Harley Davidson, Inc. (HOG) is investing a record $562,500 in contingency program funding for the 2018 American Flat Track race schedule, after rival Indian Wrecking Crew riders took the Top 3 spots in the 2017 AFT Twins class; the brands’ first championship after a 60-year absence from the sport. The contingency program money serves as an incentive for unaffiliated riders to race specific bike models; with riders receiving payouts for winning (and placing in) the 18 circuit races. Flat Track, where competitors race on a 1.5-mile-long tracks at over 140 MPH, is valued by motorcycle manufacturers; seen as an entry point to the valuable 18-24-year-old demographic, riders who choose their allegiance and remain loyal as they age.
Howie Long-Short: Indian Motorcycle Co. was acquired by Polaris Industries (PII) in 2011; relaunching its racing team for the 2014 season. PII had a great Q3’ 17, increasing revenue 25% YOY to a record $1.479 billion; with a net income, up 153.6% YOY to $81.9 million. Indian Motorcycle retail sales (up 16% YOY) helped to drive the growth; with the brand’s market share exceeded 10% in September.
Fan Marino: HOG is serious about taking back the title in 2018, offering $35,250 per race (winners take home $10,000) to “privateers” riding XG750R or XR750 models. To put that amount in perspective, HOG’s entire 2015 program cost just $96,000! For those wondering, Indian riders won the ’17 Championship racing Scout FTR750s. Indian isn’t just handing the ’18 Championship to HOG though, PII is offering $350,000 in performance bonuses ($18,500 per race) for “privateers” who prefer their bikes.
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