A Dealer Point Of View. What Went Wrong With Factory Customs.

Charles Strand of “Iron Horse Of Texas” sent me the following letter. In it, he explains his views on the state and the future of the “mass produced custom motorcycles” market.  It’s long but worth reading it. As always, I welcome your comments. 

“In the 5 years that I’ve been on the retail side of this very unsophisticated industry, I’ve seen an evolution that any good business person could have predicted many years ago. For 6 years prior to becoming a Dealer, I was on the manufacturing side of the industry as a founder and Board member of American IronHorse. Prior to 2004, when we opened Iron Horse Of Texas, the demand for Customs far exceeded the supply and bad industry attitudes were developed. Unfortunately, many of those big egos and bad attitudes still exist today. Attitudes from manufacturers that Dealers are lucky to get bikes and have someone willing to take their money. Attitudes from Dealers that customers could take it or leave it as supplies were limited and therefore justified a price $3000 to $10,000 over MSRP. Because of these attitudes, the door opened for more competition, everyone with a tattoo and an attitude wanted to get into the Bike Business… and did! Regardless of what anyone thinks, the “Bike Business” is still “Business” and without good inventory management, good customer service, good consumer financing… there won’t be a custom market.This last year in Sturgis, at the request of American IronHorse (AIH), and along with 5 other AIH Dealers, I oversaw a “Prior Year Model Close-Out Sale” at the Sturgis Rally where we sold over 100 motorcycles in 8 days. I’ve heard remarks from some of our “Industry Icons”, “Industry Idiots” would be more accurate, as to how we “prostituted the market” by selling new 2005 & 2006 models at $6000 to $8,000 off normal MSRP when 2008s were being released. This demonstrates the ignorance that dominates our industry. During the same time frame, you could buy a new 2007 Hummer (1 year prior model), Corvette or Cadillac for $10,000 to $12,000 off MSRP, 2006s at $15,000 Off! It is the common practice of smart Dealers and Manufacturers to clear out old inventory at discounts. We were selling bikes that were 2-3 year prior models at discounts less than car, boat and RV Dealers were selling 1 year prior models for. Only an imbecile would call this bad business!

Manufacturers have forgotten that the Dealer is their customer and have focused on the intoxicating attention they get direct from the consumer and the media. In past years you saw every back yard builder and Wanna-Be CEO getting their pictures in magazine ads, their girl friends and wives all became bike models and executive assistants and people who could barely spell their own names soared to celebrity status. The industry suffered a “popularity overdose”. Good business practices were thrown out the window. Almost everyone involved in this industry over borrowed, over leveraged, over estimated and under achieved. Now the entire industry is poised for one giant enema, a cleansing long overdue!

As one of the top Factory Custom Dealers in the U.S., I receive 3-5 emails a week from manufacturers who think the answer to slow sales is to strong arm Dealers into buying more of their bikes. Manufacturers who made millions during the “demand exceeds supply era” and now have no idea how to survive in today’s market. People who have clouded their mind to such a degree that they no longer realize that it doesn’t matter how many bikes a Dealer buys, it’s how many they sell that will determine the success or failure of the brand. Here’s my prediction; of the dozen or so companies that make up the main players of the Factory Custom Motorcycle market, 2-3 will survive. Most of them will be taken over and restructured by better business people with more common sense than ego. Eventually, manufacturers will realize that it’s not about them, it’s not about the bike… it’s about the Dealer… and even more so the Salesperson on the Dealership floor. The Dealer who is aggressive and smart enough to know how to market cost effectively and get people into his store and the Salesperson with the ambition, training and the right tools to “close the deal”…that’s where the market potential is, it has little or nothing to do with what brand we are selling. If it was only about the bike, or the market, or the manufacturer… you would see the most sales in the largest territories, plain and simple. Instead, each manufacture, if they will be honest, will admit that the places where they sell the most bikes are where they have the best Dealers. I’ve sat through dozens of so called Dealer Meetings where some “Marketing Expert” from the manufacturer, who likely has never stood on a Dealership floor and sold bikes, stands up and tells us what we are doing wrong or how to increase our sales. In almost every case, I’ve found this to be a good lesson on what not to do! The bottom line is that they have all lost their ability to listen and will soon be replaced with business people with better hearing. Every manufacturer in the Custom Industry is currently in financial trouble. If they don’t figure out what the real issue is, they will all be gone soon.

We sell 250-300 bikes a year from our Dealership in Fort Worth, Texas and turn a modest 400K-500K profit from it. Not like the big boy HD Dealers, but a decent living. We’ve been the top American IronHorse Dealer for the last 4 years. I have screamed, preached, begged and threatened to try and get one of these arrogant manufacturers to step up and realize that the key to this business, as with the boat, RV, exotic cars or any other “luxury purchase” business is good consumer financing, and they have all rolled their eyes and turned the other way. The fact is that they need us, the Dealers, a lot more than we need them. A good Dealer can sell anyone’s product. In 2007, we sold 267 motorcycles, a little over 8M in sales and had a little over 500K in net income as a sole proprietorship. We are in a “B” market, Fort Worth, Texas and have a competitive American IronHorse Dealer, who also believes he’s an “Industry icon”, 36 miles from us. For most of 2007, we had a reasonable source for C&D credit score buyers (550-640), Loud Financial. In October of 2007, Loud Financial bowed out of the Custom Finance market and we lost over 40% of our business and had to go back to sources like HSBC & GE Credit, who will only do A&B Credit deals, 640 scores and above. For the year 2007, 62% of the bikes we sold were to buyers with credit scores under a 640, 2% were cash deals and 36% were A&B tier buyers. Anyone should be able to read between the lines and realize that the key to survival in this industry, or any similar industry, is sub prime finance, without it there won’t be a Custom Motorcycle Industry much longer.

So to all of the manufacturers that continue to blame the Dealers for your decline in sales… wake up, get off your back sides and secure some reasonable finance sources so that your Dealers have a fighting chance. Victory does it, Harley does it… everyone that is “making it” does it. The car business, the RV business, the Boat business… and believe it or not, the motorcycle business… cannot possibly survive on A&B Credit Buyers alone. 3/4s of the U.S. population has a credit score below a 640… including most of you “Industry Icons & Custom Manufacturers”. As a manufacturer, you have a much greater ability to approach finance institutions than a Dealer does as you represent a much larger portfolio and a controlled source for liquidating repossessed units. Anyone in the “non-metric” finance segment will attest that it is good performing paper as bikers almost always prioritize around their bike. But it is significantly harder for a Dealer to approach a lender than it is for a Manufacturer representing a large group of Dealers. According to a top level Bank Of America source I recently met with on this issue; “The American made motorcycle financing is the best performing paper we have out of all other categories…”. It’s not a new concept, it’s what HD did with Eagle Mark that got them to where they are today. It’s what Victory does with “Polaris Acceptance” which is funded by GE. Do your jobs, support your Dealers… or you will soon say goodbye to the Custom Bike Business!

I don’t expect too many manufacturers or Icons in this industry to agree with this reality, but it won’t matter as most of you will likely not be around much longer anyway… I will!”   Charles Strand, Iron Horse Of Texas, Sun Water Systems, Inc. Doss Holdings, Inc.


66 Responses to “A Dealer Point Of View. What Went Wrong With Factory Customs.”

  1. 1 Ridesafe Jun 17th, 2008 at 12:47 pm

    We applaud you! Great job and to the point.

  2. 2 Gar Jun 17th, 2008 at 1:13 pm

    Wow! It is not often I will read such a self serving, back patting, at-a-boy letter such as has been written by Mr. Strand, however, in this case I couldn’t stop myself. With your giant sized belief in your self worth and exceptional business skills possibly your time would have been better served if you had stayed at American Ironhorse. Maybe then Ironhorse would not have failed so miserably. Also, if my memory serves me correctly, the two founders of American Ironhorse were Bill Rucker and Tim Edmondson. I don’t recall your name being associated with theirs.

  3. 3 NEWT Jun 17th, 2008 at 1:47 pm

    Why would anyone in their right mind, insult “Industry Icons” that have been in the business longer and have played a major role in creating a continued interest in the biker lifestyle. I can appreciate the fact that he understands,that aggressive lenders will play a major role in the continued success of Dealerships for the future, but what does it mean to be the #1 Dealer for a manufacturing line that has filed Chapter 11 to Restucture: that he “HELPED?” to develop? Lets be honest, here is a guy that has no problem biting the hand that feeds him. Do us all a favor, sell the product your dealership provides, show some respect to the industry that putting food on the table, and let your actions/business practices speak for themselves.

