How can I buy Scooter stocks ?

Discussion of the Genuine Buddy, Hooligan, Black Jack and other topics, both scooter related and not

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southernscoot
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How can I buy Scooter stocks ?

Post by southernscoot »

Is it only me or has anyone ever pondered over purchasing stocks in Genuine or PGO ?The way the sales have been the past few months is it too late to purchase and how would I go about doing it ?
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Post by toddrw2251 »

Doesn't look like PGO is on any of the american exchanges. There parent company is Motive Power Industries Co and I couldn't find them or PGO on the Taiwan Stock Exchange.
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Post by illnoise »

Genuine is privately owned. Piaggio just went public (on the Borsa) last year and hasn't been doing very well, there's already talk of a partial buyback. Bajaj and other indian companies have almost abandoned scooters in favor of budget minicars to fight the Tata Nano. China is China, so that's out.

You can find other manufacturer's parent co. names here:
http://2strokebuzz.com/index.php?page_id=3946

Now isn't the time to invest in scooters, that time was five-ten years ago. The boom here is peaking now, and sales are declining in most other markets.

If you study the history of scooters in America, there's a very clear cycle/pattern and history has repeated itself. Genuine really understands that and has positioned themselves well, and Piaggio, like usual, has learned nothing and is repeating the same mistakes they've made several times before.
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Post by schlagle »

illnoise wrote:Piaggio, like usual, has learned nothing and is repeating the same mistakes they've made several times before.
Could you expand on this a little? I'm genuinely curious about what you mean. I don't understand scooter market at all so I'd like more info if possible.
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Post by illnoise »

schlagle wrote:
illnoise wrote:Piaggio, like usual, has learned nothing and is repeating the same mistakes they've made several times before.
Could you expand on this a little? I'm genuinely curious about what you mean. I don't understand scooter market at all so I'd like more info if possible.
Sure!

There have been several scooter booms and troughs in the US, the first two were domestic machines with rural roots (Cushman, Doodle-Bug, Salisbury, etc), then, post-war, european scooters came to the scene (Vespa/Lambretta), they had a few ups and downs through the 50s, 60s, and 70s, then japanese scooters (Honda) had a boom in the 80s and this current boom (more international in nature) started in the late 90s.

Since the 30s, there have always been scooters of some sort available, but the market for them is generally tinkerers and bohemians. At the depths of scooter un-popularity, these people cherish the individualism, cheapness, and novelty of the scooter, and tend to create small communities around them. There have been scooter clubs and scooter rallies as long as there have been scooters.

At certain times, for whatever reason (more often than not, economic instability and expensive gas), combined with the cachet lent to scooters by early-adopting hipsters and celebrities, and certainly bouts of nostalgia, sales take off, importers and dealers go nuts, everyone and their mom runs out and buys a scooter, and then the economy gets better and gas prices level off and everyone goes back to their Deusenbergs or Bel-Airs or DeLoreans or Hummers, putting the dealers and importers out of business, sending Piaggio back to Italy with their tails between their legs, and leaving the hipsters and tinkerers with a fertile, cheap supply of secondhand bikes to start building up the next boom.

Gotta split, coming soon: Part II, What Piaggio Hasn't Learned From This.

Bb.
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Post by ericalm »

illnoise wrote:Gotta split, coming soon: Part II, What Piaggio Hasn't Learned From This.
I'm really looking forward to this. :)

While scooters may seem like a sound investment, most scooter companies aren't. Genuine benefits greatly from being privately owned. When Stella production stopped a few years ago due to a strike in India, Genuine was able to take the time to identify and negotiate deals with another quality manufacturer. A public company may have been sold off or simply shuttered.

If you read 2StrokeBuzz or some of the other scooter blogs, you'll quickly realize that many scooter companies—manufacturers, importers, whatever—are poorly organized and managed or have their focus elsewhere in the world so aren't poised to take advantage of a boom in the U.S. or prepared for an eventual bust. (I'm not sure the boom is peaking quite yet...) I wouldn't bank on any of them!
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Post by schlagle »

illnoise wrote: Gotta split, coming soon: Part II, What Piaggio Hasn't Learned From This.
Looking forward to it!

And not to date myself but I was part of the 80's scooter boom. But for the life of me I can't remember what my scooter was! I was too unaware to realize that I was participating in a boom, but everyone I knew had one back then. It's funny to look back and realize that there was more too it than just me wanting a scooter.
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Post by illnoise »

Allright, I lost my train of thought, where was I…

Piaggio has had many international ups and downs that of course have much more impact on the company than American ups and downs. Even this huge boom here is a tiny dent of their production compared to their (currently sagging) other markets.

