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April 13, 2012

Iwata Bound

A quick hello and goodbye. I will be leaving on Monday for Iwata JP and a couple of weeks of meetings. The past days have been spent in preparation and my mind has not been on blogging and Sled Talk. I find it difficult when I am really focused on planning, to come up with creative topics that can be shared here. There is so much I would like to address but no way I can think of that would not jeopardize our future and my current position, (I like my job). It’s much like watching an iceberg, you get to see a chunk floating along and are left to wonder whats lurking beneath the surface, waiting for the balance to shift before it becomes exposed.

This past winter season has left dealer inventory higher than we would like, and from what I have seen in the figures, we are not alone. Overall though things are not so bad. The western region has had record snowfall and the east had a good finish as well. There will no doubt, be some aggressive sales programs going into the fall on non-current and production will likely be adjusted by all 4 OE’s in consideration of same. But snowfall and mother nature has always dealt the trump cards in this game and we always seem to persevere.

The economy has had it’s impact on us as well. One positive thing that has come out is in regards to our parts pricing in Canada. The traditional model was to take our FOB cost from the factory and add margins to average costs, dealer net and retail, based on the Canadian dollar / yen exchange. Most of this was done when the Cdn / US dollar had a significant spread, and was fairly accurate. That has all changed now with a par dollar and as a result we have taken on a pricing alignment project to balance our pricing with that of the US. Contrary to what many of you believe, some of our parts were actually cheaper in Canada but many of the higher ticket items were significantly more expensive. The adjustments have seen some prices go up, especially on parts under 10 bucks but many of them have come down (a lot). The formulas to make this work are quite complicated and effects thousands and thousands of lines. There is still a split between the two countries largely based on the economies of scale, but we are now much more closely aligned with Yamaha USA.

I’ll try to give you an update on our progress in Japan or at least a hint or two of what we had for dinner 😉  cheers cr

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22 Responses to “Iwata Bound”

  1. sean says:

    Have a great trip. Looking forward to your blog upon your return. Do not forget to take a few Yen with you ; )

  2. snoguzzler says:

    Man O’ man I can’t wait to see the rest of that iceberg!!!
    And speaking of liking your job how does a fella get a gig like that?

  3. trailcruzer says:

    Chris,

    Are you trying to tell us that the people in Iwata don’t read what you write and the replies from us regular people? C’mon!

    If the people that you report to can’t take constructive criticism (I said constructive…not destructive) then maybe you’re not a good fit for them. Then again…I think you’re embellishing a bit.

    Leftover inventory? = I went into my local Yamaha dealer right before the snow melted to inquire about a 2012 Vector long track. Price he gave me was higher than what my friend paid for his 2012 Vec at the beginning of the season, and this dealer had several Vectors to choose from. Calls around the region yielded the similar numbers. If there’s a logical explanation for this I’m all ears!

    Travel safe my friend!

  4. Chris says:

    Hmmmm good point re my friends in Iwata. I have not explored the possibilities of having the blog translated to Japanese LOL. That said Google analytic s does show me I am getting a hand-full of viewers in Japan.
    As for the dealer pricing, guess it goes to show Yamaha’s hold there prices better than some others 😉

  5. Darren says:

    Very happy to see the us/CND pricing coming closer. I’ve noticed it when shopping for 13′. But the one place you forgot was power serge, the us has great promotions, here..ummm not so great.

  6. RSILK says:

    What is the pic of? Would be nice to enlarge it….

  7. Yammerhead says:

    Ahhh, care to elaborate on the picture at all? A Phazer prototype perhaps?

  8. Mr. T says:

    Trailcruzer,
    I think your example on the difference on the vector price from the fall till now is exactly what Yamaha wanted to happen by releasing nothing new in 2013. How much more will they try to sqeeze out of their faithfull Yamaha riders. Again this is my opinion.

  9. pat the rat says:

    hope you have a great time with your japanese co-workers,about pricing for accesories and parts,i was at the dealer today,needed 1 tiny bolt that holds the windsheild on my grizzly,plus a light bulb and a few other things,you are right,some parts are priced normally but others are out of this world,the tiny bolt was $6 + tax,i couldnt beleive it,then this winter i bought a pair of handlebar mounted mirrors for both sleds,they were a steal at $35 for 1 pair ,why is it all over the place like that,
    chow
    pat

  10. jamie says:

    How about making that pic in the blog clickable so we can see it full size 😉

  11. trailcruzer says:

    Mr. T,

    Well if that’s their tactic it’s keeping me from buying a new Vector to replace my old one. I never was and never will be categorized as “insert brand name here” faithful. I need a sled that’s easier to turn and if it’s not a PS equipped Vec, I’ll find another brand and model that is a fit for my needs.

