Motorcycle Segment in Germany

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Germany Autos Report Q1 2012

Motorcycles
Table: German Motorcycles Segment – Historical Data And Forecasts

2010e Production: units Production: units, % chg y-o-y 104,482 2.3

2011f 105,617 1.1

2012f 107,219 1.5

2013f 108,819 1.5

2014f 110,444 1.5

2015f 112,092 1.5

2016f 113,778 1.5

Sales: units Sales: units, % chg y-o-y

190,309 -10.93

186,122 -2.20

190,134 2.16

196,394 3.29

205,070 4.42

212,746 3.74

219,523 3.19

e/f = estimate/forecast; * estimate. Sources: ACEM, BMI

Much of the demand for two-wheelers in Germany is concentrated on sporty vehicles, typically suited for leisure rather than daily transport. These vehicles make up nearly a third of the total new two-wheeler demand in the country. Enduro bikes – which usually have an engine size smaller than 650cc – are the second most popular motorcycle segment, occupying more than a fourth of the total market demand. Source: ACEM

Market Shares Of Brands Total Market

It is therefore not surprising that the segment received a hit from the global economic crisis in 2009, resulting in more than 17% fewer motorcycles, or 137,045 units, being shifted compared with 2009, according to estimates from the German Motorcycle Association (IVM).

Key players in the industry include Honda Motor, with a market share of more than 14%, followed by Yamaha Motor and BMW with respective market shares of 11.9% and 11.5% in 2009.

© Business Monitor International Ltd

Page 48

Germany Autos Report Q1 2012

Segment News
No Recovery In Sight For Motorcycles Segment

BMI has significantly revised down its outlook for motorcycle sales in Western Europe in view of growing concerns about weak economic growth in the key markets of Germany and France, while the large markets of Spain, Italy and Greece are performing worse than expected. Estimates from the European motorcycles association (ACEM) show that the market for motorcycles has contracted by almost a quarter since 2008 and we expect further contraction in 2012 as the region comes under the influence of widespread austerity measures. Although growth should return to positive territory from 2013, we see little likelihood of the market returning to pre-crisis levels at any time during the forecast period to 2016.

Crisis Or Change Of Preference?

Indeed, there is little optimism in the motorcycles segment, with sales for the first three quarters down more than 9% year-on-year (y-o-y), to 1.23mn units, despite declines of 13% and 15% y-o-y in 2009 and 2010 respectively. The blame partly lies in a sharp reversal in demand from Germany and France, both of which were posting positive growth until H111. To a large extent, this is the outcome of the general use of motorcycles for leisure rather than a means of transport in the region. It is therefore not surprising that as consumer confidence wanes owing to the eurozone sovereign debt crisis, households feel less inclined to make non-essential purchases. All of this comes at a time when sales in Italy and Spain - which together account for over 40% of all motorcycles sold in the EU - are reporting declines of over 15.6% y-o-y each.

From Bad To Worse Europe Motorcycle Sales Growth (%chg, y-o-y)

* BMI forecasts. Source: ACEM, BMI

© Business Monitor International Ltd

Page 49

Germany Autos Report Q1 2012

We have accordingly revised down our 2011 sales forecast from a 2% y-o-y decline expected earlier to a much sharper 10.5% decline. In 2012, we expect a clear divergence in motorcycle demand between the six markets. The likes of Germany, France and the UK are likely to return to positive growth, mostly helped by favourable base effects and relatively better economic conditions. Meanwhile, demand in Spain, Italy and Greece will be hit by strict austerity measures adopted by their respective governments, mass unemployment and a decrease in consumer wealth. In total, this will result in a further 0.25% contraction in...
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