The Italian motor industry is, and has always been, pretty weird. Most of the marques were started as a family business, then through the 60s/70s/80s, many of them went out of business, then were bailed out by the government, then were bought and sold and merged, over and over. In the 80s and early 90s, Piaggio has merged and demerged and been bailed out and bailed out other companies several times. It's a very volatile market. Most recently, Colaninno holding company bought them from the Agnelli family, and acquired Derbi and Guzzi (they already owned Gilera), and they went public recently. That situation is unlikely to last, chances are they'll eventually buy back the stock, or get bought out, or something. Colaninno will get rich, a new owner will brag about a new era for Piaggio, and then they'll cut costs and America will be the first thing to go. They've been talking about a new museum and new plants in Vietnam and Brazil to serve foreign markets, but that hasn't happened yet. Meanwhile, many other european marques (Benelli, Italjet, Puch) are little more than a licensing deal with Chinese factories. That could be Piaggio's future.

In short, they're really unpredictable, even in the international market.

In the U.S., it's worse. They always seem to show up, destroy the existing dealers and community, ignore agreements with earlier distributors and set up a new network, then demand too much of their dealers, ignore their customers, ship us year-old bikes that didn't sell in europe and bring over new models long after the luster is gone, then ride out the wave of popularity, and then close up shop and go home, leaving dealers hanging.

This time, they imported them themselves rather than using a U.S. distributor, which was a fine idea except they've just been ridiculously poorly managed, they've burnt through a few president/ceos, they've moved headquarters, switched PR companies and ad companies a few times, tried dozens of marketing ideas that weren't bad, but each was totally abandoned halfway through... They're just not very well run. Dealers love having Vespas to draw in customers, but the majority of their own dealers are very unhappy with PiaggioUSA. Dealer margins on their bikes are low, and dealer requirements and expenses are high.

The center of the problem is that they can't see the cyclical nature of the market, and they're not willing to make a long-term investment in America. Instead of looking down the road and seeing what it would take to make scooters viable in the U.S., then investing and slowly growing to a sustainable level, they're playing catch-up with trends. They came to America in 1999 and positioned their bikes in expensive boutiques and targeted yacht club regattas and golf tournaments and internet millionaires, just after the dot-com bust. At that point, the "boom" was just getting started in the subculture and colleges, and they totally ignored and even antagonized that market, they sued people that had been keeping their old bikes on the road during their absence and blew off tens of thousands of current scooterists that were begging to evangelize for the "new Vespa" for as little as a few rally raffle donations. They used the history and the subculture of the Vespa to sell bikes, but when real scooterists showed up at shops, they shoo'ed us away. (there were a couple exceptions, of course, at the dealer level, and those are the handful of original 1999 dealerships that still exist today)

Several CEOs and marketing directors later, PiaggioUSA is still barely supporting the VCOA or doing anything to develop a national scooterist infrastructure (their support is appreciated, but it's nothing compared to how they supported FIV and European clubs). Internationally, it's worse, FIV was dissolved to start a more "company-owned" club, World Club Vespa, which is even more poorly organized and underfunded than the FIV (a semi-private endeavor) was.

Meanwhile, PiaggioUSA's sole directive is to get bikes to dealers and collect the money. Profit is their only motive, and they have no interest in the end consumer, really. Their originally-strict boutique format was completely abandoned in the interest of adding as many dealers as possible, be it on Rodeo Drive or in a Farm and Fleet in Minnesota. They refocused their marketing from exclusivity to an economy message that was working really well for every other scooter manufacturer, sadly, their bikes get worse gas mileage than just about any other scooter, and cost twice as much. Sure, they're selling pretty well because there are always people spending money to save money, but it's not sustainable growth by any means, and when they hit the ceiling (they probably already have), they're not going to be able to report record growth and profits to headquarters, and they'll see that as "the end of the boom" and close down shop.

Many Vespa/Piaggio DEALERS are fantastic, developing a great scene in their area and planning for the future, those dealers will be around longer than Piaggio, they'll keep the name alive after Piaggio leaves, and they'll probably get sued or forced to change their names the next time Piaggio sees a boom coming. Many Vespa/Piaggio dealers are clueless, but they'll just keep on selling Bentleys and Ferraris (or horse meds and Rototillers) and they'll be fine.

Genuine, on the other hand, KNOWS the american market, and they know they're not going to be selling 10,000 scooters a year every year. They've prepared for the inevitable slowdown, they're not ordering more bikes than they know they can sell, they've developed their own higher-margin accessories and focused on dealer sales AND consumer sales of parts and services outside their own line of bikes. They were fine before the boom, and they'll be fine after it, because they're building a good network of "scooters first" dealers who will be repairing these beasts for years to come. They're not entirely dependent on PGO or LML (LML's labor problem was probably what provoked them to import the Buddy in the first place.)

