Save this article, change Victory to Indian, repost in 5 years.
I'm a bit surprised that they didn't just merge Victory into Indian at the first chance they had. I can't see room in the market for both of them, especially as part of the same corporation.
Indians are actually selling pretty well, I think. It's too bad about the Victory, they are good bikes.
Compared to all the other startup motorcycle manufacturers that come and go, Polaris has had the engineering and financial backing to be able to come up with their own motorcycles that aren't just another Harley clone with an S&S engine.
In reply to pinchvalve:
I think 5 years is being generous. It seems preposterous to me that they thought there was a market large enough to hold more than one psuedo-antique looking stone aged $20-40k cruiser company, nevermind three. Although Indian would benefit here a little I think (which IIRC is also Polaris). People who choose Victory would pick Indian before HD by the nature of having been shopping an alternative in the 1st place. Maybe this is really more of a consolidation of the two brands?
Meanwhile the "normal" bike companies are delivering futuristic 180HP, 400lb machines with keyless start, integrated GPS nav, lean angle ABS and traction control, active suspension, clutchless shifting with queuing... in everything from traditional sport bikes to touring to ADV bikes for under $20k that are comfortable all day companions for actual riding. And pricing their less techie bikes even lower.
The value proposition for a fairly expensive, plain, semi-comfortable, low tech cruiser with excellent paint luster seems like it would be limited to a pretty low unit count annually that is mostly covered by the Motor Company. Basing an entire company on the scraps leftover from Harley Davidson and only that market seems foolish.
And... it looks like it actually was. THey were only 3% of Polaris total sales and lost money 3 out of the last 5 years according to the article.
Here's an article from today's Minneapolis newspaper about it. It's a little ironic that when they reintroduced the Indian bikes, the success of that brand probably led to the demise of the Victory brand.
Polaris Industries will exit the Victory Motorcycle brand it started from scratch 18 years ago, citing a mix of competitive pressures and lack of market share.
The Medina-based company's announcement Monday will not affect Polaris' fast growing Indian Motorcycle brand or other divisions, officials said. CEO Scott Wine said the "winding down" of the Victory brand will begin immediately.
"Victory has struggled to establish the market share needed to succeed and be profitable. The competitive pressures of a challenging motorcycle market have increased the headwinds for the brand," Wine said in a statement.
Victory's share of the motorcycle market slid to just 2 percent last year, from 3 percent in 2013. Wine said the company decided to focus on the Indian brand given its strong performance and growth potential and the significant additional investments that would be necessary for Victory to succeed.
Polaris will help dealers liquidate existing Victory inventory and will continue to supply parts and service for 10 years and honor warranty coverage accordingly.
Polaris said it "remains committed to maintaining its presence" in the Spirit Lake, Iowa, facility where Victory and Indian bikes are now made. It also remains committed to its new Huntsville, Ala., plant which makes the three-wheeler Slingshot motorcycle, among other products.
It is unclear how employment at the plants might be affected as Victory winds down.
Dealers are taking the news as best they can. "We sunk a lot of money into this and so we are sad to see it go," said Jamie Kurkowski, assistant sales manager at Mies Outland in Watkins, the largest Polaris dealer in the state.
"We had years where we sold 150 Victorys a year," Kurkowski said. "Lately it was about 75 and 100 Victorys a year. But what are you going to do? It sounds to me that it was a profit margin problem."
While Polaris directed a lot of energy in recent years at buying and relaunching the Indian Motorcycle brand, the launch of the Victory bike came first and represented a bold attempt at product diversification.
When the first Victory Motorcycle roared off the assembly line in Spirit Lake in 1998, it broadened Polaris' product line beyond snowmobiles, four-wheel all-terrain vehicles and personal watercraft. Since then, Polaris has designed and produced nearly 60 Victory models that won 25 industry awards.
The experience, knowledge and infrastructure gained in launching Victory gave company officials the confidence to acquire and develop the Indian Motorcycle brand, Wine said. "So I would like to express my gratitude to everyone associated with Victory Motorcycles and celebrate your many contributions."
