Daredevil Evel Knievel dead at 69

CLEARWATER, Fla. (AP) — Evel Knievel is dead.

That sentence probably should have been written in 1968, when Knievel crashed his motorcycle spectacularly as he jumped the fountains at Caesar’s Palace in Las Vegas and wound up in a coma.

It probably should have been written in 1974, when his rocket-powered cycle failed as he tried to jump the Snake River Canyon and he almost landed in the raging water. Or the numerous other times when, while trying to jump something bigger than ever, he splattered.

Instead, it was written Friday. Natural causes. Age 69.

“It’s been coming for years, but you just don’t expect it. Superman just doesn’t die, right?” said longtime friend and promoter Billy Rundel. He’s the organizer of the annual Evel Knievel Days festival in the daredevil’s Butte, Mont., hometown. “I lost a good friend and a guy who was like a father to me. I’m just glad he doesn’t have to suffer anymore.”

Rundel said Knievel had trouble breathing at his Clearwater condominium Friday and died before an ambulance could get him to a hospital. Knievel had been in failing health for years, suffering from diabetes and idiopathic pulmonary fibrosis, an incurable condition that scarred his lungs. He had undergone a liver transplant in 1999 after nearly dying of hepatitis C, likely contracted through a blood transfusion after one of his many spills.

Knievel’s son, Kelly, 47, said he had visited his father in Clearwater for Thanksgiving.

“I think he lived 20 years longer than most people would have,” Kelly Knievel said. “I think he willed himself into an extra five or six years.”

Immortalized in the Washington’s Smithsonian Institution as “America’s Legendary Daredevil,” Knievel suffered nearly 40 broken bones before he retired in 1980.

For the tall, thin daredevil, the limelight was always comfortable, the gab glib. Always, he welcomed the challenge whether in sports, at work or play. To Knievel, there always were mountains to climb, feats to conquer.

“No king or prince has lived a better life,” he said in a May 2006 interview with The Associated Press. “You’re looking at a guy who’s really done it all. And there are things I wish I had done better, not only for me but for the ones I loved.”

He garbed himself in red, white and blue and had a knack for outrageous yarns: “Made $60 million, spent 61. …Lost $250,000 at blackjack once. … Had $3 million in the bank, though.”

Although he dropped off the pop culture radar in the ’80s, Knievel always had fans and enjoyed a resurgence in popularity in recent years. His death came just two days after it was announced that he and rapper Kanye West had settled a federal lawsuit over the use of Knievel’s trademarked image in a popular West music video.

In later years he still made a good living selling his autographs and endorsing products. Thousands came to Butte every year as his legend was celebrated during Evel Knievel Days.

“They started out watching me bust my ass, and I became part of their lives,” Knievel said. “People wanted to associate with a winner, not a loser. They wanted to associate with someone who kept trying to be a winner.”

He began his daredevil career in 1965 when he formed a troupe called Evel Knievel’s Motorcycle Daredevils, a touring show in which he performed stunts such as riding through fire walls, jumping over live rattlesnakes and mountain lions and being towed at 200 mph behind dragster race cars.

 
Evel Knievel died of natural causes Friday after 69 years, which is probably twice as long as it should have taken him.
AP
 
In 1966 he began touring alone, barnstorming the Western states and doing everything from driving the trucks, erecting the ramps and promoting the shows. In the beginning he charged $500 for a jump over two cars parked between ramps.

He steadily increased the length of the jumps until, on New Year’s Day 1968, he was nearly killed when he jumped 151 feet across the fountains in front of Caesar’s Palace. He cleared the fountains but the crash landing put him in the hospital in a coma for a month.

His son, Robbie Knievel, followed in his father’s daredevil footsteps and successfully completed the same jump in April 1989.

