Yesterday we reported Indian made great strides in Q3, with a claimed increase in retail sales of 16% – a day on which mothership Polaris’s stock (PII) jumped the same 16%. In that same third quarter, Indian’s cowboy, Harley-Davidson, saw its sales decline 8.1%. Unlike Indian, H-D actually breaks out numbers: 45,469 units sold domestically in Q3 2016 slid to 41,793 in Q3 2017 – and 161,658 units for the whole year. Domestically.

In the U.S., Indian says it jumped from owning 3% of the over-900cc market last year, to over 10% of it by September, 2017  (and this in a market where sales of all bikes over 900cc was down 9.2% for the year, according to H-D). Ten percent of 161,000 tells us Indian sold around 16,000 heavy cruisers.

What does this tell us? I think it tells us more people are buying Indians lately, but it’s way too soon to put the fork in Harley-Davidson. The faithful knew the new Milwaukee 8 was going to be in more 2018 models, and many buyers decided to hold off buying until they appeared. It’s a pretty safe bet that, with the release of eight new Softails last August, things will probably be seriously picking up in Q1 of next year for H-D if not in Q4 of this one. It’s no coincidence Indian saw its big gains this year after releasing its new Chieftains Elite and Limited, and Roadmaster Classic early this year. People like new and improved.

On another positive note, things weren’t quite so bad for H-D’s international sales, which fell just 4.6%, from 23,486 to 22,416 units in the third quarter. Like Coca-Cola, Levi’s and Marilyn Monroe’s mole, there are just some distinctly American brands you can’t kill without a prolonged and savage beating. Indian is still trying to establish its overseas beachheads.

How can you not love that face?

Still, it’s a remarkable feat of corporateering for a brand Polaris didn’t acquire until 2011, and whose first new bike launched in 2013, to have already captured a 10% US market share in just four years: In nearly 20 years of trying, Victory never came close to that. If you’re H-D, you have to be a little concerned about the trajectory. From a Motley Fool article in May of last year:

Since relaunching the [Indian] brand, Polaris’ total revenues have increased 47% to $4.7 billion, but motorcycles have grown from accounting for 8% of the total to 15%, and sales have nearly quadrupled to $698 million annually. That may be a rounding error to Harley-Davidson, which did $1.3 billion in sales in the first quarter alone, but Polaris has already become the No. 2 motorcycle manufacturer. 

With Polaris motorcycle sales growing 67% last year and Harley-Davidson’s falling almost 2%, if those trends continue, Polaris will be selling more motorcycles than Harley in just three-and-a-half years. Of course, it’s highly improbable Polaris can maintain the breakneck pace it’s been on, but it’s also clear it can dramatically narrow the gap between first place and second place in short order.

Now that Polaris is past the recall problems with its Slingshots, done with the worst of the Victory bloodletting, and even owns the 2017 American Flat Track championship, well… a lot of people say Indian is the best thing to happen to Harley-Davidson. A little  competition is good for everybody. Especially for people who ride motorcycles.

 

 

 

 

 

  • Larry Kahn

    What’s with you and the Indian=war themes? “Indian wars”, “Indian sales warpath”? The Indian name was chosen in 1901 out of respect for the people, might want to give that some thought.

    • Buzz

      Excellent virtue signaling. You get five points on the Lefty “I’m Offended” scale and you are that much closer to Lefty heaven whatever the hell that is.

      • Larry Kahn

        Feel better now?

  • Sayyed Bashir

    JB: I like your article but I have a few issues: You estimated Indian sales to be 10% of HD’s 2016 domestic sales of 161,658, but Polaris claims 10% of the market share, not 10% of HD’s 2016 sales. And for 2016 they claim only a 3% market share. Finally I don’t trust the percentages Polaris puts out. It is marketing speak rather than facts. They never say how many bikes they actually sold. They kept saying Victory was doing well until they suddenly buried it.

    • Born to Ride

      I noticed that too. And yeah, I reluctantly agree that if Indian wants to talk shit, they should offer up cold hard unit figures. Other than that, I find it disturbing that you post this same rant in every Indian thread. We get it man, you’re suspicious of Indian’s sales figures. Join the club, buy some stock, then let us know once you make CFO.

