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INDUSTRY MARKET RESEARCH FOR BUSINESS LEADERS, STRATEGISTS, DECISION MAKERS CLICK TO VIEW

Table of Contents 2

List of Tables & Charts 3

Study Overview 5

Sample Text, Table & Chart 6

Sample Profile, Table & Forecast 7

Order Form & Corporate Use License 8

About Freedonia, Custom Research, Related Studies, 9

World Components

Industry Study with Forecasts for 2017 & 2022

Study #3061 | August 2013 | $5900 | 442 pages

The Freedonia Group 767 Beta Drive www.freedoniagroup.com Cleveland, OH • 44143-2326 • USA Toll Free US Tel: 800.927.5900 or +1 440.684.9600 Fax: +1 440.646.0484 E-mail: [email protected] Study #3061 August 2013 World $5900 442 Pages Industry Study with Forecasts for 2017 & 2022

Table of Contents Components...... 104 Eastern Europe...... 294 Other...... 106 General...... 294 Executive Summary Other Motorcycle Components...... 107 Motorcycle Component Supply & Demand... 295 Parts...... 111 Motorcycle Component Outlook & Suppliers 298 Filters...... 113 Africa/Mideast...... 301 Market EnvironmenT Exhaust & Emission System Components 114 General...... 301 All Other...... 116 Motorcycle Component Supply & Demand... 303 General ...... 4 Motorcycle Component Outlook & Suppliers 305 World Economic Overview...... 5 Recent Historical Trends...... 6 NORTH AMERICA World Economic Outlook...... 8 INDUSTRY STRUCTURE General ...... 118 World Demographic Overview...... 11 Motorcycle Component Supply & Demand...... 119 General ...... 309 Population...... 12 Motorcycle Component Outlook & Suppliers.... 122 Industry Composition...... 310 Urban Population...... 13 United States...... 125 Market Share...... 313 Households...... 15 Canada...... 132 Product Development & Manufacturing...... 317 World Personal Income Trends...... 17 Mexico...... 138 Marketing & Distribution...... 319 World Motorcycle Overview...... 19 Cooperative Agreements...... 322 Motorcycle Production...... 23 Mergers & Acquisitions...... 326 Internal Combustion ...26 WESTERN EUROPE Electric Motorcycles...... 29 General ...... 145 Motorcycles in Use...... 33 Company Profiles Motorcycle Component Supply & Demand...... 146 World Light Demand...... 37 Motorcycle Component Outlook & Suppliers.... 149 Akrapov dd...... 330 Legal & Regulatory Issues...... 40 Italy...... 153 Arrow Special Parts...... 331 Counterfeit Products...... 41 Germany...... 160 Limited...... 332 End of Life Requirements...... 43 Spain...... 166 Bayerische Motoren Werke...... 334 Restrictions Motorcycle Use...... 44 France...... 172 SpA...... 336 Rider Safety...... 45 United Kingdom...... 178 Corporation...... 338 Exhaust Emissions...... 47 Other Western Europe...... 184 China Jialing Industrial...... 340 Pricing Patterns...... 49 Chongqing Jianshe Motorcycle...... 341 Technological Trends...... 51 Chongqing Yinxiang Motorcycle...... 342 Internal Combustion Engine Motorcycles...... 52 ASIA/PACIFIC Chongqing Yujiang Die-Casting...... 343 Electric Motorcycles...... 53 General ...... 190 Chongqing Power Machinery...... 344 Motorcycle Component Supply & Demand...... 191 Continental AG...... 345 WORLD SUPPLY & DEMAND Motorcycle Component Outlook & Suppliers.... 194 Cooper & Rubber...... 348 China...... 197 Daelim Industrial...... 349 General ...... 55 India...... 204 Dayun Group...... 351 Regional Overview...... 56 Indonesia...... 210 LLC...... 352 Demand...... 56 ...... 217 EnerSys...... 353 Production...... 59 ...... 224 Exide Technologies...... 354 International Trade...... 62 Thailand...... 231 Giant Manufacturing...... 356 Demand by Market...... 64 Taiwan...... 237 Goodyear Tire & Rubber...... 357 Original Equipment Manufacturing...... 65 Pakistan...... 243 Haojue Holdings...... 359 Aftermarket...... 68 ...... 249 Harley-Davidson Incorporated...... 360 Demand by Product...... 72 Malaysia...... 255 Hero MotoCorp...... 362 Engine & Drivetrain...... 74 South Korea...... 261 Motor...... 363 Internal Combustion & Parts...... 77 Other Asia/Pacific...... 267 Hong Leong Industries Berhad...... 365 Electric Propulsion Motors...... 79 Jiangsu Xinri E-Vehicle...... 366 Drivetrain Components...... 81 Jiangsu Yadea Technical Development...... 367 ...... 83 OTHER REGIONS Jinfei Holding...... 368 Structural Components...... 87 Johnson Controls...... 369 ...... 90 Central & South America...... 274 Kawasaki Heavy...... 371 Frames...... 92 General...... 274 ...... 373 Suspensions...... 93 Motorcycle Component Supply & Demand... 275 KTM AG...... 376 Other...... 95 Motorcycle Component Outlook & Suppliers 278 Brazil...... 281 Electrical & Electronic Components...... 96 (continued on following page) Batteries...... 100 Other Central & South America...... 288 Lighting Equipment...... 102