  4. 4 Raymond Jun 17th, 2008 at 3:40 pm

    Mr. Strand is the most arrogant, self serving, pompous dealer in the Custom Motorcycle industry. He boasts that he is the #1 American Ironhorse dealer in the country but his actions along with the actions of the factory at Sturgis last year did imeasurable damage to the entire Vtwin industry. He constantly boasted that AIH was in great financial shape when in fact they were going down the toilet. Look at his other posts on this blog and you will get a true measure of what kind of man you are dealing with. If the new owner of American Ironhorse was smart he would cut this virus loose before he infects the new company like he infected the old one.

  5. 5 Pirate Jun 17th, 2008 at 6:36 pm

    This guy is absolutely amazing. Could he be the second coming of Christ? Sounds like he believes he is. The truth of the matter is this idiot did whore up the market in Sturgis and Panama City Florida with his garage sale mentality. Selling ’04, ’05 and ’07 NEW AIH Bikes for below factory cost. All with NO WARRANTY so it was a buyer beware situation. I didn’t hear anything from “Superman Strand” as to an explanation as to why American Ironhorse had so many 2004/2005 and 2006 bikes? Hell, if the factory” was smart they should have just called “Superman Strand” to sell off the bikes based in their “Over Production” situation! If that had happened maybe American Ironhorse would have avoided the Bankruptcy Court. As for his incessant whining about the factory providing financing to his “credit challenged” customers – what is this guy thinking? Sure people like HD and Polaris can do inside financing and take a beating with the repos. they experience later. Most companies can not afford that option. Besides since when is a customers credit problems the manufacturers concern? That is a Dealer issue. This person sounds to me like he is doing nothing more than making excuses as to why he has so many AIH bikes on his showroom floor. In my opinion this guy is the failure not the manufacturers. Also, those Icons of the industry he is so jealous of are exactly the Icons that got him in this business in the first place! “Superman Strand” owns a company called “Sun Water Systems” – doesn’t exactly exude a biker sound to me, how bout you?

  6. 6 Dave B. Jun 17th, 2008 at 6:46 pm

    What a load. AIH is 13 minutes into its 15 minutes… tick-tock-tick.

  7. 7 Charles Strand Jun 17th, 2008 at 7:08 pm

    Wouldn’t expect too many of you to understand my point in this article as it is basic business “common sense”… which seems to be very “uncommon” in this industry. You guys should really get your facts in line before shooting off your mouths, you just make yourselves look even dumber than you really are!

    Does it make me a bad guy that I own more than one successful business? Sooner or later, people in this industry will have to lose the big egos and bad attitudes and realize that it’s just business… addition and subtraction!

    Charles Strand

  8. 8 Raymond Jun 17th, 2008 at 7:56 pm

    Mr. strand – It is sad when you have to proclaim to the world how successful you are. With your extremely arrogant attitude nobody gives a shit. I wouldn’t be surprised if the new management of American Ironhorse tells you to take a hike. Selling bikes for a manufacturer is great but at what price when you’re shooting your mouth off everywhere. If I was a manufacturer I certainly would not want you to represent my brand….no matter how many bikes you sold.
    You talk about business – maybe it’s time for you to get off the airwaves and tend to your business. If you are so successful, why don’t you finance your sub prime borrowers inhouse and not lose the sales. Use your gazillions to form your own bank.
    One other point – If you were on the board of AIH from the start, why did they never make any money? Were you on the board when Wil Garland was hired and did you vote to hire him? His presence was probably the most detrimental of any of the CEO’s. If you were a shareholder, why didn’t you hold the board’s feet to the fire after you got off the board? For such a “successful” man you have made some real blunders not the least of which was your belief that AIH was financially stable when they were going down. You may be the #1 dealer but it is like being the Captain of the Titanic.

  9. 9 Dave B. Jun 17th, 2008 at 8:34 pm

    Mr. Strand, I have been in this business almost 20 years, I don’t need you to explain to me how it works. tick-tock-tick

  10. 10 blueskyrider Jun 17th, 2008 at 9:07 pm

    Mr Strand,
    What is your position with AIH now and is it true that you were the backer for Bill Rucker’s bid on AIH?

  11. 11 Sheridan Jun 18th, 2008 at 4:26 am

    Reading this sentence just sent shivers up my spine: “Anyone should be able to read between the lines and realize that the key to survival in this industry, or any similar industry, is sub prime finance, without it there won’t be a Custom Motorcycle Industry much longer.”

    With something like 3 million Americans forecast to lose their homes in 2008 because of the Sub Prime mortgage fiasco, I would have thought the message would be sinking in that this greed and hunger for debt with poor quality finance is what’s sending the US economy down the gurgler along with all industries supplying luxury goods.

    If I were a manufacturer trying to survive in a crashing economy I would be seriously looking at exporting to other countries with economies that are booming. Here in Australia we are going through the biggest boom time in our history, with so many people earning more money than they know what to do with. Of course our economy is feeding off the growth of China and India, so again two other places with more money than they know what to do with.

    Here in Australia Harley Davidson sales are booming with sales contiunuously increasing and dealers barely able to keep up with demand, with long waiting lists on popular models. Victory is about to go on sale here this year after much anticipation. Hellbound Steel were sold in droves here, and currently Pro-One and Saxons are being snapped up before dealers eyes. Sucker Punch Sally bikes are also on sale here now, and being more affordable that the billet large scale production bikes have a lot ot people interested.

    I image there would be a lot of place in Europe where Choppers could be exported successfully too.

  12. 12 Doc Robinson Jun 18th, 2008 at 7:55 am

    Onya Sheridan. Well thought out and well said.
    Any manufacturers, small or large, who want to enter the Aussie marketplace should contact the premier American V-Twin oriented magazine in Australia, Heavy Duty magazine.
    Log on to http://www.heavyduty.com.au and take a close look at what’s happening down under.

  13. 13 Attila Jun 18th, 2008 at 8:50 am

    “Eventually, manufacturers will realize that it’s not about them, it’s not about the bike… it’s about the Dealer… and even more so the Salesperson on the Dealership floor.”

    Epic. This mentality precisely describes how a culture like the Japanese excels at business growth by the consumer (and customer service) being the pinnacle. With this statement alone, Mr. Strand shows us that he knows all to well about the big egos he speaks of.

  14. 14 Charles Strand Jun 18th, 2008 at 10:22 am

    Seems like some of you think these blogs are meant to be a way for people to spread lies using alias names and nick names without any accountability. The idea behind blogs is that they are a way for people to express their opinions openly.

    My “opinion” is that the “factory custom motorcycle industry” cannot survive, or produce the volume of sales they need, without sub-prime finance. If Harley Davidson could only finance A&B credit buyers, there wouldn’t be a HD. If the boat industry didn’t have sources for C&D credit buyers, they wouldn’t exist, nor would the RV industry, most auto manufacturers, etc., etc.

    I agree that U.S. manufacturers in this industry should put some focus outside the U.S. With the USD losing value, it makes American products cheaper around the world. We have been working for the last 9 months to get AIH bikes approved in AU… should happen very soon, but DOTARS is very slow moving.

    BlueskyRider; I have “never” held an employment position with AIH, I wouldn’t back Bill Rucker in anything and didn’t, I was on the AIH Board from 1997-2003, resigned due to strong disagreements with management. Was very against Wil garland and continuously voted as a “minority” shareholder to remove him. Wil Garland wanted to terminate me as a Dealer as well because he thought that “Iconic” status was more important than selling motorctycles… he’s living in Turkey now selling soaps.

    “Mr. Raymond”, my businesses, the ones I control, all make money, which is the point of business. For me to listen to your opinion on business, I’d have to see your financials to make sure I wasn’t listening to bad advise. In business, your report card is your bank account, I’ll match mine with yours and we’ll see who should be taking who’s advice?

    My article was simply intended to get some of the factory custom manufacturers, who are all in financial trouble now, to realize thast they are not imune to the need for good business practices. Customer service, consumer finance, inventory management… are all more important than which bikes is the coolest on any given day… in my “opinion”.

    I have recently purchased a Victory franchise and added it to our Dealership and shifted a lot of our focus to used HDs as the Custom market is so unstable and uncertain. I’d love to see it survive, and think that it will, but wouldn’t bet the farm on it at this point.

    Charles Strand

  15. 15 Roy Jun 18th, 2008 at 10:53 am

    I beleive Mr Strand is right about the custom market. I real good example is K C Creations and Kim Suter.

  16. 16 Chris Callen Jun 18th, 2008 at 11:12 am

    Ok, I’m not going to just bash this cat for is article because as he said, it is business and the main point of his article is right, the motorcycle industry needs new finance practices, but it is a little more involved than that as well.

    From your quote:

    “Eventually, manufacturers will realize that it’s not about them, it’s not about the bike… it’s about the Dealer… and even more so the Salesperson on the Dealership floor. The Dealer who is aggressive and smart enough to know how to market cost effectively and get people into his store and the Salesperson with the ambition, training and the right tools to “close the deal”…that’s where the market potential is, it has little or nothing to do with what brand we are selling. ”

    Having listed the important roles of the transaction in your statement it would seem that you left one out: THE CUSTOMER. This is who it’s really about. The bike is the second most important thing and that has as much to do with serving the customer’s needs than anything else.

