European markets also felt the same vibe, with the Eurofirst 300 index peaking 3.4% up and closing at a 2.8% weekly improvement. BMW and Daimler, both of which manufacture cars in the US and will be tariff-free already on those products, respectively rose by 6.5% and 5.1%. VW, which no longer does much in America apart from paying fines and compensation due to well-advertised emissions difficulties, only added 1.5%. KTM, on the other hand, sells lots of dirt bikes there and now has the prospect of selling a lot more in any reviving market. So its stock leapt upwards by 6.6%. Piaggio managed a below-average 2.1% gain.

Japan profited from a different Trump-related aspect — a substantial post-election weakening of its yen against the US dollar making Japanese exporters happy little fellows. The Nikkei 225 stacked on 2.8%, a figure far out-classed by that country’s four motorcycle producers. Kawasaki was king, 9.4% up. Suzuki followed, rising by 7.4%. Yamaha stock added 5.9% and Honda 4.5%.

The emerging world was characterised by dramatic contrasts. After a temporary mid-week plunge driven by a moment’s panic about Trump’s anti-Chinese rhetoric, Shanghai reverted to normal upbeat service and its Composite index finished 2.3% up. Most of China’s motorcycling assets were positive week-on-week. Sole exception was Yamaha’s chum Jianshe, posting a very slight reversal.

In India, a sudden government edict that all 1000 and 5000 rupee banknotes — more than 80% of the paper money in circulation — had ceased to be legal tender on Thursday plunged the Indian economy into turmoil. Motivation was to scupper widespread tax avoidance by forcing large cash holdings into taxation-transparent bank accounts but the impact on consumer confidence was understandably enormous.

Most motorcycle purchases in India are paid for in cash. So sales hit an immediate buffer and are probably going to remain muted for some time. As a result, every bike stock without exception plummeted on Friday. Hero, Eicher and Mahindra incurred the worst losses translated to a weekly basis, respectively down by 9.5%, 9.4% and 9.6%. TVS was slightly better, falling by 7.9%. Bajaj, as the largest exporter among them and therefore partially immune, got away with a 5.9% drop.        

                               

Price (P) Daily change (C) 52-week range (R) One-year investment return (Y) 

 

USA (US dollar)

Harley-Davidson    P 59.00  C -0.74%  R 61.35 – 36.36  Y +27.94%

Polaris    P 89.91  C +0.42%  R 111.72 – 67.80  Y -14%

Arctic Cat    P 15.11  C +1.96%  R 22.53 – 8.90  Y -22.58%

US Highland    P 0.0006  C +50%  R 0.43 – 0.0002  Y N/A

Confederate    P 0.04  C -2.44%  R 0.33 – 0.04  Y N/A

Notes: Polaris makes Victory and Indian bikes, ATVs, snowmobiles, quadricycles and EVs. Arctic Cat makes ATVs and snowmobiles. US Highland makes off-road bikes. Confederate Motors makes limited-edition cruisers.

 

CANADA (Canadian dollar)

BRP    P 23.46  C +0.13%  R 27.30 – 13.76  Y +1.78%

Notes: Bombardier Recreational Products makes Can-Am ATVs and Spyder road trikes, Ski-Doo snowmobiles, Sea-Doo PWCs and Rotax proprietary engines.

 

TAIWAN (Taiwanese dollar)

Sanyang    P 20.15  C +0.5%  R 23.90 – 19.80  Y -2.43%

Notes: Sanyang Motor (SYM) is the leading Taiwanese bike manufacturer.

 

VIETNAM (Hong Kong dollar)

VMEPH    P 0.51  C +9.68%  R 0.53 – 0.36  Y +6.25%

Notes: Vietnam Manufacturing & Export Processing Holdings, a JV partner of SYM, is the third-largest Vietnamese bike manufacturer.

 

INDONESIA (rupiah)

Astra    P 7700  C -7.23%  R 8875 – 5700  Y +19.48%

Indomobil    P 1350  C -4.26%  R 2755 – 1250  Y -48.71%

Notes: Astra International is a Honda JV partner. Its controlling shareholder is British conglomerate Jardine Matheson. Indomobil Sukses Internasional is a Suzuki JV partner.

 

EUROPE (euro)

BMW    P 79.86  C +4.24%  R 104.85 – 63.38  Y -11.45%

Daimler    P 64.61  C +1.54%  R 85.50 – 50.83  Y -10.36%

VW    P 128.58  C +1.24%  R 146.50 – 106.65 Y +9.75%

KTM    P 4.39  C +0.92%  R 4.65 – 3.14  Y +38.3%

Piaggio    P 1.47  C +0.41%  R 2.42 – 1.39  Y -35.48%

Notes: Daimler’s AMG-Mercedes subsidiary has a 25% stake in MV Agusta. Volkswagen Group owns Ducati.