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Table of Contents WORLD SUPPLY & DEMAND 26 World Motorcycle Exhaust & Emission System Parts Demand by Region...... 116 1 World Motorcycle Component Company Profiles 27 World Demand for All Other Motorcycle Demand by Region...... 58 Components by Region...... 117 (continued from previous page) 2 World Motorcycle Component Production by Region...... 61 Kwang Yang Motor...... 378 NORTH AMERICA Lifan Industry...... 380 3 World Motorcycle Component Loncin Motor...... 381 Net Exports by Region...... 63 1 North America: Motorcycle Component Luoyang North Enterprises...... 382 4 World Motorcycle Demand by Market...... 65 Supply & Demand...... 121 Michelin Group...... 384 5 World Original Equipment 2 North America: Motorcycle Component ...... 386 Manufacturing Motorcycle Demand by Type...... 124 Musashi Seimitsu Industry...... 388 Component Demand by Region...... 67 3 United States: Motorcycle Component MV Agusta Motor...... 390 6 World Aftermarket Motorcycle Component Supply & Demand...... 128 & C. SpA...... 392 Demand by Product & Region...... 71 4 United States: Motorcycle Component & C. SpA...... 394 7 World Motorcycle Component Demand by Type...... 131 Polaris Industries...... 396 Demand by Type...... 73 5 Canada: Motorcycle Component S&S Cycle...... 397 8 World & Supply & Demand...... 134 Sanyang Industry...... 398 Drivetrain Component Demand 6 Canada: Motorcycle Component Scandinavian Brake Systems...... 400 by Product & Region...... 76 Demand by Type...... 137 Motor...... 401 9 World Motorcycle Internal Combustion 7 Mexico: Motorcycle Component Tianneng Power International...... 403 Engine & Parts Demand by Region...... 79 Supply & Demand...... 141 Triumph Motorcycles...... 404 10 World Motorcycle Electric Propulsion 8 Mexico: Motorcycle Component Volkswagen AG...... 406 Motor Demand by Region...... 81 Demand by Type...... 144 Wanfeng Auto Holding...... 408 11 World Motorcycle Drivetrain Component ...... 409 Demand by Region...... 83 Other Companies Mentioned in Study...... 413 12 World Motorcycle Tire Demand WESTERN EUROPE by Market & Region...... 86 1 Western Europe: Motorcycle Component 13 World Motorcycle Structural Component Supply & Demand...... 148 Demand by Product & Region...... 89 2 Western Europe: Motorcycle Component List of Tables 14 World Motorcycle Demand by Type...... 152 Demand by Region...... 91 3 Italy: Motorcycle Component 15 World Executive Summary Supply & Demand...... 156 Demand by Region...... 93 4 Italy: Motorcycle Component 1 Summary Table...... 3 16 World Demand by Type...... 159 Demand by Region...... 95 5 Germany: Motorcycle Component 17 World Demand for Other Motorcycle Market EnvironmenT Supply & Demand...... 162 Structural Components by Region...... 96 6 Germany: Motorcycle Component 1 World Gross Domestic Product by Region...11 18 World Motorcycle Electrical & Demand by Type...... 165 2 World Population by Region...... 13 Electronic Component Demand 7 Spain: Motorcycle Component 3 World Urban Population by Region...... 15 by Product & Region...... 99 Supply & Demand...... 168 4 World Households by Region...... 17 19 World Motorcycle Battery Demand 8 Spain: Motorcycle Component 5 World Per Capita Gross Domestic by Market & Region...... 102 Demand by Type...... 171 Product by Region...... 19 20 World Motorcycle Lighting Equipment 9 France: Motorcycle Component 6 World Motorcycle Production Demand by Region...... 104 Supply & Demand...... 174 by Engine Type & Region...... 25 21 World Motorcycle Ignition System 10 France: Motorcycle Component 7 World Internal Combustion Demand by Region...... 106 Demand by Type...... 177 Engine Motorcycle Production 22 World Demand for Other Motorcycle 11 United Kingdom: Motorcycle by Type & Region...... 29 Electrical & Electronic Components Component Supply & Demand...... 180 8 World Electric Motorcycle Production by Region...... 107 12 United Kingdom: Motorcycle by Type & Region...... 33 23 World Demand for Other Motorcycle Component Demand by Type...... 183 9 World Motorcycles in Use by Components by Product & Region...... 110 13 Other Western Europe: Motorcycle Engine Type & Region...... 36 24 World Motorcycle Brake Part Demand Component Supply & Demand...... 186 10 World Light Vehicle Demand by Region.....40 by Market & Region...... 112 14 Other Western Europe: Motorcycle 11 Original Equipment Manufacturing 25 World Motorcycle Filter Demand Component Demand by Type...... 189 Motorcycle Component Cost by Region..51 by Market & Region...... 114 (continued on f0llowing page)

