Well, it has finally happened. Dieselgate has finally managed to affect the motorcycling community, and America might be able to reap the rewards. Italian sportbike manufacturer—Ducati—is up for sale and Harley-Davidson might be on the short list to buy, but how could a purchase like this affect both brands and motorcycling in the U.S.?
Could Harley-Davidson Buy Ducati?
In 2015, the California Air Resources Board (CARB) released findings that shook the entire automotive community. The largest automotive conglomerate in the world—Volkswagen—had violated emissions standards for the U.S. and worst of all, it did it on purpose. A software program was discovered in VW diesel vehicles that masked the vehicle’s emissions under testing conditions. After $2.8 billion in fines from the U.S., $7.3 billion to fix the violation, and another fine from Europe in the pipeline, VW is finding itself strapped for cash. This has caused the company to put Ducati Motor Holding up for sale.
The legendary sportbike manufacturer was purchased by Audi AG, which happens to be a subdivision of Volkswagen, in 2012 for about $965 million. However, now that VW is in dire financial need, the company plans to sell Ducati for nearly twice as much, $1.68 billion! So, who would be interested in buying such an expensive motorcycle company? Harley-Davidson, that’s who.
How Can Harley Afford to Buy Ducati?
Harley-Davidson has acquired the services of Goldman Sachs to help the company put together a $1.67 billion offer on the Italian mark. Many analysts are skeptical though. They believe Harley’s sales are slowing, and that the American manufacturer is losing too many sales to its rivals Indian and Honda. However, supporters of the purchase point out that Ducati’s technical innovations could boost Harley sales if used on its cruiser bikes.
For now, all talk is speculation. Private equity funds KKR, Bain Capital and Permira are also eyeing Ducati as well as Indian motorcycle manufacturer Bajaj Auto. Plus, Audi is in no rush to divest its Italian jewel, sources say finalization of any deal won’t start till November.
Keep following the attorneys who ride at the Metier Law Firm to find out more about what this could mean for the American motorcycle market.