    Here’s what I’ve seen in the past ten years. An industry that has become lethargic and slow to react, now unable to keep up with the pace the market is changing. That’s an across the board statement too man, from finance to styling to price point.

    One reason Harley is better coping with this is that they, for some reason, are starting to understand the changes the “New Generation” have brought to the table. They have price point bikes that kick ass as far as styling and they are reaching out in terms of finance. They could still do better as far as comparative price in relationship to other manufacturers but they are on the right track.

    Other manufacturers are on point as well like Sucker Punch Sallys, Flyrite and Brass Balls Bobbers. All of these companies are delivering bikes to customers who are looking for a specific style at a specific price point.

    I think what matters most in today’s market is what the customer wants. That’s what the auto industry follows. They don’t just throw anything on the market and then expect to ram it home with aggressive sales and creative financing, they key on customer demand. You are right however that behind that there must be a strong dealer network, good sales people with proper training, good financing programs, but it all starts with the customer.

    Anyway, just my two cents. By the way, I am the editor of Cycle Source Magazine and can be reached at the e-mail I have provided. Just so there is no mistake about hiding behind a nickname.

  17. 17 VTwingirl Jun 18th, 2008 at 11:57 am

    I agree with you in regards to financing for the dealers.
    We work very hard to sell our bike lines. Incentives help, but having
    in house financing would be a dream for us.
    GE has been great to work with, but they can’t finance most of our customers!
    Loud was wonderful. I miss them. I would love the Victory line, but another dealer has it.
    The state of our economy has customers calling for inexpensive scooters.
    What are your thoughts on Scooters being sold at V-Twin shops, as an alternative to expensive bikes and high gas prices?
    As a former AIH dealer, I want to say, “thank you”, for sharing your business expertise with us!
    Have a great week!
    May anyone who sells V-Twins make good money doing it! It’s not all that easy!

  18. 18 hoyt Jun 18th, 2008 at 12:32 pm

    This has been an interesting dialogue.

    The sub prime comment is still worrisome considering the state of the economy and the state of Americans’ mind in this generation – keeping up with the Jones’ even though you can’t & shouldn’t afford “it” is starting to impact me, you and the neighbors, so knock it off and learn some fiscal responsibility !

    In terms of egos, the salesperson, & the customer:

    Egos – it will be difficult for anyone to refute Mr. Strands’ comments. As-seen-on-TV egos are foolish. You build bikes. Period. Don’t become “hollywood” on us. I applaud the couple of talented builders who didn’t let the “tv” change them (Cole Foster, Roger Goldammer to name 2)

    Salesperson – the industry has a long way to go in this regard. There are loads of dealerships with seriously lame sales people who either don’t know the product or don’t know the customer.

    Customer – Strands did mention the importance of customer service

  19. 19 hoyt Jun 18th, 2008 at 12:58 pm

    another comment about the egos…

    The joe schmo consumer needs to get a grip too. Do you really need an autograph of a bike builder?

    People within the industry who aren’t that visible start to expect some of this “iconic” treatment too.

    If the hordes of people would lose the need for “stardumb” there probably won’t be room for egos. Then, Everyone will get back to the main passion – motorcycles.

  20. 20 Troy Jun 18th, 2008 at 4:00 pm

    I have always run my business with the thought that the customer is the most important part of the equation. Without the customer, we don’t sell bikes or anything else. The customer isn’t always right but most of the time they have to be or you don’t sell anything. You have to pay your bills to your vendors, make your customer happy and have a product that people feel is safe and reliable; then comes the sales people and financing. I see people building “bobbers” with a 93 c.i. S&S engine and a frame that is going to fall apart in a year or less and parts falling off on the test ride. If this is what the riding public wants, then that is what some will give them. This kind of practice may be ok for the short term but the riding public will be on to the next episode before you know it and “cheap” bobbers will be a thing of the past. Baggers are made by H-D and they make real nice ones, it’s hard to imagine that you can make a long term living building custom baggers. When people go to the V-Twin expo next year they will be told by “THEY” , what bike is going to be cool in the coming year. Many builders will fall by the wayside if they get caught up in what is the latest fad. To me, choppers were never a fad, we have been building choppers forever. And Chris is right, you build bikes, and there is not a lot of stardom and autograph signing for most of us. Building a safe and reliable bike however is something completely different. The public can see this, but can’t really afford to buy the really good bikes so they convince themselves that bobbers are better for them because that’s what they can afford. Along with the arrogance of those who build bikes comes the arrogance of those who sell the bikes, manufacture engines for $11,000.00 , and 6 speed transmissons that cost $3000.00, and people in Sturgis who charge $5000.00 to vendors for 200 s.f. of space. The whole thing has gotten out of the builders control and is being controled by those who have the media to control the customer. If I could build a really good reliable chopper to sell to the public for $20,000.00 then I would and the chopper fad would be back on again. Don’t forget, the motorcycle industry is controlled by H-D and if you want to compete with them, then the price has to be within their price range or the average rider will buy a Harley.

  21. 21 Bob B. Jun 18th, 2008 at 4:15 pm

    Mr. Strand,

    Again, I’m just a guy who walked into a motorcycle dealer to buy a bike, now I’m out $30K+ with nothing to show for it.
    America Ironhorse spent the last few years screwing their “A&B teir buyers” and we’re not coming back. AIH never delivered on what is expected/promised when someone spends $30K+ on a bike and their decline in sales over the past 3 years and bankruptcy reflect that.
    The DFW newspaper and the industry press report that vendors, investors and the landlord were screwed in the bankruptcy, but don’t mention the many pending Lemon Law cases that were stayed leaving the customer with a worthless bike. To the new owners I’m a “legacy cost” “Buck” took care of in bankruptcy court. Mr. Meyers startup cost would easily double if the many pending Lemon Law cases still had to be actioned.

    Why would anyone buy an American Ironhorse?
    Maybe you could use my lemon as a door stop at your dealership?


  22. 22 Jeff Nicklus Jun 18th, 2008 at 5:18 pm

    For two days now I have read this crap in utter amazement. I can do longer set by without interjecting my 2 cents worth.

    I 1995 I started Desperado Motorcycles. At that time there were very few “motorcycle manufacturers” on the stage and even fewer Dealers. Other than the obvious HD and some Ricers there was Big Dog, Roger Bourget, CMC, Titan and a company called Illusion Motorcycles (forgive me if I have forgotten someone) and that was it. Therefore with that said I feel I am qualified to react to Mr. Strand’s letter and the many “Bloggers” who have chimed in.

    Mr. Strand, in my opinion, is correct in some aspects of his letter while all the way off base in others. As a Licensed Motorcycle Manufacturer of over 13 years I can tell you that most, not all, but most Dealers are Flakes! That’s right Flakes. Dealers are of the belief that all they should have to do is snap their fingers and we manufacturers with fall on our knees and praise God for the dealer’s mere existence. There is an old saying that says “Those that can do, those that can’t teach.” I have modified that saying to say “Those that can do, those that can’t become Dealer’s”.

    Dealer’s are the first to take credit for the numbers of units delivered during the good times and the first to place blame on the manufacturers for their inability to place units during the bad times.

    Few understand that all we, as manufacturers, can do is to have our products qualified for financing with the various financial institutions. We can not force the financial institutions to lend capital on a prime or sub prime basis to any unworthy customer. HD and Polaris are writing their own paper and then selling the paper, at a discounted rate, to investment groups and banks. Even with that neither of those two companies are writing more C-D paper than they can work into a resale package to the banks.

    Also Mr. Stand states that we, as egocentric manufacturers, are all in imminent danger of financial collapse and we soon go the way of the Dinosaur unless we submit to the Strand School of Business. All I have to say to that is this ….. yes, times are tough in the motorcycles industry right now and yes, we have lost some good companies and friends due to the downturn. We have also weeded out some of the dead under growth and the leaches that are riding the coat tails of the motorcycle revolution. Tough times have a way of weeding out the people who are in an industry and making money in spite of themselves. I am sure all will recall the Dot Com Industry and Real Estate Market slumps of recent. Guess what Mr. Strand, both industries are still here today and much healthier due to the downturn they survived.

    Now to the Ego’s and Icons of the industry ….. If it were not for some of the Icons of this industry such as Arlen Ness, Donnie Smith, Ron Simms, Dave Perewitz and yes, Cyril Huze, few if any of us would be in this business. Personally I have known all these guys for many years now and I am proud to call each of them my friends. I am, however, even more proud to call them ICONS! Further, I am proud to have people ask me for my autograph or ask to have their picture taken with me. Notice I said I was proud not that I was feeding the ego. Least we forget none of us could survive without the interest of the public. Personally I love it when the little kids stand in line for an autograph or poster. Need I remind you that they are the next group to love this sport as much as “most” of us do.? Need I remind you they are the customers of tomorrow?

