Almost a year after Taiwan opened its import market to heavy motorcycles (those with engine displacements over 150cc), eliminating a ban that was imposed in the late 1960s to save energy and protect the local motorcycle industry, sales here have been disappointing and some major international brands have still not been able to find appropriate dealers on the island.

For example, the legendary American brand, Harley-Davidson, was highly active in sending representatives to participate in public hearings on the opening of the market and urging the Taiwan government to relax the rules on heavy motorcycles. Despite the fact that many local companies have tried to win the local Harley dealership (including the No. 1 motorcycle maker, Kwang Yang Motor, and Taikoo Automotive, importer of Audi and Volkswagen automobiles), the U.S. company has yet to designate a winner.

In fact, Harley reportedly now wants to set up its own branch office on the island. Local dealers have been unable to meet its standards, the reports say, among them a requirement for certified real-estate assets of more than US$3 million as well as comprehensive brand operation and sales-channel development plans.

Officials at Honda Motor Taiwan say that the domestic market for heavy motorcycles suffers at least two disadvantages: a relatively weak and immature consumer environment, and the lack of accompanying laws and regulations for the opening of the heavy motorcycle market. Other obstacles are crowded and chaotic traffic conditions, a poor travel infrastructure, and the ongoing economic slump.

In addition, some importers feel that local regulations on emissions and fuel consumption is inhibiting sales. In the international market, one of them laments, 180cc and 200cc models are not considered "heavy" motorcycles, as they are in Taiwan. Furthermore, owners of motorcycles with engines larger than 250cc have to pass a relatively difficult riding test and pay much higher taxes than owners of lighter models.



For these reasons, states Wu De-ming, assistant manager of Honda Taiwan's PTW (powered two-wheeler) business division, his company will watch the domestic market for at least another year before going ahead to map an overall marketing strategy for heavy motorcycles.

Another foreign manufacturer having trouble finding a local distributor is Aprillia, a leading Italian brand. Aprillia originally planned to name Sanyang Industry (Taiwan's No. 2 maker of powered two-wheelers last year) as its local dealer, but the proposed cooperative venture fell through when the two prospective partners were unable to reach an agreement on the Taiwan operation. Aprillia is still looking for a local dealer, but its representatives here are pessimistic about finding the right one soon.


Disappointing Performance


Industry analysts point out that the market has fallen far short of the original expectations of the government and private sector alike. The Ministry of Economic Affairs (MOEA) estimated that about 40,000 motorcycles bigger than 150cc would be sold in the first year after market reopening, and private sources predicted that sales of vehicles over 250cc would reach at least 10,000 during the same period. In the first six months after the market was reopened, however, total sales for motorcycles with engine displacements over 150cc reached only 1,099 units.

The market leader in the line is Pan-Germany Automobile Co., importer of BMW automobiles and two-wheelers alike, which sold 535 BMW heavy bikes from September 2002 through May 2003. The company's motorcycle-sales manager, Lu Wen-chih, confirms however that the volume of sales has been extremely low in comparison with original expectations. The company initially predicted first-year sales of about 20,000 motorcycles above 250cc, but that figure has now been adjusted downward to just 5,000 units annually.

Ducati, a famous Italian motorcycle brand, is even more disappointed; its local dealer has sold only one heavy motorcycle during the past nine months.

Triumph, a British brand, reports that its business in Taiwan has been less than half the original expectation. As a result, the local Triumph dealer has decided to go into the leasing business so as not to waste all of the units which it has purchased, and to expand into repair and maintenance services.

In contrast to the imported brands, both Kwang Yang and Sanyang have enjoyed good sales of heavy powered two-wheelers. Kwang Yang was the first local maker to push models above 150cc, introducing its 200cc Venox motorcycle and EGO and Grand Dink scooter models in mid-2002. Sanyang followed by rolling out its 180cc RV-180 scooter, which, the company says, has become one of its most profitable products.