The Pandemic’s Impact on Motorcycle Sales

Commuters in Some Parts of the World Turn to Motorcycles

Motorcycle sales are on the rise in China and in parts of Europe. In places where COVID-19 infections are down, offices are reopening and people are commuting again. However, many are steering clear of public transportation and turning to motorcycles as a cost-effective way to get to work while avoiding trains and busses where coronavirus infections could spread.

Motorcycle sales for the month of May in Germany, Austria, and the Netherlands were ahead of sales last May. In Europe as a whole, motorcycle sales were down by 10% as countries like Spain and the UK are still dealing with shutdowns. However, European car sales in May were down 52%, showing that many people who want to buy a vehicle for private transportation are opting for motorcycles instead of cars.

The US Market May be Different

The United States is a bit unique when it comes to the motorcycle market. The culture of car ownership is strong in the US and fewer people depend on public transportation for their daily commute. Americans tend to buy large motorcycles for leisure riding, rather than smaller motorbikes for commuting. A leisure motorcycle falls in the category of a luxury item—an expense people might forego during times of economic downturn.

Though Americans are not buying as many motorcycles as people in some other countries, they are flocking to buy bicycles. In March, when much of the country went on lockdown, sales of adult leisure bicycles went up 120% and sales of childrens’ bicycles rose 59%. Some of these sales likely came from people needing a new way to commute. The spike can also be linked to gyms closing and people needing a way to exercise and entertain themselves and their families during quarantine.

Stocks to Watch

Harley-Davidson (HOG) has seen its shares decline by 44% over the past year. Even before the pandemic, the company was struggling to appeal to younger generations as its core customer base ages. The recent economic downturn will make recovery even more challenging for the Milwaukee-based company.

Honda (HMC) could be a stock to watch as motorcycles gain popularity in parts of the world. The Japan-based company makes about 33% of the world’s motorcycles—a higher market share than any other automaker. Honda stock has fallen by 13% this year but could be poised to recover. Investors are also eying Niu Technologies (NIU), a Chinese company that makes electric motorcycles. The company’s stock has gone up 88% this year. As COVID-19 cases rise in some parts of the world and fall in others, transportation industries from airlines to motorcycle makers will be impacted.

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