    I am very proud to say that Desperado Motorcycles was one of the companies at the forefront of the motorcycle revolution. At Desperado we have always capped our production at only 300 motorcycles per year. The reasoning behind that is that by doing so I could control our quality and overhead. We have never spent more that we made and we have never borrowed money from any bank or financial institution to keep the business going. The reason for that is that I knew that nothing lasts forever and every industry has a downturn sooner or later. My parents told me to always save for the rainy day. That rainy day has reared his ugly head in the motorcycle industry and those that have not planned and provided for this day will cease to exist.

    Just a brief note to Mr. Strand: I have never had, to my knowledge, the pleasure of meeting you. After reading your letter I can only hope that your sincerity and humility fail to come across in your written word. I must say that in my opinion it is not the Dealer who is the most important link in the chain as you seem to believe. IT IS THE CUSTOMER BUYING OUR PRODUCTS! They and only they are the people I care about! I wish you well with American Ironhorse, Bourget and now Victory because with your attitude you will need it.

    For those that would like to contact me directly my email address is: j.nicklus@desperadomotorcycles.com

    To all I apologize for my lengthy note.

  23. 23 Paul Jun 18th, 2008 at 8:14 pm

    Mr. Strand – I’m coming in a bit at the end of this blog, but there’s been some very valid comments all the way through. Most notably I think, is that for whatever reason you did omit to place fair value on the most important factor in all this – the customer – but several people in here have already correctly pointed this out. I am not a motorcycle dealer but I have been in business for some years. I am intrigued by a couple of things in your article. Given your involvement with AIH prior to becoming a dealer, surely you would already have been aware of the systemic problems within the organization and the poor dealer support and attitudes you say they have and which you now suffer from? Why then, would you have taken the brand on in your dealership? Secondly, it seems to me that if I were in your position and as dissatisfied with the support from a supplier as you are, good business sense would tell me to drop that product line and replace it with something else that my customers wanted and which I could supply according to MY customer service standards. Credit issues are an issue across all business types right now so surely it’s up to you to adjust your business model to what the market can accept rather than trying to push the same product and price level into a market that clearly can’t sustain it by means of lower credit standards? That’s exactly what the housing industry did and therein is the root cause of the current economic climate.
    Smart businesses will survive this cyclic downturn, but only if they have strong customer relationships rather than simply aggressive sales practices.

  24. 24 hoyt Jun 18th, 2008 at 8:21 pm

    Sure there are builders who sign autographs and haven’t lost touch with reality. Speaking in general terms always creates strong reactions from both sides. The commentary from Charles and Jeff have valid points.

    Signing autgraphs is just an example of bigger, underlying indicators of what a pop culture-like interest can do to an industry. Industries in free-markets that experience rapid growth, attract more of the wrong people (with the wrong short-term goals) than innovative people positioned for the long haul. There are serious consequences and, unfortunately, good people do fall victim even if they are focused on the customer, innovative, & fiscally responsible.

    My 2nd comment above was a sociological jab at the masses and not about ignoring the future generation of customers. We, the masses of people, are part to blame if we lose our own common sense.

    The brewpub industry is another example of pop culture-like spikes. That industry has rebounded with better beer now than the early years, but not before some hard lessons….

    “Bitter Beer Face” advertisements were not completely contrived by the larger breweries. Too many bad micro-breweries popped up everywhere, serving bad/green beer, which resulted in those ads. The bad microbreweries returned, what was an advantage, back to the Large breweries. The masses lost interest, good and bad pubs closed.

    Those ads were a strong indication that the brewpub industry had peaked and was already on its downturn. Their downturn was due to the novice masses not knowing better and the wrong people getting into the business.

    The US luxury cycle industry is also contending with energy costs & a poor local economy in addition to the saturation affects. The survivors will be much stronger

  25. 25 Shane Jun 18th, 2008 at 9:32 pm

    blah,blah,blah, hoyt why don’t you open another 6 pack and find some other blog to blah,blah,blah

  26. 26 Paul Jun 19th, 2008 at 4:08 am

    Cyril, I wish you always publish such “hot” letters here – it was a great discussion! Thank you very much indeed.

  27. 27 You don't know Jack Jun 19th, 2008 at 10:10 am

    As a member of the motorcycle media as well as an employee of GE Aircraft Engines I would like to add that if you produce a proven quality product with the customer being #1, and provide unquestionable service it don’t mean jack sh#t in the long run what shape the economy is in. And as far as financing goes, as long as you don’t have the credit rating of a crack addict, there are any number of loan sharks (banks, finance companies) to put you farther in dept. Hey, you can’t take it with you….Ride hard and keep it up.

  28. 28 burnout Jun 19th, 2008 at 11:09 am

    There is no love in business. I have to make decisions based on solid business experience instead of my, or my customer”s, “feelings”. It is tough to keep a decent profit margin AND happy customers at the same time, Many of the above comments are spot on. My opinion is that too many “Custom Manufacturers” simply over built. To keep a custom bike line truly unique, don’t have 100 red choppers sitting side by side! Just my opinion. My buddy Fat Baby says ” See ya in Sturgis. I’ll be on the black harley” peace

  29. 29 hoyt Jun 19th, 2008 at 1:22 pm

    Shane – you take a free medium to speak your mind and you end up with that lame contribution?

    No doubt there are parallels with the micro brewery industry as Jeff Nicklus pointed out with the DOT COM and Real Estate industries.

    how many autographs do you have ?

  30. 30 Steve Bohn Jun 19th, 2008 at 1:58 pm

    What so many manufacturers out there forget is the passion for motorcycles that we as riders experience. It goes even farther than holding the customer as number one. Manufacturers and dealers need to understand why we ride, and not just look at us as a potential profit source. I’m sure Mr. Strand has examined the riding habits of his customers and has facts and figures documenting how many miles a year owners of “production customs” actually put on their bikes. The number of miles, or the lack of miles ridden would surprise many people. So many of the bikes sold to this segment over the past 10-15 years, are the result of mid-life crisis’, far too many bad television shows, and more than anything else the huge run up in real estate values. With this seemingly never-ending supply of money dried up, lots of perspective buyers have opted out of the market; maybe they were never really in it to begin with?

    As long as there is a buck to be made in any industry, there will be companies and individuals trying to ply their wares in an effort to make a profit. What many of these entities forget is that we don’t have to ride motorcycles, we choose to do so as a lifestyle choice. Chris Callen in a previous post mentioned all of the great companies producing affordable bikes that people actually are looking to buy. The reason people want to buy them is that the people who run these companies have been around motorcycles most of their lives and realize how fortunate they are to be in an industry they love. They ride on a regular basis and more importantly “They Get It.” If you “Don’t Get It” maybe you need to take a closer look at what you are doing and why.

  31. 31 Shane Jun 19th, 2008 at 2:08 pm

    autographs on checks is all the autograph I care about. Mr Strand is talking about motorcycles here…not brewers and beer. I’ll buy you case if you will blah,blah, blah some where else about beer.

  32. 32 hoyt Jun 19th, 2008 at 4:46 pm

    Shane – right, we are talking about the motorcycle business and manufacturing/dealer business practices in general.

    I’ll admit I elaborated on the similarities of the brewpub rise/decline/rise trend, but it is not as though I went on for “blah, blah” pages (2.1 paragraphs). Open forums are served well when analogous topics are presented, especially ones that the given “audience” can relate to … most people here can relate to beer.

    You’re fooling yourself if you think someone’s going to listen to you when you speak to them like you did.

    Rodenbach Grand Cru – the large bottles. Bring your checkbook.

  33. 33 Clark Jun 19th, 2008 at 6:01 pm

    Lots and Lots of words tend to frustrate poor readers! Maybe an outline version would help our
    frustrated comrads…. Oh yah, production bikes are a cop-out anyway. when someone buys a
    production “custom” it screems, I JUST WANNA LOOK COOL NOW! Instead of having the patience
    to build there own “the balls”, or taking the time to find a good local builder to build them one.
    It does not cost over $20,000 to build a re-liable v-twin. Less than $12,000 with all new parts easy.
    Even expensive parts brake. With a little homework and patience it can be done. Many of the parts
    on a cool custom can be found anyway. There are tons of companies manufacturing parts that parallel motorcycles. The bikes built by AIH and the likes are so ugly and uncreative, I don’t understand why anyone would want to spend so much money anyway.
    Support your local shops and in the process our ICONs !!
    Build your own machine shop and custom ride for less than a billet barge!!
    Sure is hot this summer……………

  34. 34 Bo Bo Jun 19th, 2008 at 7:34 pm

    Say Clark,
    Your opinon wont hold water. Did you know that opinons are like assholes? We all have one. The AIH bikes are probabl far more better looking than anything you ride, if you ride at all.

