FOCUS – Three of Japan’s Big Four Seek Expanded Opportunities with Scooters
The U.S. scooter market is in its infancy compared to many other parts of the world, where the step-through is often the vehicle of choice for personal transportation.
However, despite the scooter’s long
tradition in such places as Asia and Europe, it appears the U.S. has become the new big
market for powersports manufacturer’s broadest line-up of technologically advanced scooter models.
Honda, Yamaha and Suzuki all produce scooters, often using satellite joint ventures throughout Asia in the production of parts and finished machines. While Kawasaki offers scooters – supplied by Suzuki – in many foreign markets, it remains the only of Japan’s Big Four powersports OEMs not selling scooters in the U.S.
HONDA
Honda now offers more scooter models in the U.S. than in Europe. American Honda’s Jon Seidel says the U.S. subsidiary makes product choices together with Honda Motor in Japan.
“There is input from both sides on new product decisions, but American Honda decides on the product line-up that best suits our customers and our business direction,” Seidel told
Powersports Business.
Honda scooter sales in 2003 were up more than 20% from sales in 2002. The company’s 50cc scooters, the Metropolitan’s and Ruckus, were its most popular scooter models for 2003, and continue to sell well in 2004. Honda claims to be U.S. scooter market leader with more than a 36% share.
For 2005, Honda has more scooter models in more new colors than ever. From the camouflage Ruckus and Blue Hibiscus Metropolitan to the Candy Dark Red Silver Wing.
“With 12 models in the line-up, Honda offers the widest range of scooters in our history,” Seidel said. “The breadth and depth of our scooter line-up covers the styling spectrum from retro to mod with all performance levels. Offering safety features like ABS and combined braking systems on certain models, and the fact that our entire line-up uses environmentally friendly four-stroke engines, we truly offer a scooter for everyone.”
Honda’s U.S. scooter line-up includes the 50cc Metropolitan and Metropolitan II ($1799); 50cc Ruckus ($1,949); Elite 80 ($2,249); the 250cc Helix ($5,099); the 250cc Big Ruckus ($5,299); the 250cc Reflex ($5,299), Reflex ABS ($5,799), Reflex Sport ($5299) and Reflex Sport ABS ($5,799); and 600cc Silver Wing (MSRP: $7,699; ABS, $8,199).
YAMAHA
“Yamaha USA works closely with Yamaha Japan to develop products that fit our market,” explained Brad Banister of Yamaha USA. “Yamaha Japan would never ‘give directives’ as to what products we’ll sell. Our team will determine what attributes our dealers and customers tell us they want to see in a product and what our research tells us will sell in our market. From there we either design new products or look at what exists in other markets to see if they will make sense for us. It’s very much a complex ‘team effort’ based on research, surveys, instinct, and group discussions.
“Scooters are a small volume product that sell well without lots of marketing from either the dealer on a local lever or Yamaha USA on a national level,” Banister continued. “Also, there isn’t a lot of margin on scooter sales. But the benefit to the dealer is a broad line-up to offer to customers coming into the dealership.”
While Banister said marketing scooters is not a high priority for Yamaha, he said Yamaha dealers are selling scooters in large numbers, and said the company has witnessed growing demand in larger urban/metro areas.
Yamaha offers two 50cc models, the Zuma ($1,849) and Vino Classic ($1,799); the 125cc Vino ($2,499); and the 400cc Majesty ($5,799). Banister said the 50cc Zuma is the number one selling scooter in the market. “Dealers are selling out of the Zuma and Vino 125; and, depending on what month you look at, the 50cc Vino is neck and neck for the number two position with the Honda Ruckus,” he said.
SUZUKI
American Suzuki offers only the Burgman 400 ($5,699) and 650 ($7,799) scooter models, but Marketing Manager Glen Hansen said that is likely to change. While Hansen couldn’t say when Suzuki may enter the U.S. market with a 50cc unit, he did say it wouldn’t be with the two-stroke 50cc Katana R the company sells in Europe.
“It’s not a segment we spend a lot of time talking about here, but we know it’s incredibly important and we eagerly await being able to offer more scooters once we have the right engines that’ll let us get into that smaller market,” Hansen told Powersports Business. “We’re looking at the market, and we’re looking at how to make our current models a little cooler and racier with some options or a limited edition, and we’re looking at smaller engines to perhaps expand out line in the near future.”
He said American Suzuki usually travels to Japan in April to see new product and start talking about quantities. “We can look at individual products and say yes or no,” Hansen explained. “The factory certainly encourages American Suzuki to take everything, but they know that we know the overall market.”
Such strong consumer reaction to Suzuki’s two big-bore scooter models wasn’t expected Hansen said. “We are talking small quantities, just because we bring so few in … a couple of thousand each, maybe,” he said. “However, through September, we’re way over what we budgeted saleswise for these things, so we’re going to run out.
“The 400 is doing particularly well for us — I think, perhaps, because it’s more in the price range of a scooter.”
Hansen said American Suzuki doesn’t “put a lot of effort into marketing scooters at a national level.” Still, he said the scooters displayed at major events seem to attract consumers.
“When we go to events, we spend all of our time talking about our GSX-Rs and our Boulevard cruisers, but people want to see our SVs, they want to sit on the V-Strom, and they’re curious about the Burgman,” he said.
KAWASAKI
Patrick Kelly, Kawasaki USA’s director of product, planning and research, said there are three reasons why Kawasaki chooses not to enter the U.S. scooter market.
“The first is market demand,” Kelly told
Powersports Business. “Although the scooter segment has recently shown moderate increases in demand, it has historically been declining or flat. Additionally, the current size of the scooter market does not warrant the investment required to create a reasonable and profitable level of market share.”
The second reason Kelly cites for Kawi declining entry into the U.S. scooter market is an increasing demand for other powersport products. “Because our other markets in which we already compete – ATV, cruiser and sportbike markets – are showing strong growth, developing new product in these categories is a top priority,” he said.
The third reason Kelly cited is an increasing number of competitors. “There are a growing number of off-shore, imported scooters from Korea, China and Taiwan,” he said. “These manufacturers are able to sell their products at extremely low prices due to lower costs of manufacturing as well as lower quality levels. This makes developing a new scooter while maintaining Kawasaki’s standard quality levels at competitive MSRPs very difficult.”
