PowerNewsTM www.npauctions.com VOLUME 9 • APRIL 2016 VIBRANT V-TWIN 2016 MARKET REVS UP! Harley-Davidson came out swinging for 2016 with the most powerful collection of cruisers in the brand’s 113-year history. In a further show of strength, the Harley-Davidson, Inc. (NYSE: HOG) Board of Directors approved a 35 cent per share cash dividend for the first quarter of 2016 — an increase of 12.9% compared to the 2015 Q4 dividend of $0.31 per share. This dividend was paid on March 4, the day after the Indian Springfield unveiling. Coincidence? Perhaps not. The Board also authorized the repurchase up to 20 million shares of Harley- Davidson common stock (this is in addition to the existing share repurchase authorization the Board Spring has sprung and the V-Twin sector is displays in Daytona are the perfect place to see approved back in June 2015. As of the end of revving up! Harley-Davidson stock is paying how we’re pushing the performance envelope.” 2015, 9 million shares remained on that share dividends, Indian is on the warpath and Victory Coinciding with Polaris' Victory party is the repurchase authorization). is on the gas with the launch of the Octane. Indian uprising. Indian invited race fans to witness In October, Harley doubled down by unveiling After appearing to go into hibernation in Q4, the the Roland Sands Design Super Hooligan Indian plans to increase its customer-facing marketing big V-Twin industry is back on the throttle. The Scout Sixty dirt trackers in action during Daytona 65% and boost investment in new product V-Twin Expo in February and the unofficial kickoff Bike Week. Following on the heels of IV League Flat development by 35%. Approximately $70 million to 2016 at Daytona Bike Week demonstrate the Track races in California, the RSD Super Hooligan is being invested to drive demand, focused in four V-Twin market is back with a vengeance. Polaris Indian Scout Sixty race bikes went on tour leading areas: increasing product and brand awareness; plans to prosper with new offerings from Victory up to Daytona, with races at The One Show and growing new ridership in the U.S.; increasing and and Indian, but they have a long way to go to Mama Tried events. enhancing brand access; and accelerating the topple The Motor Company, who is investing $70 As if this weren't enough, Indian announced cadence and impact of new products. million into retaining the title. their new Springfield. AsCycle World magazine "We are focused, with strength and resolve, on Where better to fire a shot across the V-Twin quipped: "Attention Road King, someone wants growing demand and building on our substantial industry's bow than at the 75th Daytona Bike your throne." CW Editor-In-Chief Mark Hoyer says, market leadership position," said Harley CEO/ Week bash? After unveiling the Octane and "Clearly, Indian has observed the highly successful President Matt Levatich. "Although we expect Stealth model Victory motorcycles to dealers model-proliferation playbook developed in the macro-economic environment to remain and the media, Bike Week witnessed a Milwaukee. As well it should. The core product challenging, we are confident we'll continue to lead substantial public push on the reinvigorated from Indian is well designed and engineered, with our powerful brand – not simply because of our brand. Add the Hooligan Indian Scout Sixty dirt making the work to produce more good models substantial strengths, but through our increased trackers rolling into the beachside biker's mecca from the basic platforms relatively straightforward. demand-driving investments and our incredibly and it is clear that Polaris planned to crash what The Springfield is one of those good models." talented and passionate employees and dealers." had been basically a private party for Harley Taking Stock Of The Situation In a branding tour de force, Harley-Davidson for decades. Throw in the launch of the new So is The Motor Company worried about abdicating celebrated the 75th anniversary of Daytona Bike Springfield model targeted right at the Harley their V-Twin crown? The answer would appear to Week in style with custom bike shows, demo rides Road King and an AMA Pro Flat Track racing be a definitive and resounding "NO!" and a special outreach to those on the front lines. legal 750cc powerplant announcement and it looks like the Indian vs. Harley rivalry is back! see VIBRANT V-TWIN MARKET p2 “Bike Week kicks off the riding season and serves as the perfect place to showcase our modern American muscle with the all-new IN THIS ISSUE Victory Octane – the lightest, most powerful and quickest Victory Motorcycle ever produced,” VIBRANT V-TWIN MARKET MOTORCYCLE SALVAGE BILL