In the years after the Caesar’s crash, the fee for the elder Knievel’s performances increased to $1 million for his jump over 13 buses at Wembley Stadium in London — the crash landing broke his pelvis — to more than $6 million for the Sept. 8, 1974, attempt to clear the Snake River Canyon in Idaho in a rocket-powered “Skycycle.” The money came from ticket sales, paid sponsors and ABC’s “Wide World of Sports.”

The parachute malfunctioned and deployed after takeoff. Strong winds blew the cycle into the canyon, landing him perilously close to the water.

On Oct. 25, 1975, he jumped 14 Greyhound buses at Kings Island in Ohio.

Knievel decided to retire after a jump in the winter of 1976 in which he was again seriously injured. He suffered a concussion and broke both arms in an attempt to jump a tank full of live sharks in the Chicago Amphitheater. He continued to do smaller exhibitions around the country with Robbie, who did his best to imitate his dad.

Robbie Knievel jumped a moving locomotive in a 200-foot, ramp-to-ramp motorcycle stunt on live television in 2000. He also jumped a 200-foot-wide chasm of the Grand Canyon. His cell phone voicemail was full and he could not be reached for comment Friday.

Evel Knievel also dabbled in movies and TV, starring as himself in Viva Knievel and with Lindsey Wagner in an episode of the 1970s TV series Bionic Woman. George Hamilton and Sam Elliott each played Knievel in movies about his life.

Evel Knievel toys accounted for more than $300 million in sales for Ideal and other companies in the 1970s and ’80s.

Born Robert Craig Knievel in the copper mining town of Butte on Oct. 17, 1938, Knievel was raised by his grandparents. He traced his career choice back to the time he saw Joey Chitwood’s Auto Daredevil Show at age 8.

Outstanding in track and field, ski jumping and ice hockey at Butte High School, he went on to win the Northern Rocky Mountain Ski Association Class A Men’s ski jumping championship in 1957 and played with the Charlotte Clippers of the Eastern Hockey League in 1959.

He also formed the Butte Bombers semiprofessional hockey team, acting as owner, manager, coach and player.

Knievel also worked in the Montana copper mines, served in the U.S. Army, ran his own hunting guide service, sold insurance and ran Honda motorcycle dealerships. As a motorcycle dealer, he drummed up business by offering $100 off the price of a motorcycle to customers who could beat him at arm wrestling.

U.S. Rep. Pat Williams, D-Mont., grew up with Knievel in Butte.

“The phrase one-of-a-kind is often used, but it probably applies best to Bobby Knievel,” Williams said Friday. “He was an amazing athlete…He was sharp as a tack, one of the smartest people I’ve ever known and finally, as the world knows, no one had more guts than Bobby. He was simply unafraid of anything.”

At various times and in different interviews, Knievel claimed to have been a swindler, a card thief, a safe cracker, a holdup man. Last April, Knievel announced that he had given up his sinful ways and was baptized during the Rev. Robert H. Schuller’s “Hour of Power” service at the Crystal Cathedral in Garden Grove, Calif.

Knievel married hometown girlfriend, Linda Joan Bork, in 1959. They separated in the early 1990s. They had four children, Kelly, Robbie, Tracey and Alicia.

Knievel lived with his longtime partner, Krystal Kennedy-Knievel, splitting his time between their Clearwater condo and Butte. They married in 1999 and divorced a few years later but remained together. Knievel had 10 grandchildren and a great-grandchild.

A funeral service is planned for 11 a.m. Dec. 10 at the 7,500-seat Butte Civic Center in Montana.

Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Source Sports Illustrated

Two-Wheeled Ego Boosters

Thursday, Nov. 29, 2007
Two-Wheeled Ego Boosters
By Catherine Sharick

Movie stars, CEOs and pro athletes are easy to spot in their Aston Martins, Mercedes or Bentleys. But some high rollers prefer the feel of wind in their face on just two wheels–but not just any two wheels. Bypassing their local Harley-Davidson dealers, they instead seek out bespoke limited-edition luxury motorcycles.

