I recently announced that the auction date for the Erik Buell Racing assets had been established for the 21st of July. As I was writing that piece of news, a fancy idea came to my mind.
The first auction is trying to sell ALL the EBR assets as a single lot. This means that the company, which is now under receivership, is to be sold as a whole business, including everything it owned at the start of the receivership.
Motorcycles in stock, spare parts, engines, intellectual property and pretty much all there was under EBR's roof, so to speak. From a technical point of view, if a guy steps in and buys EBR, he or she could restart the production right away.
Or, for what's worth, use pretty much any of EBR's assets to start developing a new machine. We know that Erik Buell Racing has already done development work for Hero Motocorp in the small-to-middleweight segment. At EICMA 2014 EBR officials also confirmed for us that the company was envisaging expanding the line-up with smaller displacement bikes and was also eyeing delivering a sport-adventure machine. Even cruisers were part of the discussion, though they were more of a "we don't dismiss the idea of building a cruiser" thing.
All in all, this means that EBR might have already made certain steps in the development of new bikes. Now, it's been several years since the customers have become more interested in smaller bikes because of their better fuel efficiency, lower maintenance costs and, of course, lower prices.
Whoever decides to buy EBR, if anyone at all, could take profit from this direction. Some say that such a scenario might look a tad too radical, but given how EBR performed (or should I say, didn't perform) in the last years, it only looks like a "extreme conditions demand extreme responses" thing.
MV Agusta is also stepping into the game and we are still expecting moves from Yamaha and even Honda, despite the rather high inertia the latter seems to struggle with.
BMW showed how things are done as they took the S1000RR engine, down-tuned it a bit to make it less savage and more manageable, loaded it into a chassis that is more suitable for traveling, equipped it with smoother suspensions and voila! The S1000XR arrived to change the whole game, and it looks like BMW delivered what a whole lot of people were dreaming about.
EBR had plans to deliver a sport-adventure machine in the guise of the 1190AX. I got this from the very source and I also know that it was regarded as being the potential boost EBR needed.
With all the sporting heritage that comes with Erik Buell's name, such a motorcycle could represent an interesting move towards making EBR a profitable company once more.
Working on tweaking a platform that has already been tested and produced should not be too expensive, allowing the new EBR to come forth with a very competitively priced machine.
In Germany the base price for the 2016 S1000XR is €15,200 ($16,610), while the R1200GS starts ar €14,700 ($16,060), with the TripleBlack going for €15,520 ($16,960), and the Adventure for €16,200 ($17,700). EBR's Gary Pietruszewski already told me that EBR was ready to sell their new-generation 1190 machines for as low as €15,000 ($16,390) in Europe, so the new EBRs could be on par with the local machines.
Incentives and other strategies could also draw more customers, and if the bikes prove to be reliable and the new owner of the brand can also establish a decent dealer/service network, Europe might become the new El Dorado for EBR.
Of course, these are only speculations, but for guys with money who want to invest in the motorcycle world, the EBR auction represents an opportunity to claw a business that's almost ready to roll. And thinking about adding smaller- displacement bikes to the game will allow EBR to penetrate markets that, until now, were a definitive no-no.
Selling smaller, cheaper bikes in larger numbers will yield a better margin for the new owner, and this might put EBR, or whatever name the company might receive, back to a floating position quicker.
The most important thing in all this is that EBR is still in one piece. I cannot rule out those who are maybe waiting for things to go from bad to worse so that the administrator of the receivership to split EBR in more lots and go for the intellectual property, or the name, or other whatnot.
We still have a fortnight until the auction, and it will be interesting to see if, and who steps up to buy Erik Buell Racing.
Motorcycles in stock, spare parts, engines, intellectual property and pretty much all there was under EBR's roof, so to speak. From a technical point of view, if a guy steps in and buys EBR, he or she could restart the production right away.
Or, for what's worth, use pretty much any of EBR's assets to start developing a new machine. We know that Erik Buell Racing has already done development work for Hero Motocorp in the small-to-middleweight segment. At EICMA 2014 EBR officials also confirmed for us that the company was envisaging expanding the line-up with smaller displacement bikes and was also eyeing delivering a sport-adventure machine. Even cruisers were part of the discussion, though they were more of a "we don't dismiss the idea of building a cruiser" thing.
All in all, this means that EBR might have already made certain steps in the development of new bikes. Now, it's been several years since the customers have become more interested in smaller bikes because of their better fuel efficiency, lower maintenance costs and, of course, lower prices.
Whoever decides to buy EBR, if anyone at all, could take profit from this direction. Some say that such a scenario might look a tad too radical, but given how EBR performed (or should I say, didn't perform) in the last years, it only looks like a "extreme conditions demand extreme responses" thing.
Building the AX bike might be a lucrative start
It goes without saying, the sport-adventure segment is the fastest-growing thing these years. Ducati, KTM and BMW took an early start and seem to have a slight advantage, but there is so much room for development that calling it a day is unthinkable.MV Agusta is also stepping into the game and we are still expecting moves from Yamaha and even Honda, despite the rather high inertia the latter seems to struggle with.
BMW showed how things are done as they took the S1000RR engine, down-tuned it a bit to make it less savage and more manageable, loaded it into a chassis that is more suitable for traveling, equipped it with smoother suspensions and voila! The S1000XR arrived to change the whole game, and it looks like BMW delivered what a whole lot of people were dreaming about.
EBR had plans to deliver a sport-adventure machine in the guise of the 1190AX. I got this from the very source and I also know that it was regarded as being the potential boost EBR needed.
With all the sporting heritage that comes with Erik Buell's name, such a motorcycle could represent an interesting move towards making EBR a profitable company once more.
Ulysses MKII anyone?
The not-that-old Ulysses was a bike people seemed to enjoy thoroughly. In fact, it anticipated the sport-adventure thing. A good platform for traveling packing plenty of nerve for fast, sporty highway hauls, capable of carrying rider and passenger AND their luggage, a potential bike such as a new Ulysses (MKII being an optional moniker) could nail things.Working on tweaking a platform that has already been tested and produced should not be too expensive, allowing the new EBR to come forth with a very competitively priced machine.
In Germany the base price for the 2016 S1000XR is €15,200 ($16,610), while the R1200GS starts ar €14,700 ($16,060), with the TripleBlack going for €15,520 ($16,960), and the Adventure for €16,200 ($17,700). EBR's Gary Pietruszewski already told me that EBR was ready to sell their new-generation 1190 machines for as low as €15,000 ($16,390) in Europe, so the new EBRs could be on par with the local machines.
Incentives and other strategies could also draw more customers, and if the bikes prove to be reliable and the new owner of the brand can also establish a decent dealer/service network, Europe might become the new El Dorado for EBR.
Of course, these are only speculations, but for guys with money who want to invest in the motorcycle world, the EBR auction represents an opportunity to claw a business that's almost ready to roll. And thinking about adding smaller- displacement bikes to the game will allow EBR to penetrate markets that, until now, were a definitive no-no.
Selling smaller, cheaper bikes in larger numbers will yield a better margin for the new owner, and this might put EBR, or whatever name the company might receive, back to a floating position quicker.
The most important thing in all this is that EBR is still in one piece. I cannot rule out those who are maybe waiting for things to go from bad to worse so that the administrator of the receivership to split EBR in more lots and go for the intellectual property, or the name, or other whatnot.
We still have a fortnight until the auction, and it will be interesting to see if, and who steps up to buy Erik Buell Racing.
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