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Edited Date/Time
5/15/2020 6:30am
I listened to most of JT’s latest Industry Seating podcast on the way to work this morning and he addressed a question he got about how Suzuki should move forward. His thought matched something I’ve thought about for a long time which was for them to forego development and focus on reducing production costs to create a $5-$6K four stroke MX bike. He noted they could reduce marketing, product development, etc. and match an unserved market for those that want new bikes but do not want to spend $8-$10K on a new bike.
Suzuki could drive BNG's and reduced production costs (which they kind of do already) but then focus on volume. While he believes it will never happen because Suzuki would have to swallow their pride about being second tier, I think it’s a great plan. I for one would switch to Suzuki if this were to happen just because I value having a fresh machine regularly. You would also get a lot of traffic into Suzuki dealers and make up a lot on volume. While the price target seems low, many of the year-end promotions get close to this value, so it doesn’t seem impossible.
Do you agree this would be a good route for Suzuki to go?
Also, as an FYI JT mentioned he ignored the two stroke topic because “everyone agrees it would be awesome”. Finally, Industry Seating is a really good podcast if you aren’t listening weekly.
Suzuki could drive BNG's and reduced production costs (which they kind of do already) but then focus on volume. While he believes it will never happen because Suzuki would have to swallow their pride about being second tier, I think it’s a great plan. I for one would switch to Suzuki if this were to happen just because I value having a fresh machine regularly. You would also get a lot of traffic into Suzuki dealers and make up a lot on volume. While the price target seems low, many of the year-end promotions get close to this value, so it doesn’t seem impossible.
Do you agree this would be a good route for Suzuki to go?
Also, as an FYI JT mentioned he ignored the two stroke topic because “everyone agrees it would be awesome”. Finally, Industry Seating is a really good podcast if you aren’t listening weekly.
The Shop
This type of buyer is also reasonably well-served with the used bike market.
Clearly they need to do something. Can't see them investing in electric at this stage. I think they were onto something with their modular frame concept for 250Fs and 125s awhile back.
Suzuki Vitara MSRP $22,500
LandRover Discovery Sport MSRP $37,800
KTM 250 SX-F MSRP $9,100
Suzuki RMZ250 Could MSRP be $4,500-$5,000????
"Suzuki Motor is a Japanese manufacturing company that offers automobiles, motorcycles, ATVs, and other products. Much of the company's revenue was generated from the automobile segment in 2016, with USD 25.38 billion, which is about 90.5% of its total revenue. The motorcycle segment generated 7.4% of the revenue in 2016, and the remaining was accounted for by marine and power products."
...and Jason thinks he's got a recommendation -----LOL!
Right now, Suzuki sort of has it both ways, claiming to make a great MX bike, but selling it cheaper after rebates. If they drop the price and stop the R&D, I doubt they make up lost profits on volume. People on budgets usually finance bikes anyways, and the finance rates are so low, they can probably get a RMZ250 for 150 a month, or a YZ250F for 170 a month.
I think Suzuki is in a weird place of having too much pride to do this anyways, but not enough pride to dump a bunch of money into the line. Admitting your product isn't great usually isn't a great move!
If I were Suzuki, I would invest a some in R&D so the bike doesn't age too much, but still keeping costs / weight down by doing things like not doing electric start. They come out with new bikes that handle well, which they can claim are new / great, but they aren't spending a ton to develop and produce them, so they can sell for less.
However I don't think this plan would work for an MX bike. Even if they don't need it, it seems like most MX guys dream of having the newest, latest, greatest bike, with all the features, power, and whatever trinkets they sell it with. Obviously not everyone can afford these overpriced spectacles, but thats where the used market kicks in. Just wait a couple years and that bike can be yours, and thats what Suzuki in essence would be competing with. Yeah that factory edition bike isn't brand new anymore, but if you find one well maintained at the same price as a second tier bike brand new which would you buy? Also at least around me RMZ450s are already smokin good deals at the dealership, yet last weekend when I rode at the track out of probably 80 bikes 1 was a Suzuki.
Ping had a good idea a few years back on just pull cost out where it doesn't matter to get the MSRP reasonable. His point was specifically on entry level 125 and 250 smokers I think but the point carries over to any bike. Build a good engine, and chassis, those things are expensive and harder to mod so just make sure they are legit from the factory. Then go cheap where it doesn't matter. Cheap bars, grips, tires, whatever. These are all things that are common mods anyways so it gets the price down at the dealer, and then lets you customize it the way you want it.
MX is mostly a young mans sport. I'd venture to guess that many get to the point where they can give up the racing, but not riding the bikes (I'm one of them).
So for many of us it's like, sure I want all the latest bells & whistles, but how much will that really matter for the riding that I do? And I can save how much, by going with one of the lesser developed models?
There is a market for bikes that the manufacturer has basically said - good enough - YZ125s & YZ250 still sell well, right?
Suzuki could just be playing the risk/reward game and figure they don't want to invest a bunch to sell not that many more bikes.
Admitting 2nd tier status I'm sure isn't the positive part of the picture. But you can't forgo development for years & then deny you've fallen behind.
I'd hate to see Suzuki MX/SX teams go away, though.
Pit Row
Yamaha could do the same with their 2 stroke lineup – it's not had any R&D since 2008? What do they cost new compared to then, or a KTM/Husky?
2020 YZ 125 in Finland: 7790€
2020 SX 125 in Finland: 8395€
But they still sell enough of them globally, so no need to dump the MSRP.
All the manufacturers seem to be missing the point of pricing in this regard.
Anything that's a barrier to entry dwindles their market-base.
The 2 strokes still sell quite well and they havent had to spend anything on development or tooling on them since all that was complete prior to the release of the new alloy frame 2005 model...
Money for jam really... Im sure it makes their 4 stroke bikes more profitable
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