“Whatever a customer wants, we provide,” says Roger Bourget, CEO of Bourget’s Bike Works in Phoenix. “We build egos for guys.” Bourget and other motorcycle craftsmen tailor bikes like fine suits. For speed demons, that might mean top suspension and a light chassis. For touring long distances, the custom biker will ask for an intercom system and heated seats and handlebars. Just cruising? He can do that on a chopper or a bagger with a hand-painted body and intricately detailed metalwork. The American artist Michael Godard ordered an $85,000 gangster-themed chopper with images from his collections painted onto the rear fender and bike body and sculpted revolvers adorning the spokes. “Bourget’s builds rolling eye candy,” says Arthur Coldwells, editor and publisher of Robb Report MotorCycling. “These are gorgeously detailed motorcycles you ride to be seen.”

Demand for limited-edition bikes has never been greater–the supply of wealthy middle-aged guys with too much time and money is growing–and the industry is expected to bust through $100 million in sales this year. “Our business has more than tripled over the past three years,” says Wendy Atchison, CEO of Ecosse, a boutique cyclemaker in Denver. Its $275,000 Titanium Series RR is handcrafted by welders, machinists, painters and upholsters. The bike’s all-titanium chassis is stronger than and a tenth the weight of steel, very difficult to weld and brutally expensive. For those hours off the bike, owners can still keep their babies close: included with the Titanium Series RR is a $20,000 skeletal-faced watch that matches the bike’s exposed engine.

For those who already have all the toys they want, even a work of art like the bike isn’t enough; they want the experience of building the bike of their dreams. So Ecosse offers–for $3.6 million–the Ecosse Spirit ES1, a package of two high-performance bikes, plus the chance to help build them with Formula 1 engineers and two weeks or more of training with championship-level racers. “Most guys who are into motorcycles are interested in the mechanical workings of the engine–getting the chance to work with a team of builders will be incredible,” says Coldwells.

Part of the lure of one of these cycles is that very few people will have anything like it. A motorcycle from a custom shop is available in limited quantities. Only 100 Ecosse Heretics have been offered, and production on the Titanium Series RR is capped at 10. “We will continue to produce low numbers despite the wait list,” says Atchison. “Once a model or series is complete, a new limited-edition run will take its place.”

Italy’s Ducati, which leads the pack in the sport and performance category, will cap production on its $72,500 Desmosedici RR at 1,500. Equipped with a 200-h.p. engine and weighing less than 370 lbs. (168 kg), the Desmosedici RR is one of the fastest street bikes on the planet. “Celebrities like motorcycles because they can go out for a ride with a helmet on and no one knows who they are,” says Coldwells. It certainly would be easier to escape the paparazzi on one. Jay Leno and Tim Allen both have Ducatis, and Tom Cruise and Nicolas Cage are owners of Ecosses.

Bourget’s Bike Works produces fewer than 600 motorcycles a year, and some collectors can’t get enough. Enthusiast Mark Meeberg owns 18 custom-made Bourget’s, and his collection is valued at more than $1 million. Meeberg, who made his fortune as the owner of a commercial reconstruction business, speaks of the “freedom” he feels while riding. On his $135,000 Cobra, every piece of metal is streamlined to the machine so there is not a straight line on the bike, and that union of form and function takes his mind off everything else. “I have a real high-stress business, but when I get the chance to get on a bike for 15 minutes, to smell the fresh air and see the horizon, all is better.”

• Find this article at:
• http://www.time.com/time/magazine/article/0,9171,1689218,00.html

S&S ANNOUNCES CCI REPRESENTATIVE TRAINING

 

LA CROSSE, WI (November 29, 2007) S&S® Cycle Inc. announces that CCI (Custom Chrome Incorporated) sales representatives have completed the S&S Distributor Training Course.

The S&S Distributor Training Course is designed to equip distributor representatives with important knowledge about Proven Performance® S&S components and engines.  This is part of the ongoing effort by S&S to ensure the best possible service and advice to end users of S&S performance equipment.  This course provides expert instruction to the attendees, helping them communicate the benefits of S&S products to their dealers.

