Motorcycle Market Trend Jan 2017

Motorcycle Market Trend Jan 2017

Paul McDonald

21 Dec 2016, Editorial

Market Trend

November 2016 motorcycle sales

After a highly successful 2015 that exceeded forecasts with a total volume of 114,160 two wheeled machines registered, the MCIA predicted another increase during 2016. At the beginning of the year the expectation was for around 124,000 registrations by year end.  However, now that we have reached the end of the year, is it likely that this target will be exceeded?

According to the MCIA, total registrations for November saw an impressive increase compared to November 2015 and were 12.3% up over the same period last year while the year to date total of 116,769 compared to 108,983 last year and was 7.1% ahead.  So, at the end of November the total registrations for 2015 had already been exceeded and the forecast for 124,000 total registrations for 2016 was clearly still within reach.  However, whether the target is achieved or not, 2016 has definitely been a very successful year for the industry and saw a particularly impressive start with sales being well ahead of those at the start of 2015.  Although, the differences were then less marked, the upward trend continued and with the exception of July, which saw a very slight dip over 2015, the trend of 2016 has been one of growth.  Considering the huge amount of uncertainty generated from the Brexit result in June, the Euro Cup football tournament and an indifferent start to the summer, this makes it all the more impressive!  However, the full year statistics will be the final judge when they are available.   

Looking at the table above, geared motorcycles excluding scooters saw a substantial growth of 16.6% with a total of 7,038 registrations compared to 6,042 in 2015.  The year to date total is 7% up on last year with 83,981 bikes registered compared to 78,514.  A number of categories saw an increase in November after a decline in October which is interesting.  Until July, custom bikes saw a month on month uplift in registrations this year, sometimes by a considerable margin compared to the same period last year.  However, since then they have seen a decline every month but the trend reversed again in November when they saw the largest growth in registrations in the market of 25% over November 2015, albeit these are relatively low volume sellers.  Touring bikes saw an increase for the second month running after a period of downturn with registrations 24.3% ahead of last year.  Scooters continue their success with registrations 16.1% ahead of last year in November.  Meanwhile, Trail/Enduro bikes experienced the largest year to date increase at 19%.  However, Naked bikes are the most popular style year to date with 32,598 registered year to date at the end of November.  This compares to a total of 28,989 registrations at the end of November 2015.

In October, it was surprising to see an increase in moped registrations by 0.6% over the same period last year.  However, it was thought that this was likely to be a blip and the downward trend would resume moving forward.  In November registrations for mopeds were 23.3% down so the decline continues but nevertheless it will be interesting to see how they perform moving forward.  Sports/Tourers witnessed another decrease in November of 41.7% and their year to date total is now 2.7% lower at the end of November than compared to last year.

The following table shows that once again, machines over 1000cc recorded the largest increase in registrations in November at 32.26% and were 9.01% ahead year to date.  Surprisingly machines between 51-125cc saw a decline in October by 1.67%.  However, in November, their growth resumed and were 8.14% ahead of the same month last year, whilst their year to date total grew by 7.69%.  Bikes between 126-650cc saw a large increase of 26.91% over last year and this also followed a dip last month.  Also, machines between 651-1000cc experienced an uplift following a decline last month and are now 18.27% ahead of 2016 while their current year to date saw an increase of 5.75%.  Meanwhile, bikes between 126-650cc saw the largest year to date growth of 14.65%.  As expected, following a slight uplift in October, machines between 0-50cc saw a decline in November by 20.83%, whilst their year to date total was 8 .72% behind last year.

Engine band

Motorcycle registrations in November 2016 by engine size

Top selling models

Top selling motorcycle modesl year to date 2016

Survey Winner

Congratulations to Guy Steel from Chiswick Honda who won the voucher prize draw in November for taking part in the Glass’s online motorcycle trade survey.

MCIA Motorcycle Live 2016

The UK motorcycle industry show was staged at the NEC from November 19th to the 27th.  With a final attendance of 113,172 motorcycling fans visiting over 9 days, this was an increase of 2.4% over 2015, so the show proved to be a success.  There was a great turn out of exhibitors and their stands were all very impressive which helped contribute towards an atmosphere that was buzzing.  As well as a high number of manufacturers there were also plenty of accessory stands which were equally as splendid and much like previous years there was certainly plenty to do.  As usual there were various motorcycle demonstrations and an indoor show to keep the crowds entertained and the smell of burning rubber and petrol always adds effect!  Speaking to various manufacturers, many were very upbeat about the interest generated from the show and were very much looking forward to 2017 with lots of new exciting models in the pipeline.

The Motorcycle Industry Association, which ploughs all profits from the show back into promoting the industry, used the event to announce a new partnership between Highways England, MCIA and police chiefs with the launch of a jointly written whitepaper - ‘Motorcycle Safety and Transport Policy Framework’.  This sets out how roads can be made safer for motorcyclists and calls for their inclusion in mainstream transport policy.  Highways England is in a position to make physical changes to the roads, and will be using the guidelines produced by the UK’s Institute of Highways Engineers, which identify specific changes to make highways better for riders.  MCIA’s Steve Kenward is quoted as saying ‘We think this partnership gives us an unprecedented opportunity to make a real difference to riders – the ones on the roads now and the ones who will inevitably get onto a motorcycle or scooter to beat congestion.”  MCIA is calling for all in the industry to support the Framework in their own PR. It can be accessed online at http://www.motorcycleframework.co.ukor if you would prefer a PDF email press@mcia.co.uk

New Sales

Combined feedback from dealer visits and subscribers who kindly responded to our web based survey in November showed that the positive trend of the market continues with 60% of respondents reporting a rise in demand over last year while 20% felt it was broadly in line and 20% thought it was not so good.  The Honda PCX125 was said to be a good seller, as was the BMW GS and S1000 RR.  Other popular machines were KTM Dukes, the Suzuki GSX1000, GSX1250 and Van Van 125.  As with recent months, a few dealers reported quieter sales due to having less stock in preparation for Euro 4. 