    • Gary Latessa

      So you think Indian is not doing well? And they really are not on Harley’s radar. Indian is the real deal. You need to get over to your local Indian dealer and ride one. If your not impressed your not honest with yourself. Just wait until they get a new platform. I for one am glad to see the brand doing well. You should thank them for the Milwaukee 8 and the new Softail.

      • Sayyed Bashir

        What new platform? Indian can’t afford to come up with a new platform like the Milwaukee Eight or to redo their entire line like Harley did with their Touring and Softail models. They have to sell their existing models first and now people are paying even less attention to them after Harley’s latest models came out. All Indian has done over the last year is come out with different paint jobs and accessories. I was at the Harley dealership today and there were 150 to 200 people there going on different charity rides and things. Show me a Indian dealership like that. The rides were not Harley specific but I didn’t see a single Indian and only one Victory. At the Street Vibrations in Reno and Virginia City a few weeks ago there were thousands of motorcycles, 97% of which were Harleys, 1% Indian and Victory and 2% others. If Indian is selling that many bikes, where are they? I don’t see them on the road and I ride everyday. Do you own a Indian? Are you planning on buying one?

        • SerSamsquamsh

          Although I like the Scout I’d say Harley bikes seem much more appealing. Underestimating a determined competitor is always a mistake. The new Roadster and Softtails are a strong reaction to market pressure but they can still do more. Explaining away criticism is a waste of time.

        • mikstr

          “All Indian has done over the last year is come out with different paint jobs and accessories”

          when they have been at this for decades, as Harley has, then you can have something to criticize….. MIlwaukee wrote the book on putting lipstick on pigs… or have you forgotten that already, having been swept up in the M8 hype (as most Hardley fanboys)?

          Reality sucks, huh? So much hatred….. The born-again Indian is the real thing and making significant inroads into the Poser Empire…. ha ha ha Enjoy the ride….. just think, someday, you will recall this as Harley`s good old days…..

    • john burns

      whoops. Harley still claims around 50% of those big-bike sales, so the total sales must be something like 320,000 – which means Indian must be selling around 32,000 a year in the US.

    • John A. Smith

      I can’t believe we actually agree on something. Polaris’ 3Q2017 10Q, literally, uses the word Indian just 4 times in the entire filing, vaguely states that “Indian Motorcycle sales increased in the low-twenty percent range in the third quarter,” but at the same time, the revenue numbers reported immediately prior shows company-wide motorcycle sales were down overall by 15% from the prior quarter. And yet, Polaris started shutting down Victory 6 months prior to the beginning of 3Q. You’d think that if they’re going to disclose $155M revenue on motorcycles in 3Q, they’d want to be specific about the brands they maintain. By comparison, HD had $1.15B in motorcycle revenue in 3Q2017, compared to $1.27B in 3Q2016, a drop of 10% year over year. Both Polaris and HD are seeing sales drop, but HD is weathering the sales drop far better than Polaris is. The bad part, though, for HD is that income dropped almost 40% year over year, and operating and gross margin both dropped precipitously at the same time and are barely at 2%. Big increases in manufacturing costs along with a sales volume drop isn’t a good sign for anyone. Indian isn’t eating HD’s lunch, for sure, but if HD wants to counter Indian market incursions, a 2% margin doesn’t leave HD much room to cut price to maintain market share.

      • Sayyed Bashir

        I think HD had to spend a lot of money developing the Milwaukee Eight platform and the new Touring and Softail models, which will pay dividends in the long run. Many people were also holding off buying the previous models until the new models came out. HD will not cut price to compete with anyone but did offer a rebate earlier this year on previous year’s models. HD has a 53.1% market share of the over 600cc domestic market.

  • Max Wellian

    Indian sells a lot of $12k Scouts…and probably most of them to military vets who get another grand off.
    Go to any “biker” event and it’s all HD touring bikes…which have MUCH higher margins.
    Not exactly apples to apples just comparing displacements.

    • Gary Latessa

      Military gets 500 in accessories on Scout’s and a grand off 111s. Indians are making an impact. That’s the bottom line. I’m not sure why some want to deny the facts.

      • Sayyed Bashir

        You work for Indian?

        • mikstr

          do you work for Harley?