    Chris – have some sake’ on me OK? Say hi to the folks over there too!

    TC

  12. Justin says:

    That appears to be a Yamaha variant of a Can Am Spider (of sorts). I’m thinking perhaps an answer (of sorts) to the lack of snow that we have been experiencing in recent years (or inconsistent snow). I’m thinking of something “revolutionary” in the sense that it’s a hybrid of sorts….in that it can easily be configured to be used as an “all-season” type unit. Perhaps it’s all of the above. While I like the concept I would personally urge caution in moving forward with a product like this if it does “everything” ok but nothing exceedingly well. Risky business to say the least! Nevertheless, I trust that my friends in the far east know what they are doing. If a product like what I am speculating about is excecuted correctly AND marketed correctly it could sell in great numbers. A product release like that could be a watershed moment in motorsports and could ultimately spawn other great breakthroughs. In otherwords, sales begets reinvestment in tech and that reinvestment begets more sales. Look at Bombardier’s rebirth in the snowmobile market. In short, it started with some key people who understood what consumers wanted. I won’t go into who those people were, but it started with “F” chassis around 1993. From there, onto the “S” chassis, then on to “ZX” and then on to “REV.” At this point, leadership was solid and the company was still struggling financially. Great products and leadership however resulted in a reinvestment from private equity firm Bain Capital, some focused and committed members of the Bombardier family, and the Canadian government. What followed was “Rev XP”, “ETEC”, etc. Again this is not a rant on how great BRP is…. what I’m saying is that product is and always will be KING. But you have to sell units to foster the investment in R&D that begets more sales. Friends, Yamaha Motor understands this and as Chris has suggested many times, THEY HAVE A PLAN! Make no mistake about it. For the record, in the past ten years, Yamaha snowmobiles have sold quite nicely and those sales drive everything (in a matter of speaking). I firmly believe that Yamaha is on the verge of something very big; something born of the labors of the past ten (or so) years in the snowmobile business. If there is a watershed type product in the pipeline, but it’s not something that will resonate with everyone, don’t think for a second that it won’t directly or perhaps indirectly spawn products that almost everyone can get excited about. I’m quite certain this product is coming folks. Just a feeling;)

  13. 7 skulls says:

    That pic comes from timbersled products. They build conversion kits for moto-x bikes. Some wicked vids and pics on their site.
    Sure hope there is some revolutionary new iron at big Y. Keeping the faith… hopefully on a new yfz 450:)

  14. Mr. T says:

    Chris,
    Not really changing that much in the last few years in the sled,quad and side by side markets, is this the direction Yamaha is going? Referring to the picture you posted. I know you can’t answer that but it does make sense to be a viable option for the future!

  15. scott says:

    Yamaha should realize that its main selling point of reliability and dependability with its 4-stroke motors has been addressed by the other OEMs in two ways. One they also offer 4-strokes and two, you can buy a Ski-doo with a 3 year warranty or a Polaris with a 4 year warranty. When the engine lets go, so what? They fix it, you ride it some more and then sell it after 2-3 years with a year left on the transferrable warranty. All sleds at 3000 miles show signs of wear and tear so that’s a good time to sell and move on. Plus the other OEM’s innovate and produce sleds that are better, lighter and more capable every year making you want to buy a new one. Since a majority of riders are into the sport for recreation, performance is the #1 priority.

    Maybe someone at Yamaha will finally wake up and realize that producing the snowmobile equivalent of minivans is not the way to sell more sleds or keep your existing customers. Who cares how reliable or long running a 4-stroke Yamaha is when they are not as fun or capable as the competition’s machines.

  16. Mike J says:

    I’m not sure who you guys ride with, but to say that the other guys (OEMs) have addressed Yamaha’s quality and durability by introducing their four strokes isn’t seeing what I see. I’ve seen too many AC and Doo 4-strokes having big issues this year while our Yamahas cruise through their 4th year without an issue. It may be a small sample size, but if there are issues here then they must be really big in the major markets. The competitors may have 4 strokes but they are no where close to the quality and durability of the Yamaha engines, IMHO. Riders in this area have bought 4-stroke machines from their favourite brands to get the reliability they see from Yamaha, but I know they aren’t getting it… I feel really sad for them when I have to offer a tow home!

