HD and MV

Of course the biggest news in the motorcycle industry is the purchase of MV Agusta and Cagiva by Harley Davidson. There had been a lot of speculation for the past weeks and it finally happed late last week. The move comes as a bit of a shock (to me anyway). Yes Harley has been looking for growth in other world markets, and yes there have been word that MV was up for sale (rumor was Volkswagen was at one time interested). But the two brands seem to have little in common. Harley as the maker of "old school" classic American iron, and MV/Cagiva makers of flashy sexy Italian machinery. On the other hand each have some common traits; they both make high dollar "passionate" motorcycles. Both have loads of brand equity and loyal customers. The biggest question is how the two (or three or four if you count all the brands) fit together.

It seems like the obvious reason Harley wanted MV/Cagiva is for a foothold in Europe where the Italian company has most of its dealerships. Another likely reason for the buy could be Cagiva's smaller less expensive models. Hopefully MV will benefit from Harley's deep pockets, although if Buell is any sign, growth will be slow. I'd like to see a return to Harley's Aermarcchi days. In the 1970's Harley had a line up of Italian singles as entry level bikes. Bringing in MV/Cagiva could help complete the Harley's model line up.

I think it would be far more interesting if Harley had gone after a different company. ATK for example. ATK is a US based off road motorcycle maker. The company uses innovative designs and Rotax engines. It seems to me this brand would have been a perfect fit with Harley's cruiser line-up and Buell's sports bikes. Another company that would make a good fit is Arctic Cat. Arctic Cat makes Snowmobiles and ATV's and is also based in the US. Either of these companies would add a lot of volume to Harley's operations and build their dealer network. But it should be interesting where this new US-Italian company is headed.