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World Motorcycles Demand to Reach 35.6 Million Units in 2007

CLEVELAND--Oct. 3, 20030, 2003--Worldwide demand for motorcycles is forecast to advance 5.2 percent annually to more that 35 million units in the year 2007, valued at $46 billion. Driven by increased income levels in emerging markets such as India, China, and Southeast Asia, demand for scooters, mopeds and light motorcycles will remain relatively robust, providing continued growth opportunities for motorcycle OEMs and suppliers alike. The market for larger displacement motorcycles will also remain strong, although some concerns regarding future demand have emerged due to the aging of the customer base, especially in the United States and Western Europe. These and other trends are presented in World Motorcycles, a new study from The Freedonia Group, Inc., a Cleveland-based industrial research firm.

The motorcycle industry finds itself at a crossroads, with the heady growth experienced in the 1990s -- a decade that saw the virtual rebirth of the industry -- now behind it. While growth prospects remain solid, especially when compared to the 2.0 percent annual growth experienced by the light vehicle industry, the industry will likely go through a global restructuring phase in the coming years.

In essence there are two separate motorcycle markets. One is centered in the industrialized Triad (i.e., the US, Japan and Western Europe), where motorcycles are seen as pleasure vehicles by consumers who already have one or more automobiles. These motorcycles tend to be large, powerful machines that cost on average about $4,000 to $7,000 in the US and Europe, and somewhat less in Japan. The other, much larger market in unit terms is in the emerging economies of the Asia/Pacific region, where motorcycles are seen as primary family and work vehicles. These vehicles are far less expensive, smaller and less powerful than Triad motorcycles.

The motorcycle industry is currently undergoing a technology transition, driven by a confluence of factors, although the greatest force appears to be related to exhaust emission regulation. Motorcycle regulations have been increasing worldwide, as developed nations seek emissions parity with automobiles and as developing nations fight to reduce pollution levels in large urban areas.