says Steve Menneto, President of Motorcycles EDITOR’S NOTE -THINKING AHEAD MEDIA - POWERSPORTS FINANCE for Polaris Industries. “Victory’s goal this year is to highlight the outstanding performance of all EFG - CERTIFIED PRE-OWNED PROGRAM CALENDAR - UPCOMING AUCTIONS of our models, and Victory’s activities and BUELL IS BACK - EBR RETURNS NPA ON THE MOVE - DESERT TRIP continued THINKING VIBRANT V-TWIN MARKET from cover AHEAD At a venue known for speed – Daytona the riding season kicks into overdrive during By Jim Woodruff International Speedway – they took a moment Daytona Bike Week," says show producer and to slow down and say “thank you” by inviting a founder Jim Betlach. "We just give the industry Spring is my favorite time of group of military personnel and first responders what it is asking for." year: the days are longer, to take an unforgettable ride around the “World "The show reflects the size of the industry," the air is warmer, and retail Center of Racing” during Bike Week festivities. he explains. "Nothing more, nothing less." A traffic is increasing as buyers This parade lap is just the start of free training true microcosm of the market, the show has are shaking off winter. Over for military and law enforcement professionals expanded and contracted during the sometimes the next 3-4 months most as a way to get more enthusiasts on bikes. turbulent ride since 2000. "During the chopper dealerships will do a majority of their annual sales. Now through the end of 2016, all current and craze when we had dozens of aftermarket The spring selling season brings a lot of trade-in, former U.S. military, and first responders, frame makers and specialty OEMs like Big Dog, Craigslist and eBay opportunities because the retail including law enforcement officers, firefighters American IronHorse, two different Indians and market is strong and consumers are motivated. Yet and EMS professionals are invited to learn to the like, the show expanded." When the chopper all too often we experience dealers who purchase ride for free through Harley-Davidson’s Riding craze crashed and the overall market tanked in units at spring prices only to end up selling later at Academy program. 2008, the show contracted accordingly. However fall prices. Besides the loss in value, those units “Our offer of free motorcycle training for all the date and the location stayed constant, again also take up floor space and capital during the U.S. Military and First Responders is all about based entirely on what the market wanted. busiest transactional months of the year. expressing our appreciation for their service, so "We don't do anything crazy, we just do what One way to expand margin and inventory they can enjoy more of the freedom they work the market wants," adds Betlach. The good news management beyond your peak season is by so hard to protect,” said Dino Bernacchi, Harley- is that the market wants to expand in 2016. Of investing in your pre-owned product with a one- to Davidson U.S. Marketing Director. “We’re the 200+ exhibitors on the floor plan, better than two-month-ahead mentality. By pricing purchases honored all of these riders joined us today. 10% are first-time exhibitors, including big guns for the future rather than today, you can be What a great way to celebrate 75 years at from the automotive market like MagnaFlow competitive but less prone to future downside. Daytona Bike Week, kick off riding season, exhausts and Red Line Oil. "New players Thinking ahead during the purchase makes it and salute those who help protect everyone’s are always good to have in the game and it easier to retail units at a discount if needed. Thinking personal freedom.” reflects that the V-Twin market is continuing to ahead also makes it less painful for any units that go rebound… 10% growth is well ahead of national straight to auction - or that eventually get wholesaled Showtime! average and most other segments of the or auctioned later if they sit more than 90-120 days. Guests were also invited to throw a leg over powersports market. Below are six suggestions to help your Summer, Fall Harley’s newest bikes – the CVO Pro Street and Winter be as good as your Spring. Breakout, the Low Rider S, and the Road Glide Boom Goes The Bottom Line! Ultra with its clean sheet design - and all available According to the latest MIC data (see MIC • Take every trade you can and either retail it, or for demo rides in Daytona. Snapshot on page 4) all on-highway motorcycle promptly wholesale it via auction as-is While the OEMs’ jockeying for position took sales were up 6.4% through the end of 2015, • Buy trade-ins and off the street purchases with the center stage during Bike