Archive for February, 2016
February 22, 2016
Gotta Be Quick
We spent most of last week preparing for our upcoming new product launch. Our strategy is simple – select a few dealers we know and trust that are well respected for their experience and credibility. Assemble them together with a film production crew and some prototypes to experience the new machines, talk about what they discovered and capture it all to share on the big day. It was a lot of fun watching the reactions to the new sleds from the initial walk around to the interviews at the end of the test track. Needless to say, some were more surprised than others but all were smiling without exception.
We had dealers from Norway, Finland, Sweden, Canada and the US. I really enjoyed the time spent after the work was done, chatting about the various markets and snowmobile lifestyles. There were lots of interesting nuggets exchanged over some locally brewed IPA. It was a short event with everyone in and out within 48 hours. I stayed back to meet up with an old friend to do some additional filming and tech briefing which will hopefully be part of the MY17 preview on SnowTrax TV. Mark had a pretty good grasp on what our new sleds were all about but I think I was able to surprise him on a couple of points.
Our next step is to bring in all our field staff from across Canada which is happening as I write this. The initial plan is to make some time for everyone to pull the trigger on the prototypes between meetings and training sessions. That said, I need to get up to the test site as soon as I post this to see whats left after a freak rainstorm took out most of our trails on Saturday. My fear is what little is left maybe reduced to a skating rink. This is the most depressing, un-cooperative winter I can remember in southern Ontario…
While all this is going on, our big rigs are rolling into West Yellowstone for the annual media Snow Shoot where all four manufactures get with the sled journalists to get briefed on all the new offerings. I am not sure at this time if I am required to head down there. We have had to shuffle the deck a bit with respect to staffing and I am still waiting to find out if I am heading north or west. And on that note, I gotta get my butt in gear, shut down and hit the road.
Posted @ 10:47 am in Yamaha Insights
February 14, 2016
I awoke to minus 32C this morning, second day in a row of Arctic air at the cabin. On my second cup as the sun breaks through the trees, reading the comments, speculating on what would be our next big thing in snowmobiles.
Snow bikes seem to be getting a lot of traction in the rumour mill. Let’s think about that one for a moment. Here’s a couple of facts you should know. The total market today is approximately 10K units sold. This is the entire history of SB sales. Timbersled is by far the largest player in the kit game, holding several key patents on the conversion. Polaris recently acquired Timbersled in what some consider a block play and now possess those patents. SB don’t work worth a damn on hard pack (current technology and design). SB kits require a host motorcycle on which to install them. In addition there will be political hurdles to overcome as they become more mainstream, definitions, compliance, regulations etc..
Now all that said, many guys are choosing Yamaha YZ’s as the bike of choice. One could say we are already in the SB business by Ascension. But if we really wanted in I suppose it would be best to build a complete SB just like our friends at AC have proposed. Nice way to skirt around the patents and save the consumer the cost of wheels and rear suspension they don’t require. That would require significant investment and if based on a YZ would open a Pandoras Box of liability and risk exposure in breaking new ground or snow as is the case.
End of the day, the SB market is currently planted firmly in the Rockies. It’s cool, it’s growing but its niche. If I had to draw sales projections over three years for a new SB project, it would be a single K digit (note: I’ve been wrong before!). We could build the best SB ever considering our wealth of MC and SMB engineering, or we could sit back and enjoy a few extra sales in the already very healthy off-road motorcycle world…. March 1 will tell all. cr
Posted @ 8:40 am in Yamaha Insights
February 10, 2016
Hey, Wait a Minute.
The guessing game continues. Thinking a little time spent reflecting on a business model might not be a bad thing right now. Hopefully this may help put things in perspective for those with expectations beyond the realm of feasibility.
At the start of the current millennium, Yamaha made the decision to go 4-stroke as a company, not as a single product group. The idea was born at a level far above my pay grade so I can only speculate on the details. Yamaha looked at the reality of the global marketplace considering all products; marine, motorcycle, power equipment, recreational vehicle (including snowmobile) and scooters. The conclusion – four stroke technology is the best overall direction for Yamaha to offer clean, reliable, fossil-fueled power to meet the needs of the immediate future.
