July 2, 2007 – A wild sales swing lifts Yamaha Motor

Yamaha Motor Corp.’s dramatic recovery in a key Asian market has led to its recent overall motorcycle segment gains.
The manufacturer reported more than a 20 percent increase in its motorcycle sales in its fiscal 2006 report. A big reason for that increase — its rebound in Indonesia, the world’s third largest cycle market — was detailed in its recently released 2006 report.
The annual report documents how Yamaha went through a wild swing in its market share in an area in Asia encompassing Indonesia, Vietnam and Thailand. In roughly a 10-year period, Yamaha went from having 30 percent of the market’s business to less than 10 percent, then back up to nearly 30 percent.
The pendulum-type sales started with a currency crisis involving several Asian countries in 1997. The result: The overall motorcycle market crashed by more than half, to 1.3 million units in ’98 from 2.9 million units the previous year. Yamaha’s sales, however, dipped even more, dropping nearly 78 percent.
After the currency crisis stabilized, the market slowly recovered. But Yamaha’s business did not follow the market trend. Instead, “slow response” to demand for four-stroke motorcycles, “sluggish investment” and “a failure to promptly reform” the area sales network slowed the company’s rebound, according to the annual report.
But in 2002, Yamaha launched a new business management plan that aimed at increasing four-stroke models, creating a marketing strategy that would distinguish it from its competitors and strengthen sales networks and production. The latter has seemingly played a huge role in Yamaha regaining its market share. The company’s production capacity in Indonesia, Thailand, Vietnam, Philippines and Malaysia has jumped to 3 million units in 2007 from 1.4 million units just three years earlier.
New models also keyed the recovery. Yamaha launched a series of sporty four-stroke vehicles as well as a lineup of automatic models.
As a result, Yamaha’s unit sales increased by 19 percent in 2006 even as total Asian market sales decreased. psb

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