S&S Sales Manager Kurt Peterson went to the CCI headquarters, located in Morgan Hill, California, and spent two days working with the CCI team. Aside from learning about the new S&S parts coming out, heavy discussions about emissions and, specifically the line of S&S EPA Certified Engines, took place.
 
“Both Holger Mohr and Frank Esposito attended training and were grateful for having me there,” said Kurt Peterson, S&S Sales Manager.  “They now see the importance of looking at the bigger picture when it comes to S&S components and their important role in a market that is not currently producing large volumes of complete engine sales.  I left there feeling more confident in their ability to dig deeper and work on ways to better communicate with their customers.”

At the end of the training, each attending representative is given two weeks to take and pass all four of the S&S Distance Learning courses to achieve their training validation. S&S offers expert training to their customer base, including dealers and distributors, as well as consumer training for v-twin enthusiasts.  S&S Dealers must pass a series of tests and attend training at the S&S facility to be certified at various levels.  Consumers can visit www.sscycle.com and click on ‘Find a Dealer’ to locate an authorized dealer.  The dealer locator will also display S&S dealers who are associated with CCI.

S&S Cycle has been a leading manufacturer of Proven Performance v-twin motorcycle components and engines for nearly 50 years. George Smith and Stanley Stankos founded the company in 1958 in Blue Island, Illinois. Shortly after the founding of S&S, George, and his wife Marjorie (whose maiden name was also Smith), bought out Stanley Stankos and Smith & Stankos became Smith & Smith (S&S). In 1969, S&S moved from Blue Island to Viola, Wisconsin and expanded to La Crosse, Wisconsin in 2004. This 3rd generation business supplies components and/or engines to several large custom OEs including: American Ironhorse, APC, Arlen Ness, Big Bear Choppers, Big Dog, Bourget Bike Works, Orange County Choppers, Saxon, Swift, & Victory (please see the S&S website for a complete listing located at www.sscycle.com
 

Copyright 2007 - S&S Cycle, Inc.

Choppahead Vol. 1 has arrived!

It’s always great to hear from Scott and Zack over at One World Studios. Here’s what they’ve been cooking up lately.

>>>>>>>>>>>>>>>>>>>>>>>>>

Choppahead Vol. 1 has arrived!
 
Hey Guys!

Just a quick note to let you know that Big Truth sent us a couple boxes of the reprinted Choppahead Vol. 1 DVD so if you have a chance please head over to the store and check it out!  We also put together some new COMBO Deals for Christmas.

CLICK HERE TO CHECK IT OUT!

We’re still editing Brittown, looks to be ready in January.  It’s taken a long time and we want to make it perfect.  Thanks for being so patient, your emails of encouragement keep us going.  Can’t wait to  hear what everyone thinks!

Choppahead Vol. 1 is back again!
Reprinted due to popular demand, Truth sent us a couple boxes of his first Choppahead Vol. 1 DVD.  Please support and pick one up for Christmas in one of our DVD Combos!

CHECK IT OUT AT: CHOPPERTOWN.NET/STORE

We couldn’t survive without you guys.  Please contact us if there’s ever any thoughts you’d like to share.  Thanks as always.

 

Stay independent,

 

Zack and Scott
One World Studios Ltd.

www.brittown.com
www.choppertown.com

 
 

Jay Barbieri and Friends To Host Booksigning for Biker’s Handbook in L.A. This Saturday

Jay Barbieri is promoting his new book Biker’s Handbook. The book is geared toward the beginner to novice rider. Okay — maybe intermediate, too.

We received a generous invitation to attend this event. Ufortunately, we will not be able to make it this time. For those of you out on the left coast we’re sure it will be a great time! Here’s a copy of the invitation.

