Industries are always buzzing with rumors. And the volume of buzz increases during very good and very bad times. I hear a lot of them, but most of the time I don’t pay attention until I have tangible proof that the rumor is fact. During these last two months I heard a persistent rumor coming from my friends in Italy (as you can guess I have many industry friends in Europe). Ducati and Harley-Davidson would consider a strategic merger. As I just said, I don’t blog on rumors, so I stayed silent. Then today Dennis Johnson, Dealernews and Big Twin Dealer Senior Editor, advises me of an article just published by the very serious Financial Times and titled “Ducati Would Consider Harley-Davidson Merger Anytime, Ducati CFO Says”. Now I feel free to talk & write. Surprising? Yes when I heard the rumor 2 months ago. Not anymore because I had the time to think about it and although I am not a specialist at reading, big corporations financial statements, at analyzing EBITDA, and at justifying any buyout/merger/acquisition opportunity, it makes sense. Think about the alliances in the car industry between American & European companies. Some were very good, some turned bad. In this post, I am not going to explain the “total complementary” between Ducati and Harley-Davidson. I send you to the Financial Times article. It’s important news and if the merger happens, it can change all the landscape of the motorcycle industry and the way we do business. So, more than ever, after you read the Financial Times, feel free to comment.
Wonder how Buell figures into this. It seems as if Ducati’s main (actually whole) line is comprised of sport bikes. As this is the reason Harley bought out Buell, to gain a toehold in the sport bike genre, I wonder what the reasoning behind this would be.
I like Ducati’s, I think they sound great, and run like hell’s on their heals. Guess we’ll have to wait and see.
Harley failed to acquire a strong position in the sport segment with Buell. An alliance with Ducati seems appropriate. Great complementarity.
If you follow Wall Street and the Harley-Davidson stock, you know that analysts expect a drop in sales from 10 to 12% for April and May, the most important sales months for factory bikes. Harley dealers complain that their margins are getting lower and lower due to heavy promotional incentives. It’s very disappointing because Harley released this year many new models. Ducati is not in very good shape but build great bikes. I see not a merger but an alliance for technology exchange and distribution. Ducatis in all Harley dealerships and Harleys on Ducati show floors. It makes sense. Even people like Ness sell Ducatis.
Burgers taste good with spaghettis!
I do not think it will happen.Buell has to much trick stuff in coming out and it has nothing to do with Ducati.
Mamma mia! Where can I buy a Buelcati?
Funny Matt. Imagine a Harley as fast as a Ducati.
The new 1098 model retails for $14,995. That’s $4,200 less than the Street Rod which it will run circles around. Ducati owners are very similar to Harley owners in their brand loyalty. Plus Harley dealerships have customers who can shell out $15K for a sport bike. It would give HD credibility in the super bike market (one that Buell never did), and finally give Ducati a dealer network that can give them mass market exposure here in the US. I would love to see it!
Jim
Well,
In “the bad ol-days” an SS built before lunch was palatable. I’ve heard a dealer say that an “after-lunch” model was said to have required a full up rebuild to give the same level of performance (which was marginal by today’s standards).
As i recall, Ducati became dominant in super-bike racing after an obvious massive high-tech Engineering effort (applying technology along the lines of F-1 car racing).
That type of activity required a massive-major-big-time cash source. Where that money come from…? Who knows. I do recall hearing rumors of a Columbian drug lord who loved the brand…..:-)
However, one thing is certain, the basic Ducati engine design lends itself to such an engineering effort a hell-of-a-lot better than the sportster motor. How much money would it take to get a sprotster motor to dominate super bike racing….? I doubt there’s a business case such an effort.
Didn’t Harley try this in the 1960s with another successful Italian motorcycle maker called Aermacchi? Harley wanted a small displacement entry level line of motorcycles, and Aermacchi wanted to get into the important US market. That didn’t last. Have times changed that much in four decades?
Buzz Kanter
http://www.AIMag.com
Buzz, i think that this time it can work. I read somewhere that the average age of a Harley rider is now 55! The average age of Ducati rider is 35. Half of Ducati owners in the US own a Harley. A merger or alliance is a good solution for both brands.