          • Douglas

            I think either that, or he’s a large shareholder. It seems to be his religion, perhaps with an altar in the garage with candles, H-D shields emblazoned on it, a kneeling bench (w/ the predictable logo) covered w/black leather, and on the wall, an H-D clock, on the floors, Harley welcome mats. But no room left for the car, so it sits outside…..at any rate, he’s very sensitive about and protective of his (seemingly) main raison d’ etre, so go easy on him…..

  • Christophe Poteaux

    Should the growth of Indians sales be due to the shutting down of Victory? My guess is that a good chunk of customers interested in an American non-HD had only one choice left. Just my two cents.

    • StripleStrom

      Victory just didn’t have the traditional appeal of Indian, as shallow as that may be. I think it’s a joke, as Indian is no more Indian than the other iterations brought by previous owners before. At least they have an original (non-Harley-clone) platform. I think they are legitimately good motorcycles that can compete with HD on specs alone, but the legacy is what is putting them over the top where Victory couldn’t pull it off. That, and the swoopy and weird lines of Victory just didn’t appeal to a lot of us. That is how petty the average American consumer is.

      • Buzz

        How is not liking something because it has swoopy and weird lines petty?

        The Indians are much better looking than the Victory.

        • StripleStrom

          I was speaking to the lack of heritage, whether perceived or real. It’s a totally stupid and petty reason to not buy a motorcycle.

          • Buzz

            Don’t all motorcycle manufacturers sell heritage? Either Old Timey or racing?

          • StripleStrom

            I guess on some level that’s true, at least for American and European makes. Japanese makes sell more on performance and value, in my opinion.

          • Born to Ride

            Or both!

        • john burns
          • StripleStrom

            barf. fugly.

          • Buzz

            Yeah nothing swoopy and weird about that!

  • John B.

    When you are gaining market share at the industry leader’s expense it’s a great day.

    • Sayyed Bashir

      If only it were true. HD still has a 53.1% market share. Whose market share is Indian stealing?

      • mikstr

        so much hate for Indian….. hurts to see them taking bites out of Milwaukee Inc`s precious empire…. enjoy the ride, it`s going to get worse, a lot worse…… lol

  • Buzz

    I think it’s incorrect to say Indian is gaining market share at H-D’s Expense. Sure some buyers may have chosen Indian over Harley, but how many more have chosen Indian over metric cruisers.

    The “never Harley” buyers always had to go metric or later Victory.

    Before I attributed Indians gains to H-D struggles, I would love to know how Star, Shadow and Vulcan sales are going. My guess is in the toilet.

    I have a friend who works at a Big 4 in Temecula. I always get the latest on the floor anchors when I talk with him.

    • john burns

      Definitely part of it. Do Indians use metric fasteners or inch?

      • Buzz

        Feather or Dot?

    • Born to Ride

      Temecula motorsports creates floor anchors by charging a 1500-2000$ markup that is mostly non-negotiable until the bike is a year or two old, and then they offer a 1000-2000$ discount. Bikes that really sell like garbage **cough ninja1000 cough** can get marked down as much as 4 grand, but that 1899$ “set-up” fee is still there, and still non-negotiable…

      • Jon Jones

        This is common at scuzzy dealers.

      • Gabriel Owens

        Ninja 1k is a nice bike.

        • Born to Ride

          Indeed, I’d have one if I could afford the insurance.

    • Sayyed Bashir

      And now it seems even the “never Harley” guys are taking a serious look at Harley’s new models. Many have taken test rides and have been impressed.

      • mikstr

        and many “never anything but Harleys” are trying Indians and switching, as the sales numbers indicate…..

      • Kevin Vance

        And why do you think, is that? Because the new M8 engine sounds nothing like a Harley, and they now sound like metric cruisers. So those guys might actually be interested in them.

        • Sayyed Bashir

          I think they are attracted by the sportier designs and performance, not just the sound of the engine.

          • Gary Latessa

            I think Harley is struggling with new customers. Some of these new bikes may help that. Time will tell.

  • Goose

    I don’t know what the actual numbers are but the one inarguable fact is that Polaris/ Indian is the best thing to happen to Harley riders since the AMF split. I haven’t gotten to ride a new Softail but I’ve ridden the M-8 in a Road King, the improvement, no engine heat in 105 air temps, much less vibration, more power, etc. is spectacular. Based on my experience it is now a better engine than the Indian big twin. Now, where is the equally improved Sporter to fight the Scout? Hint: The Street isn’t the answer to that question.