Week, the aftermarket while the total motorcycle market (dirtbikes, likely future wholesale auction value in mind got to see the opening act at the annual V-Twin dual purpose and scooters combined) was up • Use NPA Value Guide to get current values, then Expo weeks before Daytona. For nearly two 4.7%. V-Twin Expo's growth and overall strength adjust downward depending upon how long you decades, V-Twin Expo has brought together of the V-Twin sector are definitely ahead of the might hold the unit. Remember that wholesale business-minded industry professionals each curve! Add in the innovative new product Polaris pricing is generally higher in spring and less in February to network, collaborate and exhibit is bringing to the party and Harley's investment late-summer through winter. the latest products for the V-Twin market. of $70 million into engaging new riders, and the • Adjust your inventory turn times – turn faster in Spring "Dealers want to see what's new right before domestic V-Twin market is on the fast track! (45-60 days) and slower in fall-winter (90-120 days) • Adjust retail pricing after 25 days and again at 35 days, then wholesale via auction after your age limit motorcycles purchased by dealers from NPA • Check your inventory against NPA Value Guide at EFG COMPANIES with an overall NPA Condition Report score least once per month and promptly liquidate slow CERTIFIED PRE-OWNED PROGRAM of 75 or higher will automatically be eligible movers as well as units that are depreciating quickly for the program (brand, year, mileage, engine, EFG Companies, an industry innovator of transmission and frame score limits apply). By following these six suggestions you can avoid consumer and vehicle protection programs, All vehicles are pre-qualified so no additional being stuck with too much inventory and too announced the launch of a Certified service inspection needs to be completed much money invested to liquidate. Thinking ahead Pre-Owned Program designed specifically by the dealer. lets you enjoy your spring – and the rest of your year for powersports dealers “As the powersports Dealers purchasing a CPO-eligible as well! market continues to recover, we know motorcycle can simply opt-in to EFG’s dealerships need showroom traffic now,” CPO program to retail the motorcycle as said Glenice Wilder, vice president of Certified Pre-Owned and market it to retail CONTRIBUTORS powersports, EFG Companies. “Our CPO customers. Based on a recent third- program provides dealerships with an party survey, 63 percent of powersports immediate means of capturing market share consumers place a higher value on CPO based on current consumer drivers. We are motorcycles by $500 to $1000. NPA San Diego, 12400 Stowe Drive • Poway, CA 92064 motivating customers to a make a purchase Wilder also stated, “A program like this TOLL FREE 1.888.292.5339 • Fax 858.513.1599 based on value that they can only get with is perfect for an independent dealer © 2016 National Powersport Auctions a strong CPO program, and our relationship who wants to add value to their inventory SENIOR EDITOR ...... Robin Hartfiel with NPA makes it easy for dealers.” without the hassle of performing their own PRODUCTION EDITOR ... Jim Woodruff EFG’s CPO program provides consumers inspections. This program increases buyer ART DIRECTOR...... Efraim Manuel with complimentary limited powertrain confidence and has customers coming MANAGING EDITOR ...... Ryan Keefe protection on name-brand pre-owned back again and again.” SECTION EDITOR ...... Sara Spohr motorcycles. As an added benefit, SAN DIEGO • DALLAS • CINCINNATI • ATLANTA VOLUME 9 • APRIL 2016 • NPA POWERNEWS • WWW.NPAUCTIONS.COM • P2 EBR RETURNS FAST VIBRANT V-TWIN MARKET BUELL IS BACK WITH AN AUCTION MOTORCYCLE TRACKED TO SALVAGE BILL SUCCESS

Tennessee title trouble will soon be a thing of the past. SB 1994 009256 by Senator Ketron and HB 1450 009256 by Representative Kane, closed a loophole in the law that applies to salvage, nonrepairable, rebuilt, and flood vehicle certificate of title requirements. The new law amends TCA Section 55-3-211 by appropriatly including motorcycles in the state's definition of a vehicle. This bill passed just before the spring recess and is just waiting for the Governor’s signature. "What the legalese means is that the state of Tennessee inadvertantley allowed for insurance companies to take advantage of a loophole to not disclose salvage on motorcycles," explains Al Sands, NPA's Director of Customer Care, who worked tirelessly with HDFS, the Motorcycle Industry Council, local dealers and insurance underwriters to clear things up. "Basically they did not have to brand motorcycle titles as salvage.

