Motorcycle Forums banner
1 - 1 of 1 Posts

·
Registered
Joined
·
143 Posts
Actually profit margin matters as much or more than # of bikes or sheer revenue. One of the things many Japanese car companies discovered in the '80s was that selling cars near or at the margin in order to gain a great deal of market share did not necessarily help long term solvency (there are numerous reasons why they might have committed to this practice, including guarantees of lifetime employment among other things). Why do you think so many Japanese auto manufacturers have looked for investment abroud to help keep them afloat (not a problem for Honda)? One of the reasons for the focus on the SUV is that it is a high margin vehicle. Kind of like cruisers. The investment for building a cruiser is lower than that for a high end sport bike. Cruisers also happen to sell better and make more money. If your revenue does not exceed your cost, you will have little to re-invest -- a problem neither Harley nor Honda have, though I am sure many disagree with how one or both companies choose to spend their money.



At the same time, sales volume also matters. I applaud Honda for retaking the crown.
 
1 - 1 of 1 Posts
Top