  35. 35 Nicker Jun 19th, 2008 at 7:59 pm

    Well, Burnout said it so i don’t have to
    “…To keep a custom bike line truly unique, don’t have 100 red choppers sitting side by side! …”
    “… many “Custom Manufacturers” simply over built….”

    Is “Custom Manufacturing” an oxymoron…….???
    (If your “manufacturing,” by definition you are not “customizing”)
    Look at the difference in the price of an art original and the litho-copies.

    The market (regardless of the condition of the economy) responds fairly predictably to supply and demand. No surprise there.

    Regarding dealerships, this may be more anecdotal than statistical, but….
    Spent a half day last week sitting out a snow & sleet storm in the Missoula HD dealership.
    (Also selling high end Ducatis). They had 2 Buells on the floor and 6 or more Ducaties.

    New high end building, very nice polite, helpful people.
    One of the group needed a side stand spring replaced. They quoted him $100.
    The place was empty, the service bay was empty and some one let it slip that they about to lay off people.

    The next day one of the Classics let go a cam chain tensioner. We pulled into a smaller HD (and Vespa scooter) dealership some place in Idaho. It was packed. Since we were on the road, they put us at the head of the line and had us back on the road before closing time. Great service, good price. The place was full of people the entire time we were there.

    Draw your-own conclusions.


  36. 36 hoyt Jun 20th, 2008 at 12:43 am

    I agree with a lot of what Clark said. If you’re going to go custom, there’s a lot to be said in finding a good local builder for a fair price. Support your local builder and for Shane…support your local brewer, too 🙂

    A crate motor for a hot rod car costs the same or less than some of the v-twin motorcycle motors?

  37. 37 Pirate Jun 20th, 2008 at 12:16 pm

    The problem in having either the back yard builder or the guy down the street who has a bike shop build a bike for you is that they are impossible to get titled, insured and financed. Also where do you go when something goes wrong?

    Clark – I worked for one of the larger “Custom Production” companies a few years ago. I was a senior member in the purchasing department of this company and I can assure you it is not possible to build a new motorcycle using all new parts for under $12,000.00. NO WAY. That cost does not include overhead, insurance or labor either. Neither do the materials cost 20K.. Joe Blow on the street buying all new materials at retail prices couldn’t build a bike comparable to a Big Dog, Ironhorse or Desperado for under 25K.

  38. 38 JT Jun 20th, 2008 at 1:09 pm

    Clark can build a bike for cheap because he has no overhead, he’s a “Shed Builder”. He builds junk! Check out his website & you’ll see that he’s a “wanna be” bike builder. Clark looks at to many magazines & dreams of being Billy Lane. Hey Clark, leave the building to the professional builders & production custom builders like Big Dog, AIH, Big Bear etc.

  39. 39 Rider Jun 20th, 2008 at 1:16 pm

    I had a great experience with the quality, performance and looks of AIH.
    Very few problems. Our customers have loved their bikes and rode despite
    AIH management falling apart. We did not like the fire sell in Sturgis with the
    select dealers making more than us and selling way cheap. My customers that went
    to Sturgis and paid higher with me felt screwed and so did I. I had customers wanting
    me to match the deals. Impossible. We cancelled our dealer agreement after Sturgis.
    AIH did take their bikes back for me. Sad part is we loved the bikes, but not the favoritism shown to
    the select dealers. Maybe the select dealers will be the ones having to selling and servicing the revived AIH line. Best wishes to the new AIH. Thanks for attempting to salvage this company, for those who need it. Trust is earned and I don’t see myself signing a new dealer aggreement with AIH.

  40. 40 J Jun 20th, 2008 at 4:55 pm

    “In the 5 years that I’ve been on the retail side of this very unsophisticated industry,…”

    LOL– way to invalidate your credibility AND insult your audience, all in your very first sentence!

    Sorry- I didn’t bother to read much beyond that gem, but a little tip? Sub-prime financing- or any sort of financing- is easier to find when credit facilities are dealing with known risks, such as Harley and Polaris- companies with either 100+ yrs of product history, or a widely diversified product line.

    I can’t imagine the response when Iron Horse is asked to lay out 2,5 & 10 yr market share forecasts and resale depreciation tables for prospective credit facilities; You just can’t generate any meaningful numbers, so don’t even bother to try to compare yourself to Harley and Polaris, let alone GM. A 2008 Hummer, for example, was substantially improved over the 2007 model, hence the large discounts on the 2007’s; Can Iron Horse make that same claim?

    As the saying goes, “follow the money”. Had sloppy subprime credit never existed, Iron Horse never would have grown to the size it is now- that’s reality. No one is going to infuse capital into your business model soley on the basis of “well, that’s how it used to be during the boom”;

    B of A isn’t talking about YOUR bikes when they mention “american built bikes”, they are talking about Harley and Polaris- entities that absorb financial risk by selling their OWN paper to facilitate credit financing. These are very sophisticated business relationships, actually;

    Where is Iron Horse paper? What symbiotic relationships does Iron Horse have with any investment banker? This is the reality of sub-prime financing, and if Iron Horse can’t play in that arena, they should have NO expectation of access to sub-prime financing in the future;


    You can personalize it all you wish, but the reality of the situation is this: Too many Iron Horse bikes, too many Iron Horse dealers, and no matter how you try to “market” the mix, too few qualified buyers, ergo demand. Just like every boom/bust cycle since the beginning of time, things will rebound when there is blood in the streets, and good people go out of business and lose everything- sad, but true.

    BTW, I see that you do more than sell motorcycles- so good point, you’ll be in business for a long time, but probably just not the Iron Horse business….. Good luck to you in all your ventures, Sir.

    -Disclaimer- I worked as an investment banker in a previous life……..

  41. 41 Conrad Nicklus Jun 21st, 2008 at 12:10 am

    Im going to chime in and add to this aswell. Throughout the 14 years of following this industry I have noticed several things. One of the main things I have noticed is the lack of love for the sport of riding from most builders. They come in for the quick buck and the second they see the dollar fading they jet like a cat running from a dog. As for the dealers they are here one year and gone the next. I can count on 2 hands how many dealers have stayed true the entire time and have done nothing but helped us with our needs, not with their needs and not snapping their fingers screaming get me this get me that. The true dealers dont say to themselves “let me add a 10k markup on this bike yet the customer can go 50 miles away and get it for 3k over M.S.R.P.”. This is something that Mr. Charles Strand does not understand nor will he ever. He is NOT one of the “FOUNDERS” of AIH aswell. I personally know the TRUE founders of AIH and their names are Bill Rucker and Tim Edmondson, NO WHERE IN HERE did I mention Charles Strand.

    So the selfworth that Mr. Strand shows is nothing more than a lame excuse to put his name on this blog and feel like his worth is so much more.

    I do not mean to rant and rave on Mr. Cyrils blogs but I feel my point must be shown to all who read, I can tell my dad holds some emotions back on this subject which I will not do. I have been told by my father to keep it in as much as I can but sometimes, when it comes to such ignorant posts and comments, I must take the time away from my studies and voice my thoughts. Sorry Dad.

    I have been with this industry for a long time and am happy to say I will stay with it for a long time. Through all the downfalls and the uprises in sales I will stay. I love riding and I love designing and building, hell I even love the pictures and questions people ask about the bikes my dad (Desperado employees included) and myself build. On the other hand I do not like the over indulged ego maniacs that are in this industry today and I will watch them leave as I make my presence known through Desperado and HOPEFULLY Jeff Nicklus Customs.

    I love reading through this and reading my fathers comments as well as others comments. I live 300 miles from home so my only contacts with my dad are usually email (your typical hilarious emails and business related stories) telephone, this blog, and the occasional visit home (like stated occasional, once every few months).


  42. 42 Conrad Nicklus Jun 21st, 2008 at 12:26 am

    Ok and something just really upset me…

    “I oversaw a “Prior Year Model Close-Out Sale” at the Sturgis Rally where we sold over 100 motorcycles in 8 days. I’ve heard remarks from some of our “Industry Icons”, “Industry Idiots” would be more accurate, as to how we “prostituted the market” by selling new 2005 & 2006 models at $6000 to $8,000 off normal MSRP when 2008s were being released. This demonstrates the ignorance that dominates our industry. During the same time frame, you could buy a new 2007 Hummer (1 year prior model), Corvette or Cadillac for $10,000 to $12,000 off MSRP, 2006s at $15,000 Off! It is the common practice of smart Dealers and Manufacturers to clear out old inventory at discounts. We were selling bikes that were 2-3 year prior models at discounts less than car, boat and RV Dealers were selling 1 year prior models for. Only an imbecile would call this bad business!”