For those of you who will not be attending the event, you can always pick up a copy at Amazon. com. This one won’t be signed of course…

AIH updates Texas Chopper for ‘08

Source AMD ‘e-Club’ #0429

WIDELY credited with “making Chopper styling available to the masses”, 2008 will see American IronHorse introduce the most extensive re-design of its top-selling Texas Chopper model since the bike first appeared.Taking the 300 fat rear end of its Slammer model as a start point, VP New Product Development Jeff Long has come up with a new design that he says “brings a more contemporary look and feel to  the bike. The overall effect is of a very smooth, more curvy design, with ultra-clean lines in which every area of the bike flows naturally from and into the next. We are very happy with what we have achieved and feel sure our dealers and their customers will love the new Texas Chopper”.

Featuring a heavy gauge, arced single front downtube with 8 inches of stretch, 4 inches of stretch in the top tube and 42 degrees of rake, thanks to an additional 4 degrees created by crested triple trees, the curved look is repeated in an all new gas tank design.

“We have retained the patented fuel delivery system from the old tank design, but whereas that was a super-straight look, the new tank is much more curved, and that repeats into the drop seat and the stretched out and arced swingarm.

“Having the belt outside, and with the better crown that the 300 tire has, the ridability of the bike is fantastic and is a very nimble feeling ride. It feels much more like a 240 or even a 200,” Long said.

The engine is the carbureted S&S 111 inch Sidewinder Plus. The rear wheel is an 18 incher, the 2:1 exhaust has integral heat shields, the 6-speed close ratio RSD transmission gets a chromed hydraulic “easy pull” clutch, and the company says that they offer “limitless paint designs, 18 base colors and three wheel styles” among the selection of customer options.

http://www.americanironhorse.com
The ‘08 Texas Chopper features re-styled gas tank, arced single front downtube, drop seat, curvy swingarm and a 300 rear end
(click image to enlarge)

Best regards,

Robbie Patterson
AMD ‘e-Club’ Supervisor
robbie@dealer-world.com
 

We were at Mt. Rushmore and Sturgis

Hey,

  That is an interesting article.We went to Mt. Rushmore during Sturgis Bike Week. Well, we were almost there.

  You can ride your bike,drive a car or, you can take an old classic train.Me and Train decided to ride the rails.The locomotive that goes up to Rushmore is cool. It is an old train that winds it’s way through the mountains. The trip takes about 45 minutes.We chose to go this way because it seemed like a better way to see the scenery, take some photos, relax and just enjoy the experience. We knew there would be plenty of motorcycles to see and ride so,the train It was. The ride was fun and when we got to Mt. Rushmore we decided to get off and go see the wonder up close and personal. Well, as I said the train was old and you got off by stepping down some portable stairs which were very tall, very steep, and yes, down I went.I missed a step and landed with my left leg twisted behind my body my face on a slab of concrete and a number of cuts and bruises. I thought I tore something in my knee but miraculously it turned out to be a sprain. I lost a lot of skin and I had trouble walking but, I was better in a day or so. Train couldn’t believe it nor could the conductor or anyone else. I couldn’t believe it either.Train got me some help and took over. She found me some first aid and I hobbled back on the iron horse for the return. We never really got to see Mt. Rushmore up close but we did have quite an experience.We will take the bike in 2008.

  I am recounting this experience because the previous article reminded me. I also wanted to say that there were a lot of folks on that train and it kept going up and down that mountain. No one was counting these people so, if a record was set, it was a lot more than the motorcycle counters counted.We’re bikers!! We just took the train

                                                                    Beach

Count: Bikers visited Rushmore in record numbers

By Steve Miller, Journal staff

A record number of motorcycles rolled into Mount Rushmore National Memorial during the Sturgis motorcycle rally, a feat that one Rushmore official even finds a little hard to believe.

Rushmore workers counted 104,861 motorcycles coming into the memorial over an 11-day period surrounding the rally, up 27 percent from 82,388 in 2006 and the previous record of 82,466 bikes in 2005, according to Rushmore chief ranger Mike Pflaum.

Pflaum said the record number this year surprised and puzzled him. “It’s a big jump.”