However, once stock levels have been rectified in the early months of the year and new models launched, sales should see an increase.  The majority of feedback from manufacturers at the MCIA Live Show was positive with sales being ahead of 2015, despite some reports of a difficult summer due to the combination of poor early weather, the Japanese earthquake and Brexit.  The good news is most are optimistic for 2017 and well prepared for Euro 4 and without too much of a surplus of Euro 3, this should help minimise any negative effect on residual values.  This will be carefully monitored over the coming months as dealers may have increased their number of pre-registrations during December or offered last minute promotions to clear stock. After a short dip in sales for some during the summer, there appears to have been little effect from Brexit so far.  However, as previously reported, it is likely that 2017 will give a better indication with new prices set to increase, as a result of exchange rate changes, although good finance deals could help counteract any potential negative impact on sales.

50% of respondents said they are offering the same level of discounting this year, 25% giving less, just 8% offering more and 17% said they are not discounting at all.  Whilst many dealers are well prepared for Euro 4 and do not have too much Euro 3 left, some dealers said they are offering some good rate finance deals, whilst others are offering a healthy cashback on certain models.  Also, a high number of machines are already Euro 4 compliant.

Customer finance penetration saw another surge in November with 55% of respondents confirming an increase, 27% offering the same amount and 18% giving less.  Unsurprisingly, PCP remains the key driver but some dealers are still preferring to focus on 0% interest deals instead.

Feedback on stock levels was rather mixed with 40% stating their stock levels were broadly in line with those of last year, whilst 40% felt they were worse and the rest said they were better.  As expected, the main reason for lower stock this year is due to dealers concentrating on keeping levels leaner due to Euro 4 and it is better to be understocked than over stocked in this situation.  A few did mention that supply from manufacturers had not been so good this year.

The market is now in the depths of winter and Christmas has been and gone.  Feedback on business volumes was quite mixed with 46% of respondents expecting a decline, 38% feeling it could remain broadly in line and 15% predicting an improvement over the next month.  Many felt a drop was likely due to the time of year and although some thought that volumes could remain level it’s very weather dependent.  Curiously a few expected that while a decline in used volumes was likely, new volumes were expected to remain level.

As expected, it was a very similar story with profitability.

Used Sales

Feedback on demand for used machines during November continued on a mixed note with 38% saying it was better than November 2015, 38% feeling it was broadly in line and 23% stating it was not so good.  Some dealers continued to report that demand has been affected by PCP making new purchases a more appealing proposition and some felt demand had dipped due to lower new sales leading to less part exchanges and consequently lower levels of stock.  However a few respondents stated their demand had increased as they have invested more in their used business and consequently now have more in the way of high quality stock.  Some also said that after experiencing a good end to 2015, the end of 2016 was equally as impressive due to dry weather persisting.

Stock availability looked to be a little more positive in November with 73% reporting it to be broadly in line with that of last year, 18% feeling it was not so good and 9% said it was better.  Interestingly, after many dealers have seen a decrease in part exchanges, thought to be due to the private sales on the internet, some recent feedback suggested that they have seen an increase due to higher new sales volumes.  While the internet continues to cause some issues in finding good quality stock with some respondents stating that going out and actively buying stock in the market has been more difficult, maintaining good contacts in the industry has helped to overcome this problem. 

According to dealers, 50% said their own stock levels were broadly in line with November 2015, 42% felt they were better and only 8% thought they were not so good.  Indeed, with a few respondents reporting a 10-20% increase in stock it highlights the positivity in the market and it will be interesting to see if this continues over the next few months.  However, it’s very uncertain at the moment as there is a chance that exporting to Europe could start again due to the weak pound which would further hinder availability of good quality used stock.  If exporting does not occur as some fear and we see an increase in machines enter the market on the back of PCP deals, it’s likely that availability could strengthen although this may subsequently pressure values.  Certainly interesting times ahead.

December 2016 was always likely to be somewhat colder than December 2015 and the month did indeed start with a more seasonal feel and a few days of sharp frosts.  However, the weather turned much milder and continued with a fairly dry theme.  Taking this into account and with the Christmas festivities over, the majority of values have been held for this edition of the data except where trade feedback or evidence from the market place has indicated adjustments where necessary.

Glass’s hope all our customers and contacts had a great Christmas and are looking to forward to a prosperous New Year!

About the author

Paul McDonald

Paul McDonaldLeisure Editor

Paul has worked for Glass's since 2001 in various customer and vehicle valuation orientated roles, before becoming Leisure Editor just over a year ago. In his current role, he's responsible for keeping up to date with conditions and trends in the Motorcycle and Touring Caravan markets so we can provide accurate and reliable values to our subscribers. This means he's out and about a lot visiting dealers, manufacturers and auctions as well as analysing observation data.