    Ok, SOOOO, Mr Strand, now that you whored your services at Sturgis last year, Let me tell you about something people have been saying about you and the otherdealers. I heard nothing but “wows” about how “cheap” you can buy a 2004.05.06.07 AIH for down by Main Street. Many questions were” why are these so cheap”, “what do we get with this cheap price” (answer is basically a LOT of problems and disappointment) and best of all “Would you buy a Texas Chopper”fully loaded” for $_______?” my answer was always “HELL NO”. AND as far as dealers there with you Mr. Strand selling their bikes as well. That is way different than a dealer having a big sale. Dealers dont get together all at once and liquidate models that are old liek that. SORRY.

    “”“Industry Icons”, “Industry Idiots” “”

    Sir, you are an INDUSTRY IDIOT. Im 21 and have been here since way befor eyou and I can tell you that YOURE THE IDIOT Sir

    “The industry suffered a “popularity overdose”. Good business practices were thrown out the window. Almost everyone involved in this industry over borrowed, over leveraged, over estimated and under achieved. Now the entire industry is poised for one giant enema, a cleansing long overdue!”

    I thank you sir for using ALMOST in this comment. My father has not recieved a single loan while in this industry. He believes that expansion is paid for by sales not by loans. I cannot tell you how many people do not understand this. We are a debt free company unlike YOU or anyone around you. We are privately owned and will always be. The cleansing, if you are not careful with your business practices and remarks, will include you sir.

    “I don’t expect too many manufacturers or Icons in this industry to agree with this reality, but it won’t matter as most of you will likely not be around much longer anyway… I will!” Charles Strand”

    Sir, you will not be around much longer. You are talking smack about the ICONS that keep YOU in business. Watch the way you speak about them for this can bite you in the A$$ and send you to the gutter. My father is an ICON, Arlen Ness (Uncle Arlen as I call him) is an ICON, Mr. Cyril Huze is an ICON, Roger Bourget is an ICON. You sir are a nobody.

    DO NOT DOWNTALK THE HAND THAT FEEDS YOU. Learn something about business.


  43. 43 Chris Callen - Source Editor Jun 21st, 2008 at 9:02 am

    Ok, last thing I’m gonna’ say on this, and only posting now for fun.

    I love the part where Nicker said

    “Look at the difference in the price of an art original and the litho-copies.”

    That’s almost a perfect definition of the deal here but I think what AIH would have you believe is that they offer Giclee Reproductions, a much higher quality re pop than a litho, but not quite an original.

    Anyway, the real reason I am posting now is to comment on Pirate’s last statement.

    “The problem in having either the back yard builder or the guy down the street who has a bike shop build a bike for you is that they are impossible to get titled, insured and financed. Also where do you go when something goes wrong?”

    It seems to me you do what we have always done in this case as motorcycle people, you go back to that cat, if he will not help you call the manufacturer and if that doesn’t work you grab your service book and fix the thing your damn self.

    I hate the fact that self reliance has almost completely been removed from this culture. I grew up riding with cats that knew a hundred and ten ways to fix a Harley with bailing wire, soda pop cans and super glue. What happened that gave us this “What if something goes wrong” fear. Something always goes wrong man, it’s how you adapt and overcome that gets it done right?

    Ok, on deadline and even know I’d love to keep writing, I have to split. Thanks Cyril for such a creative environment for conversationalists!

  44. 44 burnout Jun 21st, 2008 at 9:59 am

    I LOVE this blog!!!! I LOVE to ride!!! More fun than being a rodeo clown! peace

  45. 45 Charles Strand Jun 21st, 2008 at 11:47 am

    Conrad Nicklus,

    You missed the point. The “Sale” in Sturgis last year was NOT “my” sale. AIH asked me and 5 other Dealers to help them sell off 100 “2005/2006” bikes (no 2004s) that had to be sold or they would be out of business. We did… none of the bikes belonged to me.

    I have communicated with your Dad, had many good conversations with Arlen Ness and Roger Bourget… I have nothing but respect for all of these guys and was not directing my Idiot/Icon comment to them, I appolagize if it seemed like that. The comment was primarely directed towards Mr. Fairless who made such a point of misinforming everyone that “I” put on the Sturgis Clearance sale last year. And, it wasn’t whoring out anything… it was selling 2-3 year old inventory at whatever the market would pay… normal business!

    I’ve been in the MC business for 11 years, 6 on the manufacturer side and 5 as a “Top Dealer”… guess that means you got into the business at 10 years old?

    I’m doing OK in this business and have no plans of going anywhere… the market your Dad is in, Arlen is in, Roger Bourget is in is a lot different that the “Factory Custom” program AIH and Big Dog were in persuit of…. 3000-5000 bikes a year was the target for each. My comments were that for anyone to reach those levels, sub-prome consumer financing woiuld be needed.

    Signing off for good as there is too much bad attitude and too little common sense going around here.

    I will not be commenting anymore on this blog, so go ahead and take all the cheap shots you’d like. If you want to talk as a real person, Charles@IHOT.us, is where I’ll be.

    Charles Strand, Iron Horse Of Texas

  46. 46 Pirate Jun 21st, 2008 at 1:16 pm

    Chris, Right you are. Unfortunately way too many of todays riders do not know the differance between a phillips head screwdriver and a hammer let alone knowing where where to start in an owners manual.

    Mr. Strand, FYI: It is my understanding that Conrad Nicklus started “helping” in the shop at Desperado at 8 years old. I first met Conrad at Bike Week when he was 10 years old and on Spring Break from Grade School. Just thought you would like to know that.

  47. 47 clark wagaman Jun 21st, 2008 at 9:58 pm

    Thanks for the response. I am a shed builder and never claim to be otherwise. I guess the definition of junk is an opinion. The bikes I have built are still running strong today. Any bike that’s ridden quite a bit is going to have some necessary ongoing maintainence. I haven’t had any trouble registering or insuring my bikes. Once again , it takes a little more homework to get it done. You can’t just call AAA and have paper by tomorrow. Hat’s Off to anyone making a living in the v-twin industry. I probably wouldn’t want to try. I just like to get in on some of these responses. Thanks Clark

  48. 48 Nicker Jun 22nd, 2008 at 5:27 pm

    Per Charles’ request i responded to him off line with CC to Cyril (who wanted to know why it wasn’t posted).

    My basic response to Charles went as follows:

    It’s only fair to preface these remarks by admitting they are a perspective from an earlier era and so may no be particularly relevant to many. As i told Charles i go back to the days when Bob Monroe was Arlen’s “manufacturing process.”

    I did confess to being totally amazed at what people like Arlen (and i presume he) have been able to do with this “cusdom industry.”

    Growing out of an area where each scooter was unique and the trademark of the owner’s talent, artistic expression and skill, to today’s “productization” of “custom bikes”, it’s taken one Hell of a leap forward.

    So, the emergence of an industry to service what was historically, at best
    a niche parts market, is especially surprising………. to me anyway.

    In an earlier time (in this neck of the woods), anyone who would sell his scooter was looked upon as something of a “traitor.” Your skill as a technician was the price of admission to “custom bikerdom.” Getting help was acceptable, but everyone know how much of “you” actually went into your project. And your “street-cred” was established accordingly.

    Here’s the reality check: what does anyone who bought his bike have to contribute to a bench-racing session…. (“ya man, i really had trouble writing that check”)?

    I realize that up to this point “the industry” has had a great run. But i believe that this market has been an anomaly based on the convergence of a certain baby-boomer demographics, media images (many galmorizing) of the 60’s gang culture, and some B-grade Hollywood flicks.

    I’m certainly not disparaging Charles’ commercial achievements, by any means.
    From a business perspective he has my admiration. I simply believe that this “mass-chopper-market” has been a bubble waiting to burst, sub-prime loans or not.

    A business model like that of the Art Auctioneers might provide another path forward.
    TV coverage of a “true Custom” build (not a bling-assembly), where a retail customer could buy a serial-numbered, limited edition “copy,” might give the top end custom market some legs. But beyond that, i simply don’t see the current business model as being any more than marginally viable.

    Lets tell face it, “manufactured customs” is a diminishing market. There are only so many people who will try to “buy their way into being somebody” (certainly not at these prices)! Moreover, the boomer demographic is rapidly running out of money, time and energy. Florida is tired of tawdry behavior. The older ya get the worse ya look in a thong. And the young kids couldn’t give a rosy rat’s ass about Easy Rider.

    Yes, there will always be a bikers. We’re like fungus in the bathroom, dammed impossible to get rid of. But that 1% will simply not sustain this house of cards. And $7+ a gallon gas will sell a bunch of MX-bike-riding kids $8k street trackers, when they become drivers.

    The dynamics and makeup of this Industry isn’t a new issue and you-all have touched on it:
    re: -Pirate-
    “… Unfortunately way too many of today’s riders do not know the difference between a phillips head screwdriver …”

    When the EPA and the Green movement get through with us we’re gonna need more than a screw driver and a hammer.