    Now, can Indian respond with their own improvement program for the Thunder Stroke 111? I sure hope so.

    • spiff

      Harley needs Indian just like coke needs pepsi and ford needs chevy.

    • Sayyed Bashir

      It takes a lot of money to develop a new engine platform and one has to sell a lot of existing models to come up with that money. Indian is stuck in this catch-22: “a paradoxical situation from which it cannot escape”. HD has upped the ante with the Milwaukee Eight and the all new Touring and Softail lines and Indian cannot do anything about it.

      • Gary Latessa

        Indian is bringing another platform. You can bet on that.

        • mikstr

          they have brought two out in a very short time span… not a bad start… compare that to Hardley’s inertia over the last century….

      • mikstr

        care to explain why Hardley, cash-rich over the past 2 decades, waited so long to develop new platforms then? The kept re-hashing the same crap year after year, letting Willie G work his poser magic on warmed-over dinosaurs… You’re a hard act to follow…. consistency is your friend, remember

      • Goose

        I don’t know about the third platform mentioned below (but I’m very interested in knowing more about it) but Polaris has very deep pockets. As long as Polaris’ upper management team believes the ROI will be good upgrades and new products will keep flowing from Indian.

        • Sayyed Bashir

          I know Polaris has a lot of money but they will spend money where they can make money. Each division is independent and has to be independently profitable. The parent company cannot keep bailing out divisions that are losing money. They lost $100 million on Victory before they finally killed it. The motorcycle division has lost 14% in sales. Do you think the parent company will keep on putting more money into it? Don’t you think they have learned their lesson from Victory? At some point they will have to decide whether they can compete with Harley or not. Many have tried before but all have failed.

          • Gary Latessa

            Your as bad as fake news. The Motorcycle sales are up. Slingshot has drug the 2 wheeled numbers down. Indian sales are absolutely up. I don’t think they will ever reach Harley numbers. But they will certainly hit Ducati numbers and probably even better. Considering Ducati world wide sales of about 55,000 Indian is already 1/2 way there in a short 4 years. And they still don’t have a complete line up.

          • mikstr

            “I know Polaris has a lot of money but they will spend money where they can make money. ” and when they do (like when they bought SwissAuto) folks like you will whine that they are not playing fair…. lol

            as for competing with Harley, they seem to be doing well. Their sales are going up, Harley’s are going down, what’s so hard to understand…. do you need a graph to help you visualize it?

  • James Edward Zeiser

    It will be interesting to see what’s next from Polaris. Do they leave entry level to
    others or take the bull by the horns. Will V-Twins be the only thing they build. One has to wonder if Spirit Lake knows the last real Indians from Springfield were vertical twins. Even cooler would be inline fours from Ace copies.

    • Sayyed Bashir

      Entry level bikes cannot be manufactured economically in the U.S., Europe or Japan as all the big manufacturers have learned. They are mostly going to be bikes made in India, Thailand, Indonesia or China.

      • Buzz

        So a Harley built in India is an Indian?

        • mikstr

          LOL

      • JMDGT

        Sure they can.

        • Sayyed Bashir

          For example?

          • JMDGT

            The ability to economically make/manufacture an entry level machine exists in all of the markets where the OEMs have a production facility. Added costs in taxation and regulation make it less profitable not impossible. Business 101.

          • StripleStrom

            I think you’re making an argument just to be argumentative. Sure, anything is possible. But, if it was a good decision, it would happen. I think the best argument that it isn’t profitable is that nobody is doing it!

          • JMDGT

            The best argument is they can but choose not to for business reasons. Neurotic projection is the most common variety of projection and most clearly meets the definition of defense mechanism. In this type of projection, people may attribute feelings, motives, or attitudes they find unacceptable in themselves to someone else.

          • Born to Ride

            Wait… Are you a lawyer too!?

          • JMDGT

            I’m not but my neighbor is.