Has motorcycling changed in four decades? Has the industrial business climate changed in four decades? Have you and I changed in four decades? Damn right! Some of those changes for the best, others not so. History can teach us lessons but it’s not necessarily a predictor of the future.
Cooperation between H-D and Ducati presents some exciting possibilities. Just the fact that the two companies are talking is interesting and speaks to a more open-minded/less myopic view of the industry. No matter the outcome, I applaud them both.
I hope I do not get any frowns from the motor co due to my affiliation with them, but I would applaud this relationship as well. I would venture to say somthing like this would play the overall “cool card” with the younger enthusiasts out there.
A large step towards accomplishing their goal of enhancing awareness of their brand to this group and eventually introduce them on a Harley-Dvidson product, a few years after their finished with their g-force training. I am not sure how this merger would sit with the Buell folks……… Buellcati?
Marilyn is right. That it happens or not (the merger)is less important than to realize that through talks and negotiations our industry shows it is alive. All tentatives to attract more people to our sport deserve positive reactions from the bikers community.
Since I uploaded this post Monday evening I received close to one hundred emails sent directly to me. Please, please, please, post your comments here for everybody to read. You also ask my personal reaction on this possible merger between Harley & Ducati. Here it is. I wish it happens, I want it to happen, I pray it will happen. I just hope that nationalist egos will not interfere during the financial negotiations. We live in ONE motorcycle world.
Hello, I own a Ducati 1999 900 SS and a K6 Suzuki GSXR 1000 and previously I’ve owned a Harley Davidson Sportster and a Kawasaki ZRX 1100. My father and Grand father grew up on Harley Davidsons, as my Grandfather was a WWII veteran, naturally, I ended up having a Harley Davidson as my first full size bike. Giving it a try, I understood the freedom and image the Harley Brand had to offer but being in my twenties at the time, it was not yet my type of riding. So, being influenced by the reputation of a marque rich in history, my immediate alternative to the Harley was either a Ducati or a Triumph. Being keen on research and performance I chose a Ducati, as it was the only non-Japanese bike competing in World Championships, not to mention beating most of them! As a person born into the Harley world, the Ducati was the bike that grabbed my attention. So with this, I would have to say that the merge does make sense. Both V twins, both rich in History, both motorcycle icons——-BMW and the Big Four must be shaking in their boots…wait, that’s just the roar of the DUCATI and the HARLEY twins rumbling on through. And yes, when I’m old and grey, I will be on a Harley (A promise I made to my father and Grandfather), hopefully one with a trellis frame and Ducati like power…..
harley is forecasting another change and beating the other brands to the punch..avg. age ducati guy 35…he will eventually give up going fast or sport touring fast as he ages..what better way to shift more of the market as the post says ducati people are loyal they will suffer with a bad product just because its a ducati…sound familliar? what better way to stay loyal than to buy a harley which owns the ducati brand and keep it in the family. as the ducati riders age they will easily slide onto a harley. where as if there was no affiliation they would be able to roam the isles of honda, kawasaki, and such. their is no technology bonus for h.d. they already have ford and porche,jaguar peoples brains and computers to be picked..its all about reading the fluctuating market and hopefully staying a step ahead. i wish them luck. but they wont need it.
I agree with Cyril. It needs to happen. Harley is not ready with new models to attract the sport bike guys. Buell has never been a success. Ducati has a strong positive image, like Harley. Together they would make a killing.
Let’s all write/email to Harley and Ducati to tell them we want it to happen
This is a perfect time for a merger or alliance. With Ducati’s domination in Super Bikes for so long, and now in Moto GP with Aussie Casey Stoner aboard, the brand Ducati has never looked better and could only be complementary to Harley-Davidson. Plus it would help Ducati sales in the US where they have traditionally been poor. And, all those younger riders eyeing Harleys in the joint showrooms would get the message just how far the Motor Company has come.
Doc Robinson
Makes sense-
HD has build a distribution and servicing network second to none- in fact, it’s far greater than what they really need for their present lineup….. Do I really need access to a dozen large dealerships in my area to buy more t-shirts?