For the first nine months of 2016, Victory and Indian motorcycles sales were about $603 million. That's up from roughly $192 million for the first nine months of 2012, when the bulk of sales reported in that category represented Victory motorcycles.
Motorcycles now represent about 15 percent of Polaris' annual revenue of $4.7 billion.
Polaris' stock fell 3.3 percent to close at $83.72 a share Monday. It's trading at nearly half the value enjoyed in February 2015.
The decision to shut down the Victory line did not surprise Wall Street analysts. The end of Victory is just "as some in the industry had conjectured since the launch of Indian," said UBS analyst Robin Farley.
"Sales of Victory had peaked in 2012 before the introduction of Indian in 2013. And Victory had declined each year after that, with the business being unprofitable … for three of the last five years," she said. "We expect this to be neutral to positive" for Polaris' earnings outlook."
The product change comes at a tough time for Polaris, which has battled a downturn in the recreational sports industry and massive recalls of its four-wheel ATVs and Indian Motorcycles due to the potential risk of fire. Research, repairs, warranty, legal and other costs associated with the recalls have cost Polaris more than $120 million to date.
The company is expected to reveal costs for the Victory brand shutdown next week, when it reports fourth-quarter earnings.
I wonder why they didn't just announce it as a merge with Indian. You know some of that staff and parts bin are just moving down the hall unless they can sell it.
In reply to Huckleberry:
That's sort of what I was getting at in my earlier post, since Indian has so much more cachet and brand recognition then Victory could ever hope to have. This may also be a lost opportunity to make Victory into a non old fat guy cruiser brand.
I really liked Buell, and would have bought one back in the late nineties if not for HD dealers trying thier hardest to not sell me one. I think a brand like that has a place in the market, more so than another cruiser brand, and could be a success if sold by people who actually wanted to sell them. I believe that Polaris has the technical know how to build a product that scratches that itch.
I got all excited when Victory built a bike for racing at Pikes Peak (it was called Project 156, you can find out a bunch more online) but I guess that's dead now. It would have been nice to see something other than a cruiser bike offered to the public.
I was surprised that Indian didn't become a line of bikes under the Victory umbrella, kind of like Lincoln in the Ford family. I personally don't see much market for an American cruiser that isn't an H-D. If someone wanted that, wouldn't they just buy something from Asia?
pres589 wrote: I personally don't see much market for an American cruiser that isn't an H-D. If someone wanted that, wouldn't they just buy something from Asia?
A lot of people who want to buy a cruiser bike also want to buy American built goods. Also, Polaris already has a pretty good size customer base from their snowmobiles and ATVs, so they want to sell those people something they can ride on the street.
I had hoped Polaris would try to get into the American sport/standard game. Like buell, but with a more modern engines.
How well did selling sport standards and sport bikes turn out for Buell? The man or the brand?
I do disagree with Pinchvalve on the imminent demise of Indian, at least from a riding perspective. The bikes are good, and anyone who will take a test ride of either domestic brand will have a hard time deciding. The Scout and the Sportster are good competition for each other, and the Chief is a sublime bike to ride. Sure, a $6000 FZ-07 runs circles around either one on a race track or twisty back road, but it's not half as cool.
In reply to skierd:
A big part of Buell's problem was that very few H-D dealers actually acted like they wanted to sell them, and steered potential customers toward traditional H-D products, or back out the front door. Buying one was hard work.
My guess is Victory was operating at a loss and "folding" the brand was more profitable for Polaris than rolling that companies losses into the profits of Indian. They are going to carry over what they want to keep to Indian but Indian will "buy" those elements as part of the asset selloff of Victory.
From what I see, with Victory you got a large, cumbersome semi-custom bike designed by Arlen Ness. Apparently not many wanted that. Although neat, just didn't care for the look myself. Now Indian I do like. An American brand that will give cruiser style and not be a Harley. Most of the Harley guys I know don't like Indian because it isn't a Harley. I think that is in its favor. I like the Scout, seems to fit between the Harley Sportster and the bigger Harleys. Hope Indian makes it. Maybe roll a couple of the favorite Victory's into Indian to round off styling. I prefer cruiser riding style to sport myself. If I want to go fast I'll drive a sports car. Oh wait, I do drive a sports car.
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