Mount Rushmore has people who physically count the number of motorcycles coming into the memorial, but Pflaum said the high figure this year has him scratching his head.

“Am I certain about the numbers? No. These numbers are done with human counts,” he said. “There’s always room for error.”

However, he said, if the counters made an error, he doesn’t know how.

Many longtime rally observers thought motorcycle traffic this year, especially in the Sturgis area, was down from 2006, which, in turn, was down from 2005.

However, the state Department of Transportation’s pneumatic traffic counters at all of the main roads into Sturgis showed a 2.7 percent increase in traffic over 2006.

State sales-tax figures for temporary rally vendors showed a 4 percent drop for Sturgis and the Northern Hills but a 21 percent increase for rally vendors in the Southern Hills, a figure more in line with the jump in Rushmore visitation during the rally.

In any case, Pflaum said, the motorcycle count at Rushmore this year indicates that numbers were up. “They may be right,” Pflaum said about the count at Rushmore this year. “We realize there has been a lot more activity in the southern and central hills.”

Rushmore has always been a popular destination for bikers visiting the Black Hills during the rally.

Pflaum said Rushmore uses an equation of 1.45 riders per motorcycle, based on surveys done at the memorial several years ago. That would mean more than 150,000 riders visited the memorial during the rally.

Contact Steve Miller at 394-8417 or steve.miller@rapidcityjournal.com

Bound for Hog Heaven

Bound for Hog Heaven
By VITO J. RACANELLI

WHEN IT COMES TO BRAND POWER, HARLEY-DAVIDSON punches above its weight. The maker of heavyweight motorcycles has a market capitalization of less than $12 billion, but the name recognition of companies many times its size. For the past seven years, Harley has finished in the top half of consultant Interbrand’s annual survey of the 100 best global consumer brands, in a league with giants such as Coca-Cola and Walt Disney. Its brand cachet, together with the quality of its products, has helped the Milwaukee-based company establish a lengthy track record of double-digit earnings gains and strong stock-market returns.

These days, however, Wall Street is giving Harley the kind of respect a motor scooter rider would get at a biker bar. The growth in U.S. bike sales has slowed, and increasing anxiety about a potential domestic recession has sunk the stock (ticker: HOG), along with many other consumer-discretionary shares. Harley has fallen nearly 40% in the past 12 months, to around 46, from a high of 75.50. Its shares now trade at levels first reached in the summer of 2000, ahead of an economic recession, when Harley was producing just 60% as many bikes as it does now. The stock currently sports a price/earnings multiple of 12 times next year’s expected earnings, well below the historic norm.

Recession fears have pounded Harley’s stock. After all, a Fat Boy isn’t an essential purchase.

Yet when the Street throws in the towel on Harley-Davidson — as it seems to do every few years — that is usually the best time to buy the shares. Harley has fallen 30% to 40% ahead of previous U.S. recessions, only to rebound when the economy perks up. This time, the stock could top 60, although that is unlikely to happen tomorrow, or the day after.

THE NEXT 12 MONTHS AREN’T going to be easy for Harley, which announced in September that it expects a modest dip in 2007 revenue, and a 4% to 6% decline in earnings per share, to $3.69 to $3.77. Last year the company netted $1.04 billion, or $3.93 a share, on sales of $5.8 billion. Harley also said that it sees a “challenging” environment in 2008, with moderate revenue gains, lower operating margins and growth in earnings per share of 4% to 7%.

 

The company’s reduced guidance and the market’s broader fears are reflected in Wall Street analysts’ ambivalence about the stock. Only five of 21 brokerage analysts now rate the stock a Buy, according to Bloomberg, while the rest are neutral. The bear case for Harley rests mainly on concerns that next year’s bike demand will drop because of the nation’s deteriorating housing market, diminished consumer confidence, high gasoline prices and tighter lending practices. At an average price of $13,000 to $14,000 per bike — or $17,000 for a Harley Fat Boy — the company’s products, says H. Edward Shill, chief investment officer at QCI Asset Management in Pittsford, N.Y., are “about as discretionary as it gets.” QCI owns about 190,000 Harley shares.

