Report: Harley could have, should have sold Buell

[Brad1445]

That question keeps coming around in a simplistic manner.  
BUT AT WHAT COST??????
There are people on this bored that would have bought Buell,
I would of at a certain price.

No Doubt this sell and others were talked about but due to the dealer supply of two year old inventory any offer made by anybody would be far less than writing it off and stopping the supply certainly took the dealers off the hook.

[Snowbird]

That question keeps coming around in a simplistic manner.  
BUT AT WHAT COST??????
There are people on this bored that would have bought Buell,
I would of at a certain price.

No Doubt this sell and others were talked about but due to the dealer supply of two year old inventory any offer made by anybody would be far less than writing it off and stopping the supply certainly took the dealers off the hook.

...with your "pod" casts.  

And, it's "would have."

[discochris]

That question keeps coming around in a simplistic manner.  
BUT AT WHAT COST??????
There are people on this bored that would have bought Buell,
I would of at a certain price.

No Doubt this sell and others were talked about but due to the dealer supply of two year old inventory any offer made by anybody would be far less than writing it off and stopping the supply certainly took the dealers off the hook.

They paid $95 million for OMC's outboard business, so they'll spend money. They also honored warranties held by customers on existing OMC products prior to the purchase (which had to be expensive since it was warranty work that bankrupted OMC in the first place).

They have a massive existing dealer network with Evinrude, Sea Doo, Ski Doo, and Can Am, so from that aspect, supply chain, marketing, infrastructure etc. would already be in place.

Not saying Buell would have gone for that, but considering HD flushed over $100 million down the toilet to shut them down, that would have been $120 million saved, plus whatever the purchase price was.

[Brad1445]

...with your "pod" casts.  

And, it's "would have."

I have to stop drinking and posting.....

2:00am to boot.

[BCRider13]

They paid $95 million for OMC's outboard business, so they'll spend money. They also honored warranties held by customers on existing OMC products prior to the purchase (which had to be expensive since it was warranty work that bankrupted OMC in the first place).

They have a massive existing dealer network with Evinrude, Sea Doo, Ski Doo, and Can Am, so from that aspect, supply chain, marketing, infrastructure etc. would already be in place.

Not saying Buell would have gone for that, but considering HD flushed over $100 million down the toilet to shut them down, that would have been $120 million saved, plus whatever the purchase price was.

You need to check your history of this deal a little better.  Bombardier, Inc. purchased the Johnson and Evinrude assets at an auction in a joint bid with Genmar Corp., who took the boat portion of OMC, for a combined total of $95 million.  This was in 2001 and prior to BRP being spun off of Bombardier, Inc.  At the time this was a great deal for both companies as Bombardier, Inc. was able to add known brands to it's recreational line and had a ready buyer of the engines in Genmar.  As in interesting sidebar, Genmar sought bankruptcy protection in June of 2009.

There is a big difference in what took place with the purchase of the OMC assets and the purchase of Buell.  OMC was bankrupt and it's assets were sold at auction.  Bombardier, Inc. and Genmar Corp. were under no obligation to keep employee's of OMC nor were they obligated to honor warranties or supply parts.  Both companies did offer warranties for the 2000 and 2001 model years and Bombardier, Inc. also recalled and repaired some engines.  This was done to instill consumer confidence in the brands, which was a smart business move on their part.

If Buell were purchased, the cost of doing business would be significantly more then the purchase price because employee contracts would have to be transferred, warranties would be in full force and parts would have to be made available.  This means that the purchaser would have to sign agreements with HD for the production of the air cooled engines.  If the Buell business failed it would likely be the end of BRP and I don't think the owners would be willing to take that risk.  It would be easier and less expensive to design their own motorcycle and use the already known Can-Am brand.  Again, the Rotax built engine is a whole different thing and something that BRP would probably like to have.

[Brad1445]

......... It would be easier and less expensive to design their own motorcycle and use the already known Can-Am brand.  .....

BOOM goes the dynamite!
And they could pay some Italian guy to make it sexy.

[Snowbird]

I have to stop drinking and posting.....

2:00am to boot.

 

 

[discochris]

You need to check your history of this deal a little better.  Bombardier, Inc. purchased the Johnson and Evinrude assets at an auction in a joint bid with Genmar Corp., who took the boat portion of OMC, for a combined total of $95 million.  This was in 2001 and prior to BRP being spun off of Bombardier, Inc.  At the time this was a great deal for both companies as Bombardier, Inc. was able to add known brands to it's recreational line and had a ready buyer of the engines in Genmar.  As in interesting sidebar, Genmar sought bankruptcy protection in June of 2009.

There is a big difference in what took place with the purchase of the OMC assets and the purchase of Buell.  OMC was bankrupt and it's assets were sold at auction.  Bombardier, Inc. and Genmar Corp. were under no obligation to keep employee's of OMC nor were they obligated to honor warranties or supply parts.  Both companies did offer warranties for the 2000 and 2001 model years and Bombardier, Inc. also recalled and repaired some engines.  This was done to instill consumer confidence in the brands, which was a smart business move on their part.

If Buell were purchased, the cost of doing business would be significantly more then the purchase price because employee contracts would have to be transferred, warranties would be in full force and parts would have to be made available.  This means that the purchaser would have to sign agreements with HD for the production of the air cooled engines.  If the Buell business failed it would likely be the end of BRP and I don't think the owners would be willing to take that risk.  It would be easier and less expensive to design their own motorcycle and use the already known Can-Am brand.  Again, the Rotax built engine is a whole different thing and something that BRP would probably like to have.

You clearly do have more info than I do. I actually had a hard time finding detailed info on the deal, since it was nine years ago.

I did know Genmar was part of the deal (and since I live in MN, I'm very familiar with the bankruptcy) - didn't know the details.

If the reports are true though, I still think it would have been a good deal for all parties involved. HD wouldn't have had to eat the shutdown costs and would have received some payment, Buell might still exist, and BRP would have an existing line of bikes, using their own motors, to sell. The point with OMC, even if it was a bankruptcy sale, is that it shows a history of doing the right thing and resurrecting a damaged brand, and successfully. I don't know that they would have continued to sell the XB line, but I don't think it would have been a bad idea short-term, and HD would have made money on engine sales.

Clearly BRP could make their own bikes if they wanted (and it would probably be a better idea than building the Spyder), so why make an offer for a company that people here seem to think wasn't worth saving? Probably because they thought it was a good investment.