NPA Regional Sales Manager, Tony Avello, with Erik Buell, Bill Melvin Jr., and Bill Melvin Sr., the new owners of EBR Motorcycles at the reborn EBR Plant in East Troy, WI. They are standing with the first bike off the production line that will be auctioned off for charity, with the proceeds going to military veterans. After being brought back to life when “Working with Erik and EBR to develop an Bill Melvin of Liquid Asset Partners innovative superbike like the 1190 is just bought EBR at a bankruptcy auction, it is an amazing experience,” said Dan Hurda, appropriate that the first new bike be auctioned Director of Engineering. “And on top of that, off. EBR Motorcycles is planning to auction we are working on so many other exciting serial #1 and donate the proceeds of the first designs for the future. It’s the kind of job American patriotic bike to a national charity every kid who goes to engineering school that assists American military personnel dreams of.” and veterans. Dealers interested in selling EBR Did somebody say auction? NPA Regional Motorcycles should contact Sales@ Sales Manager Tony Avello was on hand LiquidAP.com to receive an information for the official re-launch of the EBR brand packet on becoming an EBR dealer. Anyone and to offer assistance with the planned interested in more information about the charity auction. EBR Motorcycles partnership, investment “The launch of EBR Motorcycles in 2016 is opportunity, or purchasing assets that are very exciting for American motorcyclists and in excess to current production should the Buell Nation around the globe,” states visit www.LiquidAP.com. As you can imagine this exposes the consumer Bill Melvin. “The team at EBR is top-notch when they have a clean title but a salvage record and they have worked enthusiastically on the vehicle. It left innocent parties with an towards this day. It’s a great day for America. asset that was misrepresented… and worth far America can succeed in manufacturing a NPA CALENDAR less to re-sell." high-performance sportbike that competes "As a franchised motorcycle dealer in with the fastest motorcycles in the world. the state of Tennessee representing The excitement over EBR from riders is stunning, Harley-Davidson, Indian Motorcycle and and dealers are quickly expressing their Victory Motorcycle, I feel strongly that this bill interest in being an EBR dealer. EBR is ready is monumental when it comes to protecting to twist the throttle and enjoy the ride!” consumer rights," says Ricky Kelley of Harley- Founder and CTO, Erik Buell said, “We Davidson of Columbia Superstore. "A service like are glad to see the talk all over the Internet CarFax or InstaVIN tells the consumer about an and Facebook about the launch and automobile's history, and when auto titles should those coming to the Launch Party event. be branded as 'SALVAGE' — the motorcycle It is always fun to meet riders in person, that’s consumer deserves to buy with the same what brings joy to the job!” confidence that a motorcycle has no salvage For 2016, EBR Motorcycles is focused history." A similar challenge exists for dealers on their restructuring, as well as updates in Illinois and a letter has been sent to on their 2017 models and development of Illinois Senator John J. Cullerton in hopes of 2018 motorcycles and future innovations. circumventing the issues there. Legal eagles EBR Motorcycles will continue to work can get all the details at: closely with its race sponsors and privateer www.wapp.capitol.tn.gov/apps/BillInfo/ race teams - who are succeeding in racing Default.aspx?BillNumber=HB1450 EBRs worldwide. VOLUME 9 • APRIL 2016 • NPA POWERNEWS • WWW.NPAUCTIONS.COM • P 3 POWERSPORTS OVERVIEW & SNAPSHOT MEDIA WATCH FINANCE MIC SNAPSHOT THROUGH DEC 2015