“We’re going to see some fallout in the marketplace,” says Gaylen Brotherson, CEO of the National Motorcycle Dealers Association, which has 680 members. But Brotherson, who has been in the business since 1974, also expects demand to come back with the economy.

To their fans, Harley’s shares already discount the company’s — and the economy’s — problems. These investors are looking through the downturn to a recovery in bike sales in 2009 to 2010, and see the stock rising 25% or more in the next 18 to 24 months. By then, U.S. sales of Harley’s 700-pound “hogs” will have stabilized and perhaps even started to improve, while the company’s overseas revenue — some $1.2 billion last year — will keep growing by double digits.

Even in the lean years Harley is expected to keep generating tons of cash and buying back significant amounts of its stock, thereby boosting its earnings per share and return on equity, already near 40%. This year alone, the company has spent $1 billion to repurchase 17 million shares.

Since 2003, Ed Shill notes, Harley has shrunk its total of shares outstanding by about 25%, to less than 250 million. The stock, he says, “is as oversold as it has ever been,” and he’s been buying more lately. Like other bullish investors, Shill contends that cyclical worries have obscured the enduring allure of Harley’s bikes and accessories for riders around the world, from Hell’s Angels to weekend warriors. “Nobody tattoos ‘Coca-Cola’ on their arm,” he observes.

SO FAR, HARLEY HAS FACED THE demand slowdown head-on, cutting production and changing dealer allocations to keep inventories from getting out of hand. Instead of awarding more bikes to dealers with strong sales, as it did in the past, the company now requires all of its dealers to justify requests for new bikes on the basis of projected demand.

 
In early September, Harley announced a cut in third-quarter shipments, to 86,000-88,000 bikes from an expected 91,000-95,000. The company also said that full-year shipments would drop to 328,000-332,000, down from 349,196 last year. (These figures don’t include the company’s small Buell motorcycle division.)

It will take about a year to roll out the new allocation program, says Harley’s CEO, Jim Ziemer, 57. “If a dealer is predicting a future that is different from its history, the dealer will have to explain it,” he adds.

Ziemer notes that domestic demand and supply are “pretty close” to equilibrium now, and that “the average new bike is selling at MSRP” — manufacturer’s suggested retail price — rather than at a premium, as it was for several years.

Yet even in the latest quarter, Harley continued to generate a return on equity of nearly 40% and operating margins of 26%. Being No. 1 certainly helps: Harley controls 50% of the U.S. market for bikes in the so-called heavyweight class, with engine displacements of 651 cubic centimeters or more.

News of the planned production cutbacks heartened Harley watchers, such as Michael Millman, an analyst at Soleil/Millman Research Associates, who then upgraded his stock rating to Buy from Sell. The company “got realistic” about the marketplace and, by promising not to ship more than it can sell, took steps to protect the brand at the expense of growth, he says. “That allows Harley to make a lot of money when the market is good, and a moderate amount of money when the market is slow,” Millman comments approvingly.

Mike Schwartz, the owner of three dealerships on the East Coast, also likes the changes, calling them a dynamic approach to product allocation. “The days of loading up dealers with inventory are gone,” he says. “Now Harley’s talking about margins and turns.”

 
Schwartz, who also sells Honda, Yamaha, Suzuki and Kawasaki bikes and Polaris snowmobiles, adds: “Harley is the most precious brand we sell.”

FOR THE FIRST TIME IN A LONG WHILE, Harley trades at a P/E multiple significantly below that of the S&P 500, which fetches around 15 times forward earnings. It also trades below the median P/E of 17 for the Interbrand 100, according to a report by brokerage Robert W. Baird.

Yet, Millman says, the company has better longer-term profit growth, stronger cash flow and a healthier balance sheet than the average S&P 500 member. Millman has a 12-month stock-price target of 59.

