Conversation with the dealership owner

[Stig / Major Tom]

My local dealer.....
https://ride1powersportsspringfield.com/


I spoke today with a pretty knowledgeable scooter salesman while looking over the 2018 Kymco LIKE200i.

He introduced me to the owner of this large, 2 store, dealership. We had an interesting conversation. I asked if he was going to add the Vespa/Piaggio line to his stores - since that dealer went out of business after suffering tornado damage last year.


He spoke of the difficulty all dealers are facing these days - with the down turn of motorcycle and scooter sales and especially  the competion from the internet. Unstated is the shortened riding (and selling) season for this part of Ohio.
He spoke about the aging cycle enthusiasts - and the inability to sell motorcycles to younger riders due to insurance costs.

It might not be common knowledge - but even if a young rider can afford the down payment and payments on a new motorcycle - the cost of full coverage insurance is just flat out of sight. The young rider will be paying many hundreds of dollars a month for the required insurance. Young riders need to pay the full MSRP in order to pay less for insurance.


I know that some salesman fail to explain the insurance situation to youngsters who think they can afford to make the payments on a new bike. This dealership explains the insurance situation to young perspective buyers.


In any event, the owner explained that he feels he has extended himself as far as he is comfortable with his current line of brands - and will not be adding the Piaggio products.


I left feeling fortunate to have any local scooter and motorcycle sales - in these trying financial times.

In scooters - He has the current Honda, Yamaha, and Burgman models, and most of the smaller Kymco models.
Our family has purchased 3 of our 6 two wheelers from him.

Stig

[tortoise]

Young riders need to pay the full MSRP in order to pay less for insurance.

Curious about the MSRP-insurance correlation . . just seems like determining factors for the rider insurance rate would be age, driving history, and credit score?

The MSRP element could also be financed . . or paid in full?

[Stig / Major Tom]

Curious about the MSRP-insurance correlation . . just seems like determining factors for the rider insurance rate would be age, driving history, and credit score?

The MSRP element could also be financed . . or paid in full?

The financing party requires full coverage insurance - youngsters dump their bikes too often. For a 21 yr old you could be looking at $700 a month for insurance.
If you pay cash - you are free to buy only liability for much less $$.
So, for youngsters - full bull for a used bike is often the only way to go.
I'm no expert, but this was the way it was explained to me.
I'm old, and own my scoots.


Stig

[CROSSBOLT]

While you are at it, Stig, since you have good comms with this forthcoming dealer/owner, could you ask him about Kymco policy regarding inventory? It is my information that Kymco policy for the dealer to buy every machine he thinks he can sell. That is what the mandatory $100k line of credit is for. That there is no "floor plan" policy like with cars and seemingly most other cycle manufacturers. I have even written Ming Hsin Lee concerning this and other "things." Yes, Mr. Lee is the CEO of Kymco USA.

[john grinsel]

Insurance costs are not just the concern of young people....old farts can get screwed, too.  Example:  my new 2017 HondaCB300F Geico wanted over $600 a year for liability and comprehensive only---didn't even ask on full coverage. This bike is not sports bike, but rated by them as such.  I switched to Allstate for little over $100 a year.

These costs have to be hurting motorcycle sales in US

[CROSSBOLT]

Geico is a standard discount company. Allstate and State Farm are mutual companies with lower rates. You pay for the lizard and Flo.

[klaviator]

Geico is a standard discount company. Allstate and State Farm are mutual companies with lower rates. You pay for the lizard and Flo.

I have Flo.  I think I pay less than $400 per year for 2 motorcycles and 2 scooters. 

I used to sell motorcycles.  When customers asked me about insurance I would give them the numbers to Progressive, Geico and a local company.  Progressive was almost always the lowest.  But this will vary by person and depending on where you live.

[klaviator]

It might not be common knowledge - but even if a young rider can afford the down payment and payments on a new motorcycle - the cost of full coverage insurance is just flat out of sight. The young rider will be paying many hundreds of dollars a month for the required insurance. Young riders need to pay the full MSRP in order to pay less for insurance.

This makes no sense.  The insurance company doesn't care if you paid full price or got a discount. 

One interesting thing about young riders ( or older customers with poor credit) from my days as a motorcycle salesman.  Sometimes we would agree on a price and then try to get the customer financed.  In order to get them approved we would sometimes lower the price even more and make it look like the customer had a bigger down payment.  Sometimes it paid to have poor credit

[Stig / Major Tom]

This makes no sense.  The insurance company doesn't care if you paid full price or got a discount. 

One interesting thing about young riders ( or older customers with poor credit) from my days as a motorcycle salesman.  Sometimes we would agree on a price and then try to get the customer financed.  In order to get them approved we would sometimes lower the price even more and make it look like the customer had a bigger down payment.  Sometimes it paid to have poor credit

Correct, what I'm saying is that the young customer must carry full coverage on the bike if he is financing it! If he is not financing it - then somebody bought it outright.

Stig

[souzamoto]

 "Young riders need to pay the full MSRP in order to pay less for insurance."
Not true. Most of the time, most japanese OEM's and their supported finance companies, do not require insurance!
The sale price of the bike makes no difference on the insurance.
I sold bikes for many years and worked for a few OEM's

[souzamoto]

While you are at it, Stig, since you have good comms with this forthcoming dealer/owner, could you ask him about Kymco policy regarding inventory? It is my information that Kymco policy for the dealer to buy every machine he thinks he can sell. That is what the mandatory $100k line of credit is for. That there is no "floor plan" policy like with cars and seemingly most other cycle manufacturers. I have even written Ming Hsin Lee concerning this and other "things." Yes, Mr. Lee is the CEO of Kymco USA.

KUS would like to see dealers with 100K lines but many dealers have less. Contractually, dealers are required to stock "a representation of the line" to be in compliance with the dealer agreement. After the dealer is set up and it comes time for a re-order, dealers tend to order what sells and it is the job of the district sales manager to get the dealer to continue to stock a representation.
There is a floor plan policy offered by KUS, free flooring is given determined by level of order participation.

Mr. Lee has not worked at KUS for over a year. It's doubtful you will hear from him. He's back in Taiwan

[CROSSBOLT]

But...but...I looked on their bigshot list and it said...
Oh, well maybe someone will give it TO WHOEVER IS THE BIGSHOT TODAY! There!

I think I wasted my time. I will post if I get ant answer...I will NOT hold my breath!

[randyo]

Geico is a standard discount company. Allstate and State Farm are mutual companies with lower rates. You pay for the lizard and Flo.

I haven't found anyone cheaper than Flo,   250k/500k/250k liability and same limits on UM, 100 deducible on Collision, and ACV on comp = 5K on accessories,  year round coverage, (yes, I ride year round, even in blizzards), all for $158/yr

edit: for  V-strom 1000

similar coverage on my UXV450i (registered for street as well as off road) is only $98

[LidoCA]

 There are some dealers that will only have scooters at the beginning of the year. They may be required to carry the entire product line. Once those are sold, you only sporatically see them again during the year.