Oct. 5, 2009 – A diversity of product investment for KYMCO in 2010
October 5, 2009
Filed under Features
By Neil Pascale
ASHVILLE, N.C. — In some respects, KYMCO USA President Eric Bondy has been the kid in the front seat of the front car on the rollercoaster ride.
He had perhaps the best view of a glorious six-month stretch in 2008 where scooter sales skyrocketed to the point of retail bliss: Where demand far, far outpaced supply. He was right there as KYMCO, one of the more well-known scooter brands outside the metric OEMs, grew its dealer base by more than 150 dealers in just one year — a sizeable increase for a smaller OEM.
Bondy also was in that same front seat over the past six months as the rollercoaster ride suddenly shot down, down, down and retail sales fell industry-wide by more than 60 percent.
So during a break at KYMCO’s recent 2010 media lunch, Bondy answered a question about the company’s 2010 scooter forecast with the humor of somebody who has experienced first hand the craziness of the recent retail scooter market.
“You got a dart?” he asked, smiling.
Bondy’s humor withstanding, it’s clear the Taiwanese manufacturer sees some calming of the market in the year to come as it further broadened its scooter lineup with a retro-styled 50cc offering, the Like 50, and new high-displacement models, including the Like 200i.
“From everything I read and hear, we’re getting relatively close to the end of the recession,” Bondy said. “I think our industry is going to lag behind the recession recovery just because we’re not a necessity, we’re a luxury item. But I believe in my heart of hearts that as we get into the second quarter of next year that things will start to normalize.”
KYMCO is backing that belief by not only investing in the deeper scooter line, but also expanding its four-wheel selection. The company added a 350cc crossover quad that provides both sport and utility features as well as moved to become a bigger player in the UTV market.
KYMCO has used its aftermarket partnerships to provide a new accessory-packed UTV that it believes will sell for less than its competitors’ stock units. The new UXV 500 LE will include chrome alloy wheels, a winch, complete windshield and a full, soft cab enclosure. The objective: To have a side-by-side on the showroom floor that is instantly and visually different from its competitors. And that will be key as KYMCO at times has struggled to get multibrand dealers to put a second or even third UTV brand in a prime selling spot in their dealership.
“From a value proposition standpoint, we offer great value to the consumer, and I’m not focused on price here,” Bondy said of the company’s new limited edition UTV. “We have durability, we have ground clearance, handling, stability.
“We think we have some very nice advantages. It’s just a matter of getting more of them out there and getting more people to ride them.”
The UTV business, a very small part of KYMCO’s bottom line, figures to be a growth area for the company. For now, KYMCO is relying primarily on the scooter business, which makes up roughly two-thirds of its revenue, and ATVs. Bondy believes the company has made market share strides in each category this year.
KYMCO’s scooter sales are down in the low 40 percent area where the industry at large is down more than 60 percent, Bondy said.
The OEM also is performing better than the industry in ATV retail sales. Bondy said KYMCO is down in the mid single digits percentage-wise this year for quads — the industry has been down approximately 30 percent — although some of that is due to the OEM launching aggressive incentives to help dealers get rid of youth models earlier this year.
Bondy credits those market share gains to the brand’s dealers, which have collectively been more aggressive with their marketing co-op dollars in 2009 vs. a year ago. “The dealers, I think, have done a wonderful job of advertising, promoting and doing all the things they need to do to continue to retail,” he said.
KYMCO is seeking to help that effort by funding sales training in dealerships. It has worked with Dealership University in crafting online product courses as well as provide incentives for dealership staff to take sales training courses with the Glenn Roller Institute.
“We think it’s really critical in a time like this for dealers that the sales people on the floor are the best they can be,” Bondy said. “Their closing ratios are as high as they can be. They recognize buying signals. All the things you would do in sales training.”