 

PAKISTAN (Pakistani rupee)

Atlas Honda    P 605.00  C +0.01%  R 620.00 – 349.60  Y N/A

Pak Suzuki    P 538.00  C +0.22%  R 595.00 – 363.01  Y N/A

Notes: Atlas Honda and Pak Suzuki are JV assembly partners.

 

INDIA (rupee)

Hero    P 2975.30  C -5.41%  R 3740.00 – 2375.00  Y +16.43%

Bajaj    P 2647.60  C -2.9%  R 3122.00 – 2171.95  Y +13.91%

TVS    P 361.80  C -4.58%  R 420.00 – 256.00  Y +23.52% 

Eicher    P 21,685.20  C -5.99%  R 26,641.30 – 14,800.00  Y +39.55%

Mahindra    P 1240.20  C -6.14%  R 1508.95 – 1091.25  Y -0.07%

Maharashtra    P 1726.30  C -5.67%  R 2170.00 – 1056.00  Y +33.71%

Scooters India    P 37.60  C +0.27%  R 44.85 – 22.65  Y +27.89%

Notes: Hero MotoCorp is a former Honda JV partner. Bajaj has a major shareholding in KTM and ties with it and Kawasaki. TVS is a former Suzuki JV partner and BMW Motorrad contractor. Eicher makes the Royal Enfield brand. Mahindra & Mahindra has an own-brand bike range, a majority stake in French scooter brand Peugeot and owns formerly British BSA brand rights. Maharashtra Scooters assembles CKD scooter kits manufactured by Bajaj. Scooters India makes Vikram three-wheeled taxis and light trucks.

 

JAPAN (yen)

Honda    P 2998.5  C +0.6%  R 4123 – 2417  Y -22.82%

Yamaha    P 2442  C +0.58%  R 3045 – 1409  Y -12.91%

Suzuki    P 3838  C -4.48%  R 4069 – 2450  Y -0.11%

Kawasaki    P 315  C +3.96%  R 500 – 257  Y -33.05%

 

CHINA (yuan)

Qianjiang    P 19.99  C -0.36%  R 20.48 – 6.71  Y +82.22%

Zongshen    P 10.35  C -0.1%  R 18.20 – 8.08  Y -33.65%  

Sundiro    P 9.52  C N/A  R 9.94 – 5.61  Y N/A [Trading halted]

Jialing    P 9.52  C -4.7%  R 10.99 – 5.67  Y +4.04%

Lifan    P 9.95  C +0.81%  R 19.47 – 8.05  Y -33.32%

Loncin    P 21.65  C +1.69%  R 25.52 – 14.80  Y +2.53%

Linhai    P 13.80  C +1.02%  R 14.71 – 8.41  Y N/A

GAG    P 24.91  C -1.11%  R 26.27 – 18.10  Y +4.08%

 

CHINA (Hong Kong dollar)

Jianshe    P 15.56  C +1.57%  R 19.20 – 11.25  Y +26.4%

Notes: Qianjiang owns Keeway and formerly Italian Benelli. Zongshen makes own-brand bikes and proprietary engines, and has JV partnerships with Piaggio, (scooters), and Harley-Davidson (parts). Sundiro is a Honda JV partner. Jialing makes own-brand bikes using Honda licensed technology. Lifan makes own-brand bikes and distributes MV Agusta in China. Loncin is a Kawasaki JV partner and OEM engine contractor to BMW Motorrad. Linhai and Jianshe are Yamaha JV partners. Guangzhou Automobile Group (GAG) is the parent of Honda JV partner and own-brand bike manufacturer Wuyang.

 

MALAYSIA (ringgit)

Oriental Holdings    P 6.95  C +2.06%  R 7.52 – 6.48  Y +2.82%

Hong Leong    P 9.79  C N/A  R 10.08 – 5.25  Y +65.86%

Notes: Oriental Holdings is a Honda JV partner. Hong Leong Industries is a Yamaha JV partner.

 

SOUTH KOREA (won)

KR    P 919.00  C +0.22%  R 1770 – 833  Y -9.01%

Daelim    P 82,400  C -0.12%  R 94,300 – 62,000  Y +15.6%

Notes: KR Motors makes Hyosung bikes and ATVs. Daelim Industrial retains a controlling 59% stake in Daelim Motor, the largest bike manufacturer in Korea. (The remainder is British, owned by Standard Chartered Bank.)

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