Polaris made a bet on the motorcycle industry over a decade ago when it bought the historic Indian motorcycle brand. The Medina-based recreational vehicle giant knew it would be a long road to profitability when it took on a category long dominated by Harley-Davidson.
Indian Motorcycle gets a refresh as it’s riding its biggest success
Polaris Industries is rebooting its most popular model. The success of the Indian Scout helped Polaris turn its first annual profit on motorcycles.
The Minnesota Star Tribune
April 2, 2024 at 4:43PM
But on Tuesday, the unit is riding high as it launches a refresh of its most popular motorcycle model, the Indian Scout. Last year, the business posted its first annual profit and is now consistently No. 2 in the industry in North America behind Harley, which is based in Milwaukee.
The motorcycle division started in 1997 and added the Indian brand in a 2011 acquisition. With the brand added, Polaris began to expand the unit. The motorcycles are in the On-Road unit, along with the three-wheel Slingshot and a few other small businesses. That unit now accounts for 13% of the company’s $8.9 billion in sales.
The Indian Scout refresh is the biggest product launch in the Scout lineup for Polaris with design cues and models that callback to legendary Scout models that predate ownership by the Medina-based powersports company.
Polaris initially made motorcycles under the Victory brand before they acquired the Indian Motorcycle brand. In 2017, Polaris announced it would discontinue the Victory brand. Soon Polaris was making motorcycles only under the Indian name. The historical roots of Indian go back to 1901.
“There is a strong future for Indian Motorcycle,” said Mike Dougherty, president of Polaris On-Road.
The past decade was about serving loyal customers and building the critical mass of the business, from engineering to manufacturing and sales.
“This scale in our business combined with, in my opinion, the best and most exciting motorcycles in the market, Indian Motorcycle is well-positioned to continue gaining market share, expanding the brand in the U.S. and internationally, all while growing profitably,” Dougherty said.
The motorcycle business has been consistently expanding its profit margin, Polaris Chief Financial Officer Bob Mack said in the company’s fourth-quarter earnings call.
“Gross profit margin for Indian Motorcycles was up nearly 600 basis points marking the sixth straight quarter expanding margin over 250 basis points,” Mack said.
According to Polaris, Indian’s global market share has increased from 2% in 2014 to 13% in 2023. Much of the success of Indian is the Scout model, 100,000 of which have been sold globally in the past 10 years.
The Scout is a midsize cruiser that has been the bestselling model in the Indian lineup. While it is not the most profitable model in the lineup, it is the introductory bike that builds brand loyalty and introduces riders to heavyweight bikes in the Indian portfolio that carry the highest profit margins.
To ensure the popularity of the model continues, Polaris is launching the first big model redesign for Scout in 10 years. The five new models of Scout start at an MRSP of $12,999 and go up to $21,999 for the re-release of the highest trim level — the 101 Scout, an iconic model brought back from Indian’s rich history.
At times, the Scout has been the No. 1 bike in the midsize cruiser segment; the launch of the new Scout platform could solidify that position. “The goal is to be the leader in the midsize cruiser segment,” said Ola Stenegard, Indian’s director of product design.
The Indian motorcycle brand is a hit beyond the United States. According to Polaris, it has more than 300 rider groups in 85 countries, and the company has more Indian dealerships outside of the United States (350) than inside (200).
Polaris makes most of its Indian motorcycles in Spirit Lake, Iowa. The engines are made in Osceola, Wis. The company has a factory in Poland that makes its bikes for the European market and a motorcycle plant in Vietnam to better serve Australia and New Zealand and countries in Asia.
Lloyd Greer owns Indian Motorcycle dealerships in Rogers and St. Paul and has been in the motorcycle industry for more than 25 years.
“Scout is an iconic-looking brand with modern technology and a low seat height. It’s easy to maneuver and handles great,” Greer said. “It’s great for female riders and those that are looking to buy their first new motorcycle.”
Greer got a preview of the new models. “The new Scout is just phenomenal,” Greer said. “I think it’s really going to hit a home run with that buyer.”
By the numbers
Sales of motorcycles including scooters and bikes that can be ridden on road and off road grew steadily in the 1990s through the early 2000s. From 2014 through 2023, though Indian Motorcycle has steadily increased its market share, sales in the motorcycle industry have bounced around.
2016: 394,533
2017: 375,081
2018: 360,814
2019: 348,249
2020: 349,932
2021: 397,428
2022: 381,613
2023: 385,432
Credit: Motorcycle Industry Council Retail Sales Reports
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