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List of Tables 5 World Motorcycle Component (continued from previous page) OTHER REGIONS Demand by Type, 2002-2022...... 74 1 Central & South America: Motorcycle 6 World Motorcycle Engine & Drivetrain ASIA/PACIFIC Component Supply & Demand...... 277 Component Demand by Region, 2012....77 2 Central & South America: Motorcycle 7 World Motorcycle Tire Demand 1 Asia/Pacific: Motorcycle Component Component Demand by Type...... 280 by Region, 2012...... 87 Supply & Demand...... 193 3 Brazil: Motorcycle Component 8 World Motorcycle Structural Component 2 Asia/Pacific: Motorcycle Component Supply & Demand...... 284 Demand by Region, 2012...... 90 Demand by Type...... 196 4 Brazil: Motorcycle Component 9 World Motorcycle Electrical & Electronic 3 China: Motorcycle Component Demand by Type...... 287 Component Demand by Region, 2012.. 100 Supply & Demand...... 200 5 Other Central & South America: Motorcycle 10 World Demand for Other Motorcycle 4 China: Motorcycle Component Component Supply & Demand...... 290 Components by Region, 2012...... 111 Demand by Type...... 203 6 Other Central & South America: Motorcycle 5 India: Motorcycle Component Component Demand by Type...... 293 Supply & Demand...... 206 7 Eastern Europe: Motorcycle Component NORTH AMERICA 6 India: Motorcycle Component Supply & Demand...... 297 1 North America: Motorcycle Component Demand by Type...... 209 8 Eastern Europe: Motorcycle Component Demand by Type, 2012...... 125 7 Indonesia: Motorcycle Component Demand by Type...... 300 Supply & Demand...... 213 9 Africa/Mideast: Motorcycle Component 8 Indonesia: Motorcycle Component Supply & Demand...... 304 WESTERN EUROPE Demand by Type...... 216 10 Africa/Mideast: Motorcycle Component 1 Western Europe: Motorcycle Component 9 Japan: Motorcycle Component Demand by Type...... 307 Demand by Type, 2012...... 153 Supply & Demand...... 220 10 Japan: Motorcycle Component Demand by Type...... 223 INDUSTRY STRUCTURE ASIA/PACIFIC 11 Vietnam: Motorcycle Component 1 Motorcycle Component Sales 1 Asia/Pacific: Motorcycle Component Supply & Demand...... 227 by Company, 2012...... 311 Demand by Type, 2012...... 197 12 Vietnam: Motorcycle Component 2 Selected Cooperative Agreements...... 324 Demand by Type...... 230 3 Selected Acquisitions & Divestitures...... 328 13 Thailand: Motorcycle Component OTHER REGIONS Supply & Demand...... 233 14 Thailand: Motorcycle Component 1 Central & South America: Motorcycle Component Demand by Type, 2012..... Demand by Type...... 236 281 15 Taiwan: Motorcycle Component 2 Eastern Europe: Motorcycle Component Demand by Type, 2012...... Supply & Demand...... 239 List of Charts 301 16 Taiwan: Motorcycle Component 3 Africa/Mideast: Motorcycle Component Demand by Type, 2012...... Demand by Type...... 242 308 17 Pakistan: Motorcycle Component MARKET ENVIRONMENT Supply & Demand...... 245 1 Typical Motorcycle Market Transition Points INDUSTRY STRUCTURE 18 Pakistan: Motorcycle Component for Selected Countries, 2012...... 22 Demand by Type...... 248 1 World Motorcycle Component 2 World Motorcycle Production Market Share, 2012...... 314 19 Philippines: Motorcycle Component by Region, 2012...... 26 Supply & Demand...... 251 3 World Motorcycles in Use 20 Philippines: Motorcycle Component by Region, 2012...... 37 Demand by Type...... 254 21 Malaysia: Motorcycle Component Supply & Demand...... 257 WORLD SUPPLY & DEMAND 22 Malaysia: Motorcycle Component 1 World Motorcycle Component Demand by Type...... 260 Demand by Region, 2012...... 59 23 South Korea: Motorcycle Component 2 World Motorcycle Component Supply & Demand...... 263 Production by Region, 2012...... 62 24 South Korea: Motorcycle Component 3 World Original Equipment Manufacturing Demand by Type...... 266 Motorcycle Component Demand 25 Other Asia/Pacific: Motorcycle Component by Region, 2012...... 68 Supply & Demand...... 270 4 World Aftermarket Motorcycle Component 26 Other Asia/Pacific: Motorcycle Component Demand by Region, 2012...... 72 Demand by Type...... 273