So that's all pretty stream-of-consciousness and not very well organized or referenced, but that's the gist of it.
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Post by jmazza »

illnoise wrote: Genuine, on the other hand, KNOWS the american market, and they know they're not going to be selling 10,000 scooters a year every year. They've prepared for the inevitable slowdown, they're not ordering more bikes than they know they can sell, they've developed their own higher-margin accessories and focused on dealer sales AND consumer sales of parts and services outside their own line of bikes. They were fine before the boom, and they'll be fine after it, because they're building a good network of "scooters first" dealers who will be repairing these beasts for years to come. They're not entirely dependent on PGO or LML (LML's labor problem was probably what provoked them to import the Buddy in the first place.)
Illnoise, this is a super cool read for someone new to scootering. Thanks for taking the time to write it- it may be stream of consciousness but very informative!

It's good to hear you talk about Genuine the way you do... I've read quite the opposite on another board, specifically by someone who works at a scooter shop, saying that the way Genuine has been operating looks like they are in it to jump on a bunch of new scooter sales and then bail. It has to do with their antiquated parts ordering methods (three-ring binders instead of computerized parts locator) as well as their easy supposed three-scooter buy in to become a dealer.

I feel that Genuine seems to have some growing pains (particularly in the parts dep't) but that should be expected. I can't imagine the guys at the top of Genuine who, from what I understand, have been in the business for quite a long time in some capacity, would be in it for a hit-it-and-quit-it fast buck.
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Post by schlagle »

Wow illnoise! Thanks for the article. Very intersting stuff.
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Post by illnoise »

jmazza wrote:I've read quite the opposite on another board, specifically by someone who works at a scooter shop, saying that the way Genuine has been operating looks like they are in it to jump on a bunch of new scooter sales and then bail. It has to do with their antiquated parts ordering methods (three-ring binders instead of computerized parts locator) as well as their easy supposed three-scooter buy in to become a dealer.
Yeah, that's fair to say, in a way. They certainly, as a scooter business, have profits as their first priority and it would be foolish for them to sit back and not rake in some cash during the boom, and that's exactly what they're doing. And it's fair to say they've had their problems and are a little backwards in many ways.

But I see that as a plus. They know their strengths and they know where it's worth putting money and where it's not. Their organization is pathetic by Honda standards, but it's a pretty-well-run medium-size business.

They're certainly not perfect, and it might even be fair to say that the Genuine side of the business is a little "get rich quick," but Scooterworks is the long-term meat of their business and it's safe to say that even if Genuine closes down, Scooterworks will offer a much higher level of parts supply and know-how than what you'll find with any defunct scooter brand.

For instance, Steve Guzman, who WORKS FOR ITALJET, was unable to find a wiring diagram for a model that's less than ten years old, the institutional memory of Italjet in italy was unable to help him out. God help you if you need parts for an early-00s Italjet or Malaguti, even though Malaguti's original importer is still in the scooter parts business. Scooterworks was sort of the epicenter of the vintage set during the lean years, and they'll still be around for the next lean years. They're all about sustainability, and looking at their current dealer-direct catalog, they're gearing up for it, with lots of parts and accessories for all makes and models of scooters. They have manufacturing resources and accessory (Prima) and performance parts (Malossi and NCY) connections. If there's any part with a good amount of demand, they'll make it themselves, eventually.
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Post by ericalm »

jmazza wrote:Illnoise, this is a super cool read for someone new to scootering. Thanks for taking the time to write it- it may be stream of consciousness but very informative!

It's good to hear you talk about Genuine the way you do... I've read quite the opposite on another board, specifically by someone who works at a scooter shop, saying that the way Genuine has been operating looks like they are in it to jump on a bunch of new scooter sales and then bail. It has to do with their antiquated parts ordering methods (three-ring binders instead of computerized parts locator) as well as their easy supposed three-scooter buy in to become a dealer.

I feel that Genuine seems to have some growing pains (particularly in the parts dep't) but that should be expected. I can't imagine the guys at the top of Genuine who, from what I understand, have been in the business for quite a long time in some capacity, would be in it for a hit-it-and-quit-it fast buck.
I'm certainly not here to be an apologist for Genuine and will be the first to recognize there have been some serious problems with parts availability and so on and there are occasional other missteps. But I guarantee you, they are really looking at being in this for a long haul. They're scooterists and I think nothing would make them happier to be able to just sell scooters until the end of time. They get excited about this stuff, and it's not just about sales—they love their products. I don't know that can be said of many other companies, which have CEOs who only sit on scoots for photo ops.

