Thursday, June 20, 2024


BDN financial editor Roger Willis has been analysing the latest annual and quarterly results from the major manufacturers.

Full-year results to 31 March 2019 for Honda’s motorcycle business reached all required targets in fairly spectacular fashion.

Honda-branded sales volume roared through yet another barrier, 3.5% up to a staggering total of 20.238 million bikes. Some 13.215 million of these were made by wholly-owned subsidiaries, the rest by joint-venture affiliates.

Asia accounted for most of the headline tally, rising by 2.8% to 18.224 million. Within that, four countries — India, Indonesia, Thailand and Vietnam — were together responsible for 14.502 million, a 3.5% increase. Other emerging-market regions, led by Latin America and West Africa, put on 12.2% to 1.257 million.

In the more lucrative developed world, Europe stood out with a 6.4% volume improvement to 249,000. Japan’s domestic market grew even faster, adding 24% to 207,000. North America fell by 3.8% to 301,000.

Records were also broken in monetary terms. Revenue from motorcycles was 3% higher at £14.665bn, delivering a 9.2% rise in associated operating profit to £2.036bn. Operating margin was raised to 13.9% from 13.1%.

As BDN recently anticipated, the performance of Honda’s car operations proved to be lamentable by comparison, with operating profit plunging by 43.9% to £1.464bn — despite a vastly larger turnover of £78.819bn.

However, Honda is being extremely cautious about immediate prospects for its motorcycle division. The results statement noted that previously rampant sales in India’s enormous market had begun to slow, falling by 4.4% to 5.52 million, owing to an onerous revision of the Indian mandatory vehicle liability insurance requirement. And this is likely to have an impact going forward into the new fiscal year.

The introduction of stricter environmental regulations in most major Asian countries is also expected to cause a sales decrease until compliant models can be launched. And various problems are visible elsewhere.

In response, Honda is forecasting very marginal worldwide volume growth of 0.06% to 20.25 million units over the next 12 months. Asia could be 0.2% lower at 18.18 million. Europe and Japan respectively are predicted to lose 3.6% to 240,000 and 3.4% to 200,000. Countering these retreats, the company believes North America is due for a 6.3% recovery and Latin America will bounce back too.    


Annual results for the motorcycle division of Kawasaki Heavy Industries contrasted rising sales volume and revenue with deteriorating profitability.

For the 12 months of its fiscal year to 31 March 2019, Kawasaki’s bike business enjoyed an above-forecast 7.6% revenue increase to £2.477bn. But operating profit was 5.8% down at a mere £100m and operating margin dropped from an already puny 4.5% to 4%. Higher marketing, admin and raw material costs were mainly blamed for these declines. Four-times World Superbike champion Jonathan Rea’s extravagant wages weren’t deemed worthy of a mention.

Wholesale motorcycle volume shipped to dealers in developed countries, principally across Europe and North America, climbed by 8.6% to 165,000 units. Associated turnover was 8.1% up to £914m. Motorcycles for emerging markets, mostly in Asia, rose by 12.6% to 385,000 units — yielding a revenue hike of 9.1% to £640m.

Sales of utility vehicles, quadbikes and personal watercraft improved by 6% to 70,000 units, with related turnover 4% up to £562m. General-purpose petrol engines added 9.5% to £361m. 



Among quarterly results, Yamaha profitability was hit by problems with its bike business, particularly in developed-world markets.

Just to muddy corporate waters somewhat, Yamaha has rolled power products (ATVs, golf buggies, etc) and pedelecs in with core motorcycling activities to form a new Land Mobility division. And for the opening quarter of its 2019 fiscal year, headline results were referring to this amalgamated unit. Land Mobility overall revenue was 3.9% up to £1.913bn. But operating profit plunged by 37.4% to just £65m.

Numbers exclusively applicable to motorcycles show a revenue rise of 3.2% to £1.696bn and operating profit 43.6% down to £55m. Total wholesale shipment volume for the period was 0.8% higher at 1.247 million bikes.

Emerging markets were primarily responsible for the big figures. Asian volume put on 1.6% to 1.056 million machines, yielding a 4.5% revenue increase to £1.116bn. But in other regions, predominantly Latin America, volume shrank by 12.9% to 101,000 and revenue was 11.9% down to £170m. Combined emerging-market revenue of £1.286bn was 2% up, although related operating profit suffered a 20.6% decline to £96m. Falling sales in Taiwan, Vietnam and Argentina, despite increases in the Philippines, Brazil and India, were blamed.

Developed markets proved even less fruitful. Although North American volume grew by 5.9% to 18,000, revenue was 8.2% lower at £78m. Japanese domestic sales dropped by 12.5% to 21,000 and revenue by 11.7% to £58m. Revenue from Oceania (Australia and New Zealand) slid by 3.6% to £19m. At first glance, the best news came from Europe, where volume improved by 24.4%  to 51,000 and revenue stacked on 19.7% to £257m.