Ducati has traditionally been plagued by poor management and a piecemeal service/distribution network- this deal will hurt the Moto-Guzzi/Triumph/eurobike shops that have been lumping the Ducati brand into their fold in order to survive.
Will Ducatis canibalize Buell sales? Perhaps, but I don’t think they really overlap much now, anyway;
Buell is price sensitive- can’t price a Buell above a Dyna, so Harley is effectively capped on the profitabilty of Buell… But a Ducati 1098? BIG FAT profit margin there…
Plus, think of all the NEW t-shirts my dealers can sell me now…..
They’ll do it for that reason alone- lol.
Hmmmmmmm…
“…give Ducati a dealer network …”
In the same shop with Buell…?
“…avg. age ducati guy 35…”
I don’t see the marketing issue
“…Both V twins, both rich in History…”
All dogs have 4 legs, but my cat won’t hang out with any of em.
“…an alliance for technology exchange…”
Technology to do what…..?
Yes:
“…Wonder how Buell figures into this…”
“…Buell has to much trick stuff in coming out …”
How much $$$ does Harley have in Buell?
And can they walk away from it…..?
Maybe i’m missing something, but i just don’t see the business case
nicker
Nicker, you don’t understand. Ducati & Harley could be sold under the same roof. Ducati dominates the racing technology and can help Harley. Ducati needs to extend its network. Harley needs to find young buyers. Young buyers will get older and switch from Ducati to Harley. Get it?
Does anyone know a time frame on this possible merger–or has anyone heard about the new 2008 HD lineup.
Check this link for someone combining a Harley and Ducati motor:
http://thekneeslider.com/archives/2007/06/17/desmoharley-a-real-ducati-harley-davidson-merger/#more-1464
Actually, I think the young buyers would be more a focus of Buell, not Ducati…
Buell is capped price-wise, so they can continue to represent entry-level and price sensitive customers. Buell is never going to be able to distinguish themselves sufficiently from the Harley brand in order to enable a pricing premium over, say, the Dyna lineup; People will simply balk at paying for for a Buell than a Dyna.
However, Ducati seems to have absolutely no problems selling 1098’s for $16K ; In addition, Ducati fans are big spenders in the accessory market- $3500 for carbon fiber wheels? Tasty……
Ducati buyers appear to have plenty of money to spend, and THAT is what Harley cares about- incremental revenue. There are a lot of cross-selling opportunities between Harley and Ducati products.
Ducati has a pretty wide product mix model-wise, but not a lot of their stuff is priced at entry level; I just don’t see much overlap between Buell and Ducati, so they could co-exist;
Eh, then again, the new Ducati Hypermotard sure turns my crank a lot more than the “weird harold”-looking Ulysses thing from Buell- lol.`
Drive down the price point a bit on some of the Ducati’s, and I won’t care about Buell-
Harsh but true.
It would help shake up a stagnant HD line, and bring some new buyers in the front door. I hope it happens.
I think that this guy Walter Roehrich use to work for Ducati and now set out to build the ultimate American street bike. The bike looks like a Ducati but, with the Harley Davidson Revolution engine. The technical specifications look like the 1098. Visit the web site roehrmotorcycles.com
teego
Oh NO!
i despise Harleys and the way of life, evething they represent is so awful, loathsome – then i never can touch a Ducati, anymore. i’m crying.
keiyyo
WOW Keiyyo how did you ever get on this blog if you despise everything Harley and its way of life. You must be lost and need to find your way home.
John;
M pint was: what’s the business case for selling a Buel and Duc out of the same showroom….?
Your saying that the guy buys a Duc when he’s young and then one day decides he’ll trade it on on a Buel…?
I’ve been a BMW GS rider for decades. 3 months ago I bought a second bike. I looked at Ducati and Harley. For me, it all begins with the purity of the motor. The old Ducati GT750 motor was great, but the new engines have too much stuff hanging off of ’em. Not good for the naked look I wanted. Also the sound of the Ducati – that whirring chain sound – also not good.
I bought a Harley Dyna and I absolutely love it. The merger would be great if Harley could take what it has mastered in engine evolution (keep the soul but improve the heart) and bring that to the Ducati.