“There’s no wholesale financingThe 2015 total new retail sales numbers are in and the news is available for our dealerships.” “We good. The motorcycle market continued its incremental growth, can’t find retail financing for our ending up 3.6% last year with more than half a million new customers.” We’ve all heard comments motorcycles being sold. The Motorcycle Industry Council (MIC) like these, but where can we go to final numbers for Q4 show total on-highway sales of nearly learn and share more information? 351,000 units, up 4.9% over 2014. Dirt bike sales were also up www.npauctions.com When GE Commercial Distribution 1.9% in 2015 and dual-purpose bikes increased 7.8%. Much Finance announced their shift to more detailed figures, including make and model breakdowns Wells Fargo and Capital One decided are available to MIC members, as is their comprehensive to exit the space last year everyone Statistical Annual. Every powersports dealer should become wondered who would take their place an MIC member and enjoy access to much of the same data and help the OEMs and dealers provide and information as the OEMs, including snapshots like this the necessary financing Given one. For more details on the benefits of MIC membership, visit everything going on in the industry www.membership.mic.org during the past year, the need to know has never been greater. Enter PowerSports Finance. “PowerSports Finance is produced by Royal Media, the same company behind the auto finance industry’s leading publication,Auto Finance News, and premier industry event, the Auto Finance Summit,” explains JJ Hornblass, Executive Editor/Publisher. “The goal is to fill the information void from a financing perspective.” PowerSports Finance came to fruition last summer when Auto Finance News polled lenders and found a significant portion of the institutional DECEMBER 2015 2015 2014 UNIT PERCENTAGE lenders serving the automotive market were looking for more information VEHICLE TYPE GENERAL TYPE CURRENT PRIOR CHANGE CHANGE about powersports. Subsequently, they hosted the Inaugural Powersports ATV ATV 27,435 28,518 -1,083 -3.8 % Finance Summit in Las Vegas last October. Although there is a long road MOTORCYCLE DUAL 2,351 2,129 222 10.4 % ahead of them, they are steadily producing new stories and information MOTORCYCLE OFF-HWY 11,877 12,049 -172 -1.4 % about powersports every day. MOTORCYCLE ON-HWY 15,317 16,615 -1,298 -7.8 % “PowerSportsFinance.com is the first news outlet to focus solely on MOTORCYCLE SCOOTER 1,622 1,668 -46 -2.8 % MOTORCYCLE TOTAL 31,167 32,461 -1,294 -4.0 % the powersports lending market,” adds Hornblass. “It offers industry GRAND TOTAL 58,602 60,979 -2,377 -3.9 % professionals the first dedicated forum to share insights, best practices and practical intelligence on the financing of motorcycles, ATVs, jet skis, RVs and other specialty vehicles.” 2015 YEAR-END In addition to PowersportsFinance.com, Powersports Finance Quarterly 2015 2014 UNIT PERCENTAGE VEHICLE TYPE GENERAL TYPE CURRENT PRIOR CHANGE CHANGE was just launched. The digital magazine, daily e-newsletter and website are ATV ATV 228,380 229,552 -1,172 -0.5 % available to new and current subscribers. MOTORCYCLE DUAL 36,917 34,249 2,668 7.8 % “The team at Powersports Finance are making strides at bridging the MOTORCYCLE OFF-HWY 82,844 81,261 1,583 1.9 % knowledge gap between the auto and powersports industries. Subscribe MOTORCYCLE ON-HWY 350,869 334,488 16,381 4.9 % to their mailing list and receive daily e-newsletters and the quarterly print MOTORCYCLE SCOOTER 30,065 33,528 -3,463 -10.3 % publication. You can also join the PowerSports Finance community on LinkedIn MOTORCYCLE TOTAL 500,695 483,526 17,169 3.6 % and Twitter. Visit www.powersportsfinance.com for more information. GRAND TOTAL 729,075 713,078 15,997 2.2 %

DESERT TRIP TO NPA ON THE MOVE GORDONS WELL SAND DUNES

Another year had come and gone and another sand-filled getaway with NPA friends and family was in need. A caravan of ~30 adventurers rolled out Friday night and made the trek to Gordons Well Sand Dunes just East of El Centro, CA. A weekend of fun under the sun was had by all! Thankfully there were no broken bones - just a few damaged egos and mangled toys. Luckily, Vey’s Powersports had a test day set up no more than a football field away and a few fortunate souls got to test drive the new Yamaha YXZ1000. So how does this compare to other side-by-sides? Two words: Manual Transmission. This helps fuel economy, connects horsepower to the ground and adds to the overall excitement of driving a side-by-side. All in all it was another great weekend trip and we all lived our passion for the powersports.

VOLUME 9 • APRIL 2016 • NPA POWERNEWS • WWW.NPAUCTIONS.COM • P4