But then Yamaha qualified optimism by mentioning substantial euro-yen foreign exchange losses and increased “growth strategy” costs impacting income. So while total developed-world revenue was 7.1% up to £410m, an associated operating loss of £41m emerged — compared with a loss of £24m in the same period last year.

For Yamaha as a whole, revenue increased by 5.9% to £2.976bn. Operating profit was 12.8% down to £249m and net profit fell by 12.6% to £218m.               


Piaggio Group, Europe’s largest powered two-wheeler manufacturer, achieved solid growth during the first quarter of 2019. Consolidated revenue rose by 10.8% to £287.7m. Operating profit was 42.6% up at £17.8m and operating margin improved to 6% from 4.6% in the same period last year. Net profit almost doubled, climbing by 97.7% to £6.7m. Net debt fell by 9.3% year-on-year to £392.2m.

Sales of scooters, motorcycles and related P&A were responsible for about two-thirds of Piaggio’s total revenue, rising by 7.9% to £194.9m. Global volume was 5% up to 84,600 machines.

Strongest performance came from the Asia Pacific region, where volume grew by 16.8% and revenue contribution by 26%. European volume made a more modest 4.1% gain with associated revenue 5.1% up. Indian revenue increased by 7.2%, thanks to a better model mix, although volume contracted slightly. Piaggio scooter brands maintained sector leadership in Europe with a 23.2% market share.

Motorcycles also boosted quarterly turnover, thanks to the Moto Guzzi brand’s 24.5% wholesale shipment increase. This was largely driven by demand for its new V85TT retro adventure bike, which was distributed to dealers at the end of February. 


Harley-Davidson’s performance in the first quarter of 2019 continued to be desperate, despite plenty of upbeat flannel from its chief executive Matt Levatich. Total revenue for the three months was 10.2% down to £1.068bn, as wholesale shipments to dealers worldwide fell by 7.9% to 58,891 bikes. Operating profit plunged by 29.3% to £129m and net profit was 26.8% lower at £98.8m.

Global retail volume slid by 3.8% to 49,151 motorcycles. Domestic sales were 4.4% down to 28,091 — at least beating a 4.7% quarterly retreat for the overall 601cc-plus market in the US and thereby increasing share very slightly. International numbers were 3.3% down to 21,060. European volume dropped by 2.1% to 9508, against a 0.6% fall to 10,797 for the EMEA region within which it resides. Asia-Pacific countries, with Japan and Australia as major players, lost 4% to 6074 — although Harley claimed its new manufacturing plant in Thailand has just begun to boost sales in the ASEAN trading bloc.

The company also said worldwide retail sales during the quarter were impacted by limited availability of Street models, due to a recall announced in January.

Harley supremo Levatich said: “We are acting with agility and discipline to take full advantage of rapidly evolving global markets. US market share growth and retail sales performance in the first quarter are further evidence of the effects we are having as we continue to implement and dial-in our More Roads efforts. We are driven by our unparalleled rider focus and deep analytics that are guiding our efforts today and into the future. We, along with our dealers, are determined to lead and stimulate global industry growth.”   


BMW Motorrad boasted a return to all-parameters positivity in its results for the first quarter of 2019. With an impressive surge of new models factored in, led by instantly successful R1250GS variants, BMW sales volume during this three-month period grew by 7.7% to 38,606 motorcycles and maxi-scooters. March accounted for almost half of them, 9.9% up to 18,931.

Quarterly revenue climbed by 11.8% to £501.6m. Operating profit was 15.6% higher at £76.2m. Operating margin improved to 15.2% from 14.7%. Pre-tax profit rose by 11.5% to £74.5m. 


Substantial revenue improvement concealed a challenging first quarter for US powersports manufacturer Polaris. During the opening three months of its 2019 fiscal year, turnover grew by 15.3% to £1.156bn. But operating profit was 1.6% down to £63.3m and net profit slumped by 13.2% to just £37.4m.

Revenue in the company’s core off-road vehicle (ORV) and snowmobile division was 4.2% up to £670.6m, driven primarily by an increase in ORV wholesale pricing. But as usual, Polaris obfuscated the detail and avoided revealing product volume figures.

Total North American ORV retail sales dropped by a “mid-single-digit” percentage, which presumably means about 5%. Within that, side-by-side ATVs were down by a “low-single-digit” percentage and quadbikes fell by a “low-double-digit” percentage. Being kind to under-educated accountants in the wilds of Minnesota, we assume the company thinks that represents around 12%. But it might not, considering 99% is a “high-double-digit” percentage.

The smaller motorcycle division suffered greater woes. Quarterly revenue was 10.3% down to £91.2m. Declining Slingshot trike sales were held largely responsible but Indian cruisers also took part of the blame.

In North America’s struggling bike market, combined retail sales of the two brands were described as shrinking by a “high-single-digit” percentage. Indian was assaulted by a “mid-single-digit” percentage fall while Slingshot went backwards by a “low-double-digit” percentage.

Polaris actually trousered better revenue from its recently acquired boat business in the period — £142.9m — than it did from bikes. And boats were five times more profitable at gross level.  






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