Harley is expected to produce more than $1 billion of cash flow annually for the next few years. The company’s debt of $1.2 billion is about a third of total capital, and nearly all that debt belongs to Harley’s financial-services arm, whose loans are backed by customers’ bikes. Harley also has about $450 million of cash.

“Harley deserves more than a market multiple,” says Bob Olstein, chief investment officer at Olstein Capital Management in Purchase, N.Y., which owned 588,000 Harley shares as of Sept. 30 and has been bolstering its position. Olstein thinks the company deserves to trade at 17 times earnings, and he values the stock at $65 to $70, based on his expectation that Harley will earn $4 a share in 2009.

 
Recession fears have pounded Harley’s stock. After all, a Fat Boy isn’t an essential purchase.
One bullish sign is Harley’s growth overseas, which is fast becoming a meaningful percentage of its total business. CEO Ziemer says that international sales now account for 20% of revenue, which could climb to 30% in five years. “We translate well in other countries, even when there are big tariff barriers,” he says. “In Brazil, for example, we sold 80 bikes eight years ago, and we’ll sell 4,000 there this year.”

The opportunities in Europe are particularly compelling. Individual European dealers sell just 100 bikes a year, compared with 400 for the average U.S. dealer. In the first nine months of ‘07, American unit sales fell 4.7%, but international sales rose 13%. A weak U.S. dollar creates an additional tailwind, as bike sales in euros will translate into more dollars of revenue back home.

Just 4% of Harley’s shipments go to Latin America and Asia outside Japan. The company is focusing more on both regions, Ziemer says.

Harley-Davidson is “very much an American brand,” which gives it large and growing appeal overseas, says Emanuel Weintraub, a principal at Integre Advisors in New York, which owns 150,000 shares.

A bet on Harley, he adds, is a view that in 12 months or so the market will sense an improvement in the economy.

The Bottom Line:

It could take a year or so for the U.S. economy to firm. But when it does, Harley’s shares are likely to take off, rising to more than 60 from today’s depressed 46.One knock on Harley is demographic. The average Harley customer is a 46-year-old man, though plenty of fifty somethings also love their hogs. Some skeptics speculate U.S. demand will plummet as baby boomers start to retire, leaving fewer potential customers in the wings.

The baby-boom population stretches across two decades, however, and demand in Europe and Asia could offset declines in the U.S. long before the last boomer hangs up his helmet. Four dealers to whom we spoke noted they recently sold bikes to riders in their 80s. And Ziemer says that Harley is investing to broaden its appeal to women, minorities and younger customers.

A RECESSION NEXT YEAR PROBABLY would delay Harley’s recovery — and the stock’s achievement of Wall Street’s price tar- gets — by a year. But it wouldn’t do anything to dent the company’s brand appeal among motorcycle riders — and armchair aficionados. When the economic storm passes, look for Harley to hit the gas on revenue and profit growth, and its shares to hit the open road.

Source Barron’s Online

“Death Rays From Below”? Book Suggests Motorcycles May Cause Cancer

Motorcycle Cancer? Without much scientific background or hard evidence, author Randall Dale Chipkar questions the possibility that electromagnetic forces produced by motorcycles (which he calls “‘Death Rays’ from below”) are responsible for a “Black Plague” among riders.

“I have met countless avid motorcycle riders diagnosed with similar forms of cancers and disorders,” the author writes, “All of these riders had a type of extremely low frequency (ELF) electromagnetic field (EMF) radiation shooting up from their motorcycle seats.”

Using the “C” word is certainly an easy way to get attention, and those alarmed by the book’s subject matter should be relieved that even the author qualifies his concerns: “This does not establish proof by any means and further investigation is warranted.” More on this incendiary book can be found at motorcyclecancer.com.

I don’t know about you, but I think bikers have bigger threats than “death rays from below.”

Source Basem Wasef’s Motorcycles Blog

 

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