  17. scott says:

    Cat’s 1100 motor has been out since ’07 and has a reputation for good reliability. It wasn’t until this season that it was promoted to any great degree. Cat had two 1100’s in the Iron Dog ridden by two racers that were in their 50’s. They were on track to be top 10 finishers had they not thrown a stud into a heat exchanger on the Yukon heading back to Fairbanks. They were doing much better than has any Yamaha team in years. Doo doesn’t do much to promote their 1200 but their Ace motor has been holding up well, much better than the Phazer from what I read.

    Looking at the worldwide sales figures Yamaha is getting close to matching their low sales numbers in 1996. They’ve been in decline since ’08 and dropped fast. It is obvious that the average snowmobiler wants performance, not engine reliability wrapped in a poor performing chassis. Transferable, multi-year warranties allow the performance rider to have their cake and eat it to.

  18. Brady says:

    I am not brand loyal by any means, but I do buy what I believe to be the most reliable and dependable, because I ride in some very remote places and I can’t afford a break down. Yamaha has been the best as far as reliability and dependability goes for the last few years. Go ask you local dealer which brand they have the least problems with! Also look at maintenance schedules for the other brands 4 strokes and look at how many miles they are getting out of them. You will find Yamaha on top every time. And I wouldn’t use the Iron Dog as an example if I were you, because there were 42 total teams this year and only one was riding Yamaha and they were a rookie team. And only 29 teams finish and the Yamaha team was one of them. That is better odds then any other brand ever! I could go on about problems others are having and sales numbers etc. but I don’t want to take any more of your time. Just know that Yamaha has always done this, sit on what they have and then come out with something extreme then sit again. We just need to see what happens next.

  19. scott says:

    I hope Chris doesn’t mind a bit of debating on his blog? The Iron Dog is an excellent example to show how a sled needs to have a balance of reliability AND performance/handling. The 1100 Cat did very well for a sled in its 1st year of production. In my mind Cat has done a better job of creating a 4-stroke sled that has a good balance of reliability and handling and performance. Not to take away anything from the 14th place Yamaha team but they were never in contention for the whole race and it could be argued that by riding at a slow pace your chances of breaking down are minimized. It could also be argued that due to the subpar Nytro handling that their sleds could not maintain the pace necessary to place in the top ten. The fact that the Cat 1100 team scratched due to a throw stud doesn’t mean anything since that can happen to any liquid cooled sled. What their entry did show was that a 4-stroke sled can be competitive against the lighter 2-strokes.

    If Yamaha comes out with a new model or improves the Nytro they should offer a huge contingency prize for a 1st place finish in the Iron Dog. This would get far more teams on the brand and create a lot of exposure. A first place finish would show the world that the sleds are competitive and have the performance and handling to beat the 2-strokes. I suspect the money spent on this would be a pittance compared to what what spent on the sno-x program.

    Thanks Scott, for the record, I don’t mind a bit of debate here and I don’t wont sanitize any comments or sugar-coat a response. Funny thing about terrain racing though, I always looked at it as mechanical (equipment and dollars) physical (riders ability) and mental (teams desire and preparedness). Hats off to any team that can challenge and dominate a race like the Iron Dog.. it ain’t all and only the sled. cheers cr

  20. scott says:

    As always I’m never ceased to be amazed by how you do not edit less than positive posts about Yamaha or their sleds. I truly respect that!

    I spoke to the Yamaha Race Dept today and like you’d posted earlier, there is a lot going on behind the scenes. I got a glimpse of a much larger world that was unknown to me and the myriad of factors that go into producing anything. It was fascinating and I’m now able to make much better sense of the current situation with Yamaha sleds.

    I’m glad you keep your blog so candid and open because you are able to get the raw comments from real world riders and that is valuable info. Of course it has got to be tough for you guys to read negative things on the internet and not be able to respond.

    Keep up the great work Chris! I’m always checking in to read the next post.
    Cheers,
    Scott

  21. ruffryder says:

    So what did you have for dinner? lol

  22. Apex/Vector says:

    No posts for a month and a half. Hopefully you were only “Iwata Bound” and not “gagged”!


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