I was in the room when this strategy was introduced to the snowmobile division. At the time I actually believed we had a choice in the matter (I know). Anyway, we debated the pros and cons with great fervour. The deal breaker came when engineering provided information indicating the 2-stroke snowmobile engine would not survive the second round of EPA emissions standards in the US. This was based on the technology available at the time. And so it was, we were down on all fours. Ooops.
For the most part however, the direction has proven correct and the emissions clock is still ticking on the snowmobile anomaly, but lets pretend for a moment, that we could hit the snooze button and propose developing a new hi-performance 2-stroke engine. The first challenge is to justify a return on investment. To design, develop, tool and manufacture an engine (any engine) costs billions of Yen (millions of dollars). The total cost is amortized to be recovered over a fixed period of time, generally a couple of years. The best way to secure the investment is by showing a potential sales volume capable of off-setting the costs in the short term thus providing reasonable profits further down the road. OK, I’ll go on record here as saying the snowmobile business is not showing a lot of growth these days. None of the manufacturers are raking in the dough selling sleds, in fact its a damn good thing we have all diversified manufacturing to produce other motor sports products. This trickles right down to our dealers where you wont find too many that can exist selling snowmobiles alone.
This relationship to producing other motor sports product along with snowmobiles is key. The best way to increase the production volume of an engine is to put it in more than one product. You don’t have to look too far in our industry to see the results. Our competitors have justified their 4-stroke development by sharing engines with SxS / ATV / squirt gun and motorcycle (even the ones with ‘training wheels’). It’s good business. Yamaha has done this successfully for years and now it is a mandate. As a rule, our new engine development projects must have the ability to apply, at least in part, to more than one product group. Herein lies the quandary for new 2-stroke development. Where else could we apply a big two-stroke performance engine outside of snowmobile these days?
Before you jump all over me on this, think of the current markets. Look at personal watercraft, look at motorcycle (including dirt), look at ATV / SxS, look at outboard engines, (OK BRP is still trying but…). Point is – reliability, cost of operation, emissions, applications, warranty risk, longevity all out weigh (pun intended) the advantages of a 2-stroke in everything but snowmobiles, or so it would seem.
Now, all that said, I like 2-strokes. Always have – always will. When it comes to purchasing any of the above products, 4-strokes have clearly taken over. In my case, I own boats, ATV’s, motorcycles and they are all 4-strokes except for my old sleds and my beloved Husqvarna saw. One must concede – The future market for 2-strokes is not looking so good.
So, back to the business model: Mr Yamaha, we want to invest XX million dollars in developing a new 850 state-of-the-art, 2-stroke snowmobile engine. We plan to sell 12,000 over three years providing there is no change to emissions regulations under Mrs. Clinton and maybe you can make $200 profit each if we sell more. Oh, and we get slammed with a Polar Vortex every year during her term. And if you make a really good one – one that lasts as long as a four stroke, doesn’t burn any oil, get’s great fuel mileage, doesn’t go bang if it gets lean and accepts boost easily, we might be able to use it in another vehicle or two…
Wait, where are you goin?
February 4, 2016
Low Slung asked an interesting (and timely) question: The sled industry is pretty unique in that the press gets to ride the sleds before its release to the public (Not the norm in the car industry,too many spy pics before hand). Does it worry you guys that someone may get a snapshot of the new iron before its released to the world?
I thought I would share my response on the subject of spy-shots and leaked information prior to a new product release.
First, the media must sign ‘non-disclosure’ agreements and abide by our embargo timing when we give them advanced information on new models. They need extra time to prepare their publications and web-sites to coincide with print schedules and embargo dates. They would be open to law-suits if there was an intentional leak (note: we have never had to exercise this option to the best of my recollection).
We have had to deal with ‘spy’ shots getting leaked from inside sources and there have been cases where people have lost their jobs over this depending on circumstances. When it does happen there are generally two internal camps that quickly form. One side will be all freaked out, in damage control mode, wanting to recall, blame and punish (possibly justifying their own position). The only thing more damaging than having something published to the internet you want kept secret, is trying to chase it down and remove it – doesn’t work so good!