    RE: -Hoyt-
    “… If you’re going to go custom, there’s a lot to be said in finding a good local builder for a
    Well, yes, if it’s more than a simple assembly of OTS parts.

    RE: -Charles-
    “…Signing off for good as there is too much bad attitude and too little common sense going around here…”

    Excause me?… “…too much attitude…” exactly how long have you been involved with Bikers?

    RE: -Chris c.-
    “…I hate the fact that self reliance has almost completely been removed from this culture.
    I grew up riding with cats that knew a hundred and ten ways to fix a Harley with bailing wire…”

    Spot-on Chris…! “self reliance” is what being a Biker was once all about.
    So why do some (in this blog even) see no contradiction in “being a biker” and also suggesting the
    “national guard should supervise bike events.”

    From a broader perspective, isn’t that what freedom is (was?) all about.
    It shure as hell ain’t about nationalized health care, or the nanny-state making “bikers” feel safe at
    Datona Beach.


  49. 49 Jim Jun 23rd, 2008 at 12:57 pm

    Wish I would have seen this earlier. Although Mr. Strand is not too far off with the general idea that the custom bike manufacturers are their own worst enemies and have destroyed what could have been a great market, There is NO question in my mind that Charles Strand is the biggest EGO and without any doubt self serving IDIOT to ever grace this industry.

  50. 50 psychodrew Jun 23rd, 2008 at 3:42 pm

    Keep them simply

  51. 51 Biker Bob Jun 23rd, 2008 at 3:46 pm

    I wonder if any one besides me has read this comment section from the top to the bottom? Wow, what a soap opera we got goin here, one guy feeding off the others comments and the argument escalating from there.

    Your mothers would be ashamed of you, just simmer down now. I say let’s all be friends and go down to the local titty bar, get a good buzz on and watch our favorite stripper jiggle and wiggle her way into our hearts. Some of you more up tight dudes may need a session or two in the VIP room.

    Iam not saying this will work for everyone but Iam willing to bet it would do more good than commenting on old wind bags opinion, cause let’s face it, nobody gives two shits what the other guy thinks anyway. Only a stripper and enough alchohol can make you think what you have to say is important. Now,…. am I right or am I right????

    See ya at the Strip Club


  52. 52 David Jun 24th, 2008 at 12:42 am

    Well the only thing I have to say is I wouldn’t finance anything through GE! When they are doing so much and in bed with Iran. Who cares if I cant get a new custom motorcycle.I’ll work and save like it should be done and pay cash for what ever is out there that my money will Buy. This country is going to HELL in a Handbag if we don’t wake up and smell the Roses. It’s all about “ME” and what “I” want and not what I can or cannot afford.I have learned this through out my life and was taught well growing up.I still think it really sucks that you can’t finance a house like a car it’s a more stable and growing asset but why 30 years to pay for it. Maybe I could get them to finance a new Custom bike for 30 yrs. Grow up people it’s just another luxury we dont really need.Ride used and paid for!!!!!

  53. 53 Big D Jun 24th, 2008 at 1:45 am

    Wow, wish I had read this a few days ago.

    I’m just a guy who rides, but I wish Charles was still responding. WHAT EXACTLY IS THE POINT OF THE LETTER? He mainly seems to be lashing out at manufacturers and “industry icons”. Is the point of this to assign blame? I wonder if he is getting a daily dose of mad customers complaining about AIH and he needs someone to vent at, complain about, etc. I admit, I don’t know why he is doing it, but oh well.

    Ok, let me get on with this.

    One of the first statements I read in his letter….
    “In the 5 years that I’ve been on the retail side of this very unsophisticated industry, I’ve seen an evolution that any good business person could have predicted many years ago.” So let me get this straight. He is a good business person, therefore he must have seen this coming years ago, yet, he still opened up a AIH dealership, & sold 250-300 bikes a year to customers even though he, a good businessman, knew that troubles were in the future. That is the short sided attitude that I would assign blame to for the industry woes. I certainly wouldn’t assign all the blame to any one man, but it appears to me as if this is the short sided, do for me now, make a profit, and run attitude that did hurt the industry. I don’t fault Charles for his attitude, hell, go out and make your dollars. Just don’t try and make it like it is the other guy, the industry icon, or manufacturers fault. Take your fair share, no more, no less, of the blame and shut up about it.

    In regards to the Sturgis situation, Charles is trying to compare selling off bikes at deeply discounted rates to GM clearing it’s inventory. Hey I wasn’t there, but using his statements of what happened if I was a AIH dealer, I’d be pissed too. Yes auto manufacturers offer specials to clear their inventory, but they offer incentives through ALLof it’s dealers to do so. They don’t go to the Detroit auto show and start selling off previous years inventory directly to the end consumer at or below what their dealers had to buy them at. No, they put together dealer incentives and programs that are offered to ALL OF their dealers to try and move their product. Again, I’m not a dealer, but I guarentee that if I was a dealer, and the manufacture set up shop at some place and undercut me, hell yea I’d be a little pissed too. JFC, what kind of manufacturer would do that to it’s dealers? Oh don’t answer, I can answer that myself. A manufacturer that probably saw that in the next few months it would need to declare bankruptcy……

    In regards to financing C&D credit scores, maybe, just maybe, Loud Financial and the other lenders understand that lending to C&D credit scores so they can purchase $30K plus bikes might not be the most sound financial decision. When AIH started, I seem to remember that most of the bikes they sold were $25K to $30K. Pricey, but given the state of the price of Harleys, not that far of a reach. Sure you could buy a Harley for a little less, but by the time you did nothing more than put on bolt ons, you were going to run the price of a HD near what you could get a good looking, semi-custom, bike. I think in the last few years, AIH lost site of that. Their bikes jumped in price to levels that didn’t make them competitive. AIH didn’t have a bike under $30k. Hell if I had over $30K to spend on a custom bike, I’d get a custom not a manufactured custom. I’m not sure what the resale value of an AIH is, but I am guessing not too good. So it seems to me, before you can get legitmate financing sources to fianance to C&D bikes, you are going to have to manufacture bikes that maintain their value better, and also are less expensive. Let the A&B customers buy the $30K plus bikes. I’m not sure if Charles would agree, disagree, or simply modify this thought, but my point is I don’t think you can simply blame the manufacturer for not finding sources for C&D financing for the industry woes. There is more to it than that.

    Finally, the blasts against the “industry Icons”. Total shame on you Charles. Again, it seems like you are simply trying to blame others for the state of the industry and I’m wondering what the motives are for this. Jealousy? Sour Grapes? Based on his 36 mile reference, and a subsequent post, one of those “industry icons” he is lashing out at is Rick Fairless. If Rick is mad about the Sturgis deal, well like I said, I’d be mad too. I think he has a legitmate reason to feel that way. And your remark about Rick believing himself to be an industry icon is out of place. Rick works hard and why shouldn’t he benefit from the fruits of his labors? But the thing that gets me is that I’ve never seen Rick cry out it is all about him. Rick will host a major party and you’ll see all sorts of vendors at his place. Many of them selling prodcuts or services that compete with his products or services. But Rick allows them there. WHY? But because Rick understands that it is not all about him. Rick now has a radio show. Listen to his radio show. Almost every week he has on motorcycle industry people, some of whom sell the same products and services that Rick sells. But still he lets them come on his show, talk about what they are doing, give out their websites, the locations of the next rallies they will be at etc. WHY? Again, because Rick understands that the state of the industry is the most important thing. That if the industry survives, he’ll get his fair share of the business. Others will get will get theirs fair share too, but he’ll be happy working hard and earning what he gets. I think by lashing out at the “Industry Icons” Charles is showing his true colors…..

  54. 54 Charles Strand Jun 24th, 2008 at 2:02 pm

    Big D;

    Don’t agree with what you said, but at least you said it in a civilized manner.

    The point of my letter, was to try and wake some of the “high volume” “factory custom” manufacturers up. I’ve been on both sides and heard Dealers bitch about manufacturers and Manufacturers bitch about dealers for the last 11 years. A lot more bitching going on now that most are making less money. We are doing better than ever, mainly due to getting better finance sources for our customers.

    For companies like AIH, Big Dog, Saxon and a few others that went after the “factory custom” market with business plans that called for 2000-3000 bike sales a year to be profitable, sub-prime financing is a must. Ask any boat dealer, RV dealer… or even a Harley dealer! It’s not the same market as a Cyril Huze, Ness, Desporado, etc… that mostly make one-off customs and cater to a very elite and specialized customer.

