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MoCo The Good, The Bad, and The Ugly.

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  #1  
Old 01-23-2012, 09:14 AM
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H-D Paying Dealerships to Close

from Cyril Huze Blog
Harley-Davidson Program To Reduce The Number Of Its U.S. Dealers. Over the past several years, the economic recession has resulted in slow new bikes sales and in pushing many now unprofitable US dealers in or close to bankruptcy. The traditional option is of course to sell and to reopen with a new owner, which is not necessarily what the Milwaukee company wishes in many areas of the country.

As a matter of fact, Harley-Davidson’s President openly declared his intention to continue to shrink the US dealers network, a way to protect the value of the brand and models, keeping a representation only through very profitable dealers. Practically, if your dealership is somewhat in trouble and H-D Milwaukee doesn’t want it anymore in your locale, the company prefers to “help” you to close it definitively via its “Harley-Davidson Motor Company’s U.S. Dealer Consolidation Program.

I don’t have details about the financial arrangement and how it works, but some dealers seem to prefer this option than looking for a buyer. Most recent example is Harley-Davidson of St Augustine, Florida where co-owners Clark Vitulli and Allen Good have decided that the Harley Program help in closing was a better financial option than accepting offers made to buy their dealership. Part of the package offered by Harley seems to be to let you sell and liquidate your stock of Harley parts and merchandise (not motorcycles) during a couple of months after the dealership closure. Maybe a way for business owners to recover and prevent them to end their business while in deep red.
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Old 01-23-2012, 09:30 AM
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I'm surprised this move took so long. There are at least 8 dealers within a 50 mile radius of the house, and that's just too damn many. Nice for the consumer, bad business practice though.
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Old 01-23-2012, 11:19 AM
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Yep, there's 3 dealers within 50 miles of us, and another 10 in the 50 - 100 mile range.

I found out this weekend that Lynchburg HD closed it's doors at some point. Was thinking about stopping Saturday, but when Patti checked the miles, the internet said "permanently closed".
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Old 01-23-2012, 12:44 PM
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Old 01-23-2012, 01:09 PM
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Originally Posted by Backroad Mike View Post
Yep, there's 3 dealers within 50 miles of us, and another 10 in the 50 - 100 mile range.

I found out this weekend that Lynchburg HD closed it's doors at some point. Was thinking about stopping Saturday, but when Patti checked the miles, the internet said "permanently closed".
...wow...I think I have a shirt from that dealership...bummer.
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Old 01-23-2012, 01:11 PM
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It just makes good business sense. There's no reason in the world to have 12 dealers in the Baltimore-DC area. All they do is serve to undercut one another. Harley's trying to preserve its status as a premium brand, and in order to do so, it's got to keep its product exclusive. Hence the reason they cut production a few years ago, and hence the reason they're cutting dealerships now.

They took a lesson from the auto industry. An awful lot of car dealers got closed during the auto bailout, and I don't believe there was any negative impact to sales. You'd better bet that Harley noticed that.
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Old 01-23-2012, 01:38 PM
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unfortunately the good dealership on the island closed
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Old 01-23-2012, 04:52 PM
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Wonder what they were thinking 10 years ago opening a new one on every corner once a week like they were Starbucks. (insert sarcastic tone here)
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Old 01-23-2012, 04:55 PM
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Wonder what they were thinking 10 years ago opening a new one on every corner once a week like they were Starbucks. (insert sarcastic tone here)
Cashing in on all the franchise fees.
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Old 01-23-2012, 05:00 PM
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Cashing in on all the franchise fees.
That and the "if one is good, twenty is better" mentality.
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Old 01-23-2012, 05:30 PM
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There are 4 dealerships in the San Antonio metro area. I feel like that is too many but they all seem to be doing well. At least they are geographically diverse enough to be convenient to all parts of town. I'm guessing that we have a higher percentage of motorcycle riders here than most parts of the country. The year round riding season doesn't hurt....
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Old 01-23-2012, 06:21 PM
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between billy and skip, I am not liking the Texas attitude......I am looking at a big green blob on the radar as I type this....
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Old 01-23-2012, 06:39 PM
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There are 4 dealerships in the San Antonio metro area. I feel like that is too many but they all seem to be doing well. At least they are geographically diverse enough to be convenient to all parts of town. I'm guessing that we have a higher percentage of motorcycle riders here than most parts of the country. The year round riding season doesn't hurt....
We have 7 dealers in the DFW area, and they all seem to be doing well. I really wish the one in Bedford would close. They suck
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