I tend to sit on the other side where, if I see no harm done (based on timing and details) it is fun to observe and embrace the ton of excitement (not to mention the free advertising) that’s created as the pics go viral in the ‘hunger for info’ enthusiast sphere. The social aspect of the internet along with camera phones and portables really have had a profound impact on all of this.
Leaked pic that didn’t hurt too much
And one that did!
Outside of the company lays a conspiracy group that rises up if there is any indication or conjecture the ‘leak’ was fabricated by a manufacturer to gain attention. We are not very good at that game-not at all. There are far to many politically correct people and processes inside of Yamaha for us to ever get consensus on breaking a rule. Instead we’ll hire an agency to produce a polished ‘teaser’ video ‘Hollywood style’ and proudly brand it Yamaha ‘revs your heart’, to get things buzzing. These clips are carefully designed not to ‘tip the wagon’ then approved by kings and council. I still chuckle when I see what some guys actually make of them – ‘I freeze framed the whole thing and found one millisecond of footage where, when I zoomed in 50x and applied an enhancing software program downloaded from a Russian hacker site, I was able to confirm by the heat signature it has three cylinders and the chase vehicle in the dusty distance was in fact a Gillette 1000…’ truly fascinating forensics.
The other source of leaks is far more nebulous. The old forum thread ‘I have a trusted friend in the industry and he told me…’ More often than not it’s bogus but there have been times when I read things containing details clearly originating from an ‘insider’. The best part of these ones is sitting back and watching the on-line banter as the ‘leak’ gets called ‘bull spit’ by other ‘seers’ or the comment gets hi-jacked then buried in a sheer flood of opinion. I watched one of these unfold over on TY, I was almost believing the guy was legit before he tripped. I have learned not to react too quickly to this type of leak but there are times when the message needs to be heard. I delivered a little sermon at our last field staff meeting after reading something which I was able to determine came from one of our staff. Didn’t single anyone out, instead reminded all that their closest friend who they completely trust and confide in also has a closest friend who they completely trust and that person ain’t you!. My old pal Greg Marier once said something to me in Japan years ago. ‘Chris – two of us can keep a secret – if one of us is dead!’ Fortunately we are both still kickin’ and Greg san, your secret is still safe with me 😉
Stay tuned, I feel a ‘leak’ coming on! (maybe it’s that damned old age thing) – ‘Depends’ 😉 cheers cr
Posted @ 2:28 pm in Yamaha Insights
February 2, 2016
if a tree falls in the forest
I am not sure I know why today is the day any more than I know why it took this long. But its high time I came back to Sled Talk to reflect a bit on the past few months.’
First off I want to apologize for not posting an update at least acknowledging my sabbatical from blogging. Truth is, it was never really intentional. I have just been so caught up in my new world of organizational reform and change that Sled Talk has almost become part of a former life. Tim K dropped into my office this morning with an invoice for the web hosting of Sled Talk asking me if it was still alive. I did not know how to respond. After a little chat and show of support, he left me to ponder the fate.
A few visitors still come to the blog to read some of the old development stories and ramblings but the fact is: ‘content is king’ and as many of you have pointed out, I haven’t posted diddly squat in some time. It was never my intention to ignore things this long, it just happened, a product of my ever evolving environment.
So, yes I am good and still here. On the other hand, the snowmobile
Feb1 20% of normal
industry is not so fortunate. The lack of snow in the key central markets, the warming effects of El Nino and the grinding halt to sales after Christmas is not what any of us needed this year. I am embarrassed to say I have not stuck my trail permit on my sled yet. Thinking it may well end up a sad reminder of the season that wasn’t, by adorning my beer fridge.
What makes things worse is the fact we, as an industry, are coming off a great year past and as a company are working hard on some new products for model year 2017 that I am positive will turn some heads. BUT all that said, it is not over yet and it wouldn’t take but a few cold days and some snow to get us back in the game.
Kind of like me, all it took was the timely threat from Tim to pull the pin on Sled Talk accompanied by a good hug to get me back on the key board. There are some things I would really like to share and speak to here in the near future. March 1 is our next embargo and there are sure to be some questions, so here’s my commitment to finish up this season with some regular posts and we’ll see where that goes.
think snow!!! cheers cr
Posted @ 9:01 pm in Yamaha Insights