At the very least, Genuine has been remarkably honest and sincere for a company of any type.
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Post by illnoise »

Something interesting I forgot to mention (man, I hijacked the crap out of this thread):

The only attempt PiaggioUSA made to attract vintage scooterists was their "Vintage Vespa Restoration Program" Basically, any repair shop that wanted to use the Vespa name legally had to apply for "training" (not sure that ever happened) and promise to only stock OEM Vespa parts, which (surprise!) Vespa had just put out a luxe new catalog for (available at your Vespa dealer for a few bucks.) They reproduced about 25 things that would look pretty in a catalog, and charged twice or more as much for them as the equivalent parts that Scooterworks had been selling for ten years, along with the other 98% of the parts you might need to get a scooter running.

Of course, it stunk and it was entirely forgotten in a year or so. I don't think there's a scooter shop in America proudly displaying their "Vintage Vespa Restoration Center" logo on their website, and I bet Vespa dealers order more vintage parts (and probably modern parts, too) from Scooterworks than they do from Piaggio.
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Post by gt1000 »

Illnoise, thanks for taking the time and effort with these posts. Your second installment filled in some blanks for me. I also have some personal experience with a few of the Piaggio foibles you pointed out.

Vespa Boutiques! Perhaps the single worst shopping experience in my life. Walked in ready to buy a ET-2 (2002, maybe), walked out scratching my head in disbelief and went straight to Sportique. There's one youngish hipster working the entire boutique and my daughter and I are his only customers. He never moved from his desk and never got off the phone (personal call). He was totally bored and my interest in Vespas was clearly a distraction. No test drives, although one perhaps could be arranged on certain days of the week at their repair facility, which was miles away. The story behind Erico Motorsports acquiring the local Vespa franchise is not urban legend. When Erico's owner's wife tried to buy a Vespa at the boutique, she apparently got the same treatment. She and her husband talked it over and bought the franchise out from under the boutique.

The profit motive. Now that Piaggio is publicly owned, their primary responsibility is to their shareholders. Most shareholders are holding shares for one reason. Profit.

This brings me to BMW. Say what you will about their cars or motorcycles, the brains behind BMW are marketing geniuses, especially compared to Piaggio. BMW steadfastly remains independent and private, fending off takeovers and mergers over the course of the years. It allows them to really appeal to their fan base. And yes, the real success of BMW doesn't hinge on new owners, it's the fact that they continue to stroke the folks who have enthusiastically endorsed their products over the years. Services like Euro delivery, driving schools on various continents, riding schools, clubs, etc. all stroke the old enthusiast and develop new enthusiasts. Ducati certainly isn't anywhere near BMW's class in these areas but it's obvious they're learning from BMW, Lotus and Ferrari. Piaggio, with their stable of historic marques, would do themselves a huge service if they were simply smart enough to copy another success story like BMW.
Andy

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Post by jmazza »

Very cool info eric and bryan-

I certainly agree- Genuine seems to be in the business for all the right reasons and I feel very confident owning one of their products.
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Post by Piedmont »

Good write-up Illnoise!
Next can you explain why the Small Faces never made it big here? :lol:
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Post by jmazza »

Or why pudding skin singles never caught on as a snack item?
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Post by illnoise »

Piedmont wrote:Next can you explain why the Small Faces never made it big here? :lol:
They were just kind of inconsistent, imho, and never really had a hooky hit single like "My Generation" or "Satisfaction." Americans didn't understand the mod thing and probably saw them as a bit too "dandy," and they were maybe a little too devoted to the blues, like the yardbirds, where the who/stones were a little braver about expanding their sound into rock.

The Kinks were much better than the stones, the who, or the faces, but they were too dandy/english, too.

If Steve Marriott was the Who's singer instead of Roger Daltrey, they would have been invincible and the world would have imploded.
jmazza wrote:Or why pudding skin singles never caught on as a snack item?
Can't help you with that.
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Post by mlstephens »

On a somewhat related note, there was an article in the Wall Street Journal today about scooters, recent boom in interest and sales due to gas prices, etc. Pretty predictable article, but they had a nice chart comparing gas cost of an SUV versus a Vespa S over a year's time.
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Post by gt1000 »

The Kinks were much better than the stones, the who, or the faces, but they were too dandy/english, too.
Interesting timing, since I recently uncovered most of my old vinyl Kinks albums and have been listening to them non-stop. Ray Davies had (and still does) a way with words that was a bit quirkier than most of his counterparts and his brother Dave also had a knack for memorable, even gifted, guitar hooks.

I agree with your take on the Small Faces. While they never really hit it big, you can point to their genes being quite prolific in subsequent bands, just like the Yardbirds. The Faces provided the blueprint for Rod Stewart and Humble Pie while the Yardbirds did the same for Led Zep and Jeff Beck. Beck's early hookup with Rod Stewart ties it all together in a totally meaningless way.

And don't forget John Mayall's Bluesbreakers.

And now, back to our original double high-jacked thread...
Andy

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2009 Vespa 250 GTS (black)
2012 Triumph Tiger 800 (black)
2008 Ducati Hypermotard S, traded for Tiger 800
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