    Rick Fairless is primarily in the bar business, that’s where he makes his money. To comapre him with what we do is a joke. We are a “reatil motorcycle dealer”, not a builder. We don’t care what brand we sell, how famous the manufacturewr is or what anyone thinks about us other than our customers. I kept providing warranty work for all of my AIH customers, and Rick’s as he stopped when the factory stopped paying its bills, for nine months without pay, out of my own pocket. Don’t really blame Rick, but no one can say he takes care of his customers like we do/did.

    Rick sold 16 AIH motorcycles in the Dallas market last year, we sold 121 out of our store, 151 counting Sturgis sales, and we are in a territory with 1/3 the population and 1/5 the money.

    If you were AIH, who would you pick for a Dealer?

    The “point” of my letter was simply to stress the importance of non-prime financing. Anyone that deosn’t understand it, must be in a different business or market. 60% of our sales are to people with C&D credit. FYI; C Credit is considered a 640-680 score with most lenders… the average American consumer is below a 680 score, but most often still a good customer!

    At least this thread got a lot of attention and opinions expressed… 55 comments in 1 week. More than any other “headline” on this blog. Can’t argue that it’s not a worthy point of discussion.


  55. 55 Real Ironhorse Numberone Jun 24th, 2008 at 8:34 pm

    First, I would like to ask that Mr Strand stop with the “I’m the numba one dealer” thing. It’s getting old, and it’s false………….he’s number two.

    I have been the number one dealer of American IronHorse Motorcycles for 5 years running. I deal at least one, sometimes two, every single day. That’s at least 365 a year. Hell, I dealt one about an hour ago. And since I’ve had mexican for lunch for the past three days, I can tell you it was a rare beauty.
    I believe in quality so I always eat plenty of fiber. Sure it makes it more of a struggle when dealing, but it will be solid and not just break apart when you flush.

    As for the rest of the comments made here by Strand. Buying down interest rates for people who can’t afford a bike is just one of a million things that Ironhorse actually did wrong. The actual effect wasn’t near enough to offset the cost of servicing the debt that Ironhorse incurred doing it. It also didn’t help the actual buyer, who wanted the loan he couldn’t afford, since inflation has continued to erode his already thin buffer between liquidity and financial ruin. As you can see on eBay and elsewhere many of these bad loans have since gone south, flooding the market with low mileage bikes for a fraction of the MSRP, further harming the market as a whole.
    I was thinking of addressing all of the points, but that would be pointless. Strand just needs to stop smoking and coking it up before he logs onto the internet.

    and once again,

    I’m number one.

  56. 56 burnout Jun 25th, 2008 at 1:19 am

    Mr Huze, you knew this would happen didn’t you. peace

  57. 57 rock Jun 25th, 2008 at 6:12 am

    I agree the dealer network of custom manufacturers(oxymoron?) is a problem. I’ve walked into a local dealership to check out bikes and had to walk past the lawnmower floor display to get to one or two bikes on the floor in the back. WTF? Or the rat cycle shop with a couple monkeys trying to sell bikes that cost more than most folks cars.

    Let’s give HD credit too for putting out products that make it increasingly difficult for a consumer to justify spending an extra $10K to $20K for a factory custom. HD now has 6spd’s, fat tires, big motors, reliability and quality chrome. I’m sure HD put some thought into their marketing strategy and I suspect they have a few more ideas up their sleeves.

    And the factory customs all started to look the same. So they won’t sell on “one offness” alone and they stepped all over each other in competing. HD has a weakness that factory customs can exploit but none of the companies have jumped on it yet.

  58. 58 Raymond Jun 25th, 2008 at 12:33 pm

    I can assure you having worked with the man that Cahrles Strand acts like a complete asshole to his staff, his competitors, and at times to management (even though he was a part of that problem). All of the Ironhorse dealers got his email today proclaiming once again how smart he thinks he is and how stupid the other 220 million people in the US are. Putting him on the Dealer Advisory Council is the first gigantic misstep that AIH’s new management has made. He will alienate the dealers by his crude and rude behavior. It may be the only motorcycle manufacturer with an acvisory council of one.
    It is time for this guy to shut up and run his business. We are all extremely tired of hearing his rantings. Go AWAY.

  59. 59 Charles Strand Jun 25th, 2008 at 1:11 pm


    It’s so easy for someone like you to throw rocks from behind the “blog curtain”. Not sure who you are and don’t care, but I doubt that you have ever “worked with” me. I was never part of AIH management, I was an investor and Board Member, neither are considered “management”… management gets paid!

    You should learn to read before you try and write. No where in my letter to the AIH Dealers did I say that I had been appointed to any council. I said I had been asked by AIH to be one of 5 Dealers on the Dealer Advisory Council, and that I would only consider it if a “significant majority” of the Dealers agreed or elected me. Seems fair to me?

    My business is running fine… If you don’t want to hear my “rantings”, try another blog thread, this one was started by me in regards to “consumer financing”, might try focusing on that if you know what it is.

    Real IH #1?
    Another real Einstein, talk about someone “smoking and coking…”. By the way, I don’t smoke or “coke”… sip a litlle Crown now and then… but leave the hard stuff to idiots like you!


  60. 60 Raymond Jun 25th, 2008 at 5:45 pm

    Charles – I’m curious. Why do you think it is necessary for you to write to all of the AIH dealers? What is the new management’s take on this? I would assume they are trying to resurrect a brand and your distractions do nothing but take them away from their mission. You build a business with team players, not “I’m #1, I’m #1, I’m #1” declarations. If you require that much stroking, hire a hooker. We’re all tired of hearing it.

  61. 61 Mr. Franks Jun 26th, 2008 at 12:17 pm

    So what is going on at AIH right now as we speak? Other than honoring exisiting warraties, what else are they doing? Does anyone have some insight on this?


  62. 62 HemiBoy 9 Jun 26th, 2008 at 11:25 pm

    This is pure entertainment reading the babble from the amount of legends in their own minds that talk shit. If any of you want to go to FW and take Charles on I will pay for your flight and your hospital bills. The man sells over a 150 AIH bikes a year. The guy that bought the place doesn’t sell 30 between both of his stores. So who is the better business man.
    The thing that amazes me is you morons are blaming the wrong people for the fall of AIH. Will Garland is the guy who put 3500 to many bikes on the dealer floors and he had AIH pay the flooring on the bikes for over two years. AIH payed over 2.5 million to Textron for this plus AIH paid free shipping for over 3 years for the dealers.
    Will smoked the best cigars he could find and Sam Sumner fetched them for him. Sam is DOM on the blog. Jeff Long had a swivel attached to the back of his designer jeans that Will used for trolling to lure in the young ladies. Jeff is kinda cute and was a hit with the girls. Scott Waters was fishing in the company pond and had no idea what was going on as he had the TANG WHIFF going on. Steven Adams was busy changing the oil and getting new tires on Elaines car(Will’s girl friend in Southlake. Dwayne Moyers gave Will a contract that had a bonus clause in it that awarded him one million dollars if the company went public which would have washed the debt and made every one whole.
    Have you heard enough? Bob Shelizer was on the board waiting like a buzzard to swoop in and do his BK thing. The people that got hurt are not you assholes who show up on the blog it was the employees.
    The people who loved that company and made it what it was. The horse is dead and will never be back BD will follow and then who will Brett Smith sells his five thousand dollar enignes too?
    Charles is right the industry is full of posers and it is a damn shame that it has to end. Iron Horse had one chance to survive and because people lied in court at the BK hearing the one chance was lost. The lady had the bread to make the company survive and she got a good ole Texas F######. So I say to all of you Georges and John Abernathy’s what are you going to run your sorry ass mouths about now.

  63. 63 HemiBoy 9 Jun 26th, 2008 at 11:48 pm

    Go crawl back in your hole. You do not know your ass from third base. What the hell have you ever accomplished in your simple little life ?You probably do not even own a bike and are a poser. Charles is calling your sorry ass out what you going to do? I got a ticket for you if you want to go see the man.

  64. 64 HemiBoy 9 Jun 26th, 2008 at 11:54 pm

    Real Iron Horse #1
    You are so full of shit your eyes are brown. Call AIH and ask who was number one. Strand sold 75 more bikes than the number two guy it is public record in the BK filing. So shut up ;you are obvioulsy just some DH trying to stir the pot. Excuse me you probably smoke the the pot the shit pot that is. In case you wonder what DH is it is not designated hitter.

  65. 65 Charles Strand Jun 27th, 2008 at 3:03 pm

    I do not know who any of the bloggers are on this thread, other than those who felt good enough about what they were saying to use their own names.
    HemiBoy9, While most of what you said has merrit, I don’t need to be defended and seem to be able to stir things up just fine on my own.
    As I have stated before, if anyone wants to contact me, you know where I am; Charles@IHOT.us, I’m going back to work trying to sell motorcycles!
    Charles Strand

  1. 1 Check Out My Article on Cyril Huze’s Blog! « Charles Strand’s Blog Pingback on Jun 18th, 2008 at 10:59 am
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