The Case Of A Shrinking US Dollar

shrinkingusdollar1I continue to get the question over and over from many prominent members of the US motorcycle industry. Is it worth trying to export to Europe? And my answer is yes, yes, yes. The end of the world only comes once and I’m pretty certain this isn’t it. That means that stocks and bonds and real estate and jobs and business activity will all bounce back eventually in the US. But during this time on the other side of the big pond most European countries, at the exception of England & Spain, are living a very mild recession when you compare to the United States.

Add to this economic disparity the fact that the US dollar lost about 50% of its value against the Euro since its introduction in 2000, and all American products look very cheap to European consumers. But there is a catch. For most motorcycle products you will need to get TUV approval (short for Technischer Überwachungs-Vereinan) an organism validating the safety of products, before you can start selling in Europe. And the red tape involved can postpone your European introduction by up to 1 year. So, there is no reason to wait longer, especially if the US dollar, like many predict, continues to devaluate against the Euro. It would mean even more profit when you exchange back your Euros in US dollar.  (there are 27 countries belonging to European Union and 17 of them belonging to the Euro Zone. As of today  06/23/09.  $1.00 = Euro 0.71).

10 Responses to “The Case Of A Shrinking US Dollar”

  1. 1 Sheridan Jun 23rd, 2009 at 8:30 pm

    Hey don’t forget about exporting to Australia!! The US dollar has fallen considerably in comparison to the Australian Dollar too, and we’re technically not even in recesssion … yet.

  2. 2 Dave Blevins Jun 23rd, 2009 at 8:33 pm

    Very true. I’ve got a potential customer contacting me from the Netherlands this week, a few weeks back another from Austrailia.
    Lots of ways to ship, (most are expensive) but the market is there. I’m telling ya guys, you can show the world your stuff for free on YouTube, link it to your website,Facebook, MySpace or Ebay page and draw lots of attention to product and/or bikes. You can get paid easily thru bank transfers or even PayPal.
    Get net savvy and learn the ins and outs of international shipping, in my opinion it is well worth your time and effort.

  3. 3 John Mezler Jun 23rd, 2009 at 8:48 pm

    Very valuable info. Thanks again Cyril.

  4. 4 Kiri Jun 24th, 2009 at 1:20 am

    The TUV is only for Germany. For each European country you need a single approval of the local authority. But when you pass the German TUV, which is the strictest in Europe, then you will pass the other easily.

  5. 5 anders göth Jun 24th, 2009 at 1:56 am

    OK, I can help you guys with what ever you want. I live in Sweden and are a wellknown builder here, but not for a livin. I know many shops and if you want me to do anything just tell me. Its a big market for GOOD QUALITY parts in Sweden.

    Anders Göth /

  6. 6 Fluke Jun 24th, 2009 at 2:26 am

    I am not so sure about Europe, I spend 6 to 8 months working flat out in Europe every year (France, Germany and the Netherlands mostly). I come to the US to build bikes, ride and have fun with my savings. People are being very careful with their money now. Holding off buying luxury items until they feel more confident about the future.

    Yes, europe is a massive economy, but the bureaucracy is insane for importers, as can be import tarifs. OK, Nothing like Thailands standards, but still expensive. Allowing for import duty and local taxes, France has 19.6% sales tax for example, Sweden 25%, you will be able sell for 1 euro per 1$ in US prices, 30% more cost while you pocket the same money. Add to that the costs and hassles with TUV approval and transport costs etc I would reckon products that don’t need any changes at all to meet the TϋV need to be retailed for 40% to 50% more than US domestic prices for it to make any economic sense at all. expensive. Many parts will need to be retooled to be allowed in Europe, that can add even more cost.

    Europe is in recession though, UK is coming out at the moment but broke, Spain is in US level deep doodoo and most of the rest are just a little depressed and stagnant economy wise.

    Kiri Is right though, Put the effort into getting TϋV approval for your stuff and most of the rest of the countries will accept those standards, there are exceptions, annoying jobsworths and power crazed functionaires abound, so don’t think anything will be plain sailing if you don’t have a local contact there to sort things out for you.

    Getting into Europe isn’t cheap or fast, but then the eurozone countries have an economy that is roughly double in size the US, ignore it at your peril, especially since the US chopper craze has died. we europeans do love our bikes, we tend more towards weekend bikers though, but I don’t think there is much of a market for 45 grand plus long choppers though.

  7. 7 anders göth Jun 24th, 2009 at 5:10 am

    I dont agree at all, I live and work in Sweden. I am deeply involved in the biker buisness in Sweden. And the oldest and best builders have plenty of work to do. Yes, all the new and not serious ones have to close, but thats just good. And about the Tuv, we dont give a dman about it here. So feel free contact me if you want some help in what matter you want over there.

  8. 8 JD Jun 24th, 2009 at 9:52 am

    Bonjour Cyril, about the French market this is the surprising numbers of the new Harley sold in may 2009 by Harley-Davidson France :1287 units, and the numbers of the new Harley sold in may 2008 : 672 units.

  9. 9 dynamic Jun 24th, 2009 at 10:34 am

    i ship weekly to europe and never have an issue with payment and gratitude from the customers, its a big world out there, sell to everyone, just make sure you have your documents correct when you ship to make it easier on the customer

  10. 10 David Ryan Jun 24th, 2009 at 12:24 pm

    We recognized the weakening dollar and the need to diversify in early 2008, and have recently obtained EURO III certification for all 18 of our models in Europe. We are certified on 6 of the 17 models planned for Canada (will be certified on the other 11 planned for Canada by EOM July 09), we’re certified on all 16 of our models offered in Australia, and all 18 models are approved in Saudi Arabia, Kuwait, and Dubai. We also have a presence in Brazil, South Africa, Taiwan, Japan, England, and Sweden – and we are actively exporting to all those markets…and moving into other markets and countries actively.

    There is a lot of lead time and cost involved.

    Dave Ryan
    Chief Operating Officer/GM
    Big Bear American Made Choppers

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Cyril Huze