  • conchop

    Very well written and informative article – Years ago, I was a Victory Dealer – Polaris was hard to deal with and they made sure they always got theirs – There’s now a long trail of busted dealerships – But there is no arguing with the bikes; Indian’s rock – they are good – Harley’s new M8 and Softail’s certainly offer a wider spectrum of bikes this year – A lot more modern and athletic looking – So the boardrooms should be on the edge of their seats – Brand building is going to be easy for these two iconic names – Corporate suits can run off a lot of people with their lack of understanding of the biker world – HD and Polaris sure can leave a lot of money on the table – Love the numbers analysis in this article – Makes for a good crystal ball …

  • BDan75

    Just a small sample, but I’ve certainly noticed a lot more Indians on the road this year–mostly the big ones w/ fairings.

  • RMP52

    Well good luck to them all, the more bikes sold the better, whether Harley, Indian, or ?. Personally I really haven’t seen an Indian that excites me, but then I’ve never been a big Harley fan either. Harley made a good effort with the Street 750, but it’s not quite there yet.

  • Lucid_American

    Lets see how well Indian does at building its dealership and support network. Rolling into a Polaris dealership for a problem with your Indian isn’t going to be an inspiring or rewarding experience – and most riders do not consider that proper dealer support. Indian has to establish a culture around that brand other than lone wolf riders who just want something other than a Harley Davidson or Metric Cruiser.

  • Mike Reese

    One thing I believe is hurting HD, is the EPA restrictions, and HD forced to question warranties if anything is done to the bike, especially emissions related. With any HD, you customize it, personalize it, that part of the experience- it’s difficult to do when there is a threat of losing your warranty especially with the M8 being new and not fully long term tested. The lack of 3rd party for the M8 hurts too. This is why the used HD sales are way up, no concern about losing warranty, personalize the bike like you want.
    If you look a the HD used and new market together, Indian’s market (new/used) is probably one percent. Of the big Indians I have seen, don’t see much customization or personalization, this will result in losing market as the newness wears off in a couple of years. Look at most sport bikes, when new on the market, they are hot, but quickly lose value in a couple years ago. The M8 and the new softails will help counter this recent drop over the past year or so.
    HD definitely need to address the main market loss in the smaller bikes like the Sportster, that is where Indian is gaining the main market share with the Scout. The Streets are just rebranded, half ass redesigns of the VROD towards a younger crowd. A really good redesign of the Sportster should affect the Scout success.

  • Jim L

    I think it’s a good test of HD. It has made them step up and make a better product. Competition is good in the marketplace.

  • Kevin

    Just as I suspected: more Neanderthals dragging knuckles in here than a Planet of The Apes audition….

  • johnbutnotforgotten

    10% of 161,000 tells us you don’t read your own text. according to your previous paragraph Harley sold 161,000 units and Indian grabbed 10% of the total market, not 10% of the amount Harley sold. So if Sayyads assertion is correct and Harley had 51% of the market, that would mean Indian sold around 30,000 units.
    However, if the market dropped 9.2% and Harley’s sales only dropped 8.1%, then their market share didn’t necessarily increase.

  • tom

    As a disgruntled Victory owner, I’m curious how many of us Indian persuaded to join their ranks (if any) and if that impacted Indian’s initial growth. I know for sure I don’t trust Polaris and that goes for most of the local Vic owners in my area. We have road tested and respect the Indian bikes but wouldn’t buy one. Never been a “Harley Hater” but always felt they were overpriced for what you got. Hmmmm, maybe Triumph is where I need to spend some time.

    • Born to Ride

      Thunderbird 1700 is a sublime cruiser. Floorboards are too low though, the California 1400 got my money.

  • Michael W

    Looking at it from a viewpoint as far away as Europe, I can say that both brands have a problem with high prices and low horsepower.
    These problems are even more noticeable overseas, because taxes are extremely high there. In Europe the top Harley models are around USD 50k, in Indonesia USD 100K.
    The average speed on the European Autobahn is very high as well. Try to quickly overtake somebody who is going 100+mph, with your Harley…
    And the European pollution laws urge both brands to further cut horsepower and sound, by using very restrictive mufflers.
    And then there is one more thing: Even 2018 Harleys still have a surprisingly small frame. Wheelbase is only 1630mm, which is making even their biggest bikes look small. Indians are visibly bigger bikes, which helps in terms of bragging rights and pride of ownership.
    On the other hand, the M8 114 makes slightly more horsepower than Indian. But it would need to be bumped up by 50%, not 5%. BMW’s new bagger is 160hp for a reason.
    So both brands have a lot of work to do, and their challenges are high. Future will tell if they succeed.