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The Asia/Pacific region, which has both the highest motorcycle production and the most motor- cycles in use, continue to dominate worldwide motorcycle component demand through 2017.

World demand to rise 7.5% annually through 2017 World Motorcycle Component China The global market for motorcycle Demand, 2017 components, including those for electric ($119.5 billion) (e-bikes) and - cycles (e-cycles), is forecast to expand 7.5 percent annually to $119.5 billion in 2017. The Asia/Pacific region, which has India both the highest motorcycle production and the most motorcycles in use, will Indonesia continue to dominate worldwide demand, representing four-fifths of total motor- Other Asia/Pacific cycle parts demand in 2017.

China to remain the Rest of World largest market by far Demand for OEM motorcycle parts is directly related to motorcycle production, whereas aftermarket demand is tied to the motorcycle park. Both output and Engine, drivetrain parts and suppliers rely on aftermarket parts stock are expected to grow as a result of sales for the bulk of their revenue. rising standards of living in developing to remain largest category nations. China will remain the largest Engine and drivetrain parts will remain Tires to be fastest growing national market by far, with India and the largest component product category Indonesia also important due to both of in dollar terms because they account for motorcycle component their large populations -- a large portion the greatest percentage of total parts The fastest growth among major motor- of which has the means to purchase costs, regardless of the model. Products cycle component categories will be inexpensive motorcycles -- and the large in this segment, as well as those includ- registered by tires, with the replacement size of their motorcycle manufacturing ed in the structural group, derive the vast market accounting for more than four- industries, which boosts associated majority of their sales from OEM applica- fifths of incremental demand from 2012 component requirements. As wages for tions. This is because almost all of these to 2017. Sales of electrical and electron- low income families rise in emerging parts have low replacement rates, as ic parts will climb at the second fastest economies, motorcycle ownership they are designed to last the useful life of rate, supported by growth in the motor- becomes an affordable and attractive a motorcycle. Tires and the products in cycle stock and rising output of e-bikes alternative to , riding a , or the electrical and electronic, and other and e-cycles, many of which use more utilizing mass transit, which triggers miscellaneous component categories, expensive batteries than those installed strong growth in motorcycle and after- tend to have higher replacement rates in conventional ICE motorcycles. market component sales. Copyright 2013 The Freedonia Group, Inc.

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Sample Text, CHART VIII-1

Table & Chart WORLD MOTORCYCLE COMPONENT MARKET SHARE ($83.2 billion, 2012)

13.8% H o n d a

M a rk e t O the rs Le a desa rs mple 6 6 .0 % 8.3% Yam ah a asia/pacific 3 4 .0 %chart 4.8% B rid g esto n e India: Motorcycle Component Outlook & Suppliers Demand for motorcycle components in India is expected to advance 3.9% H arley 9.3 percent per year to $19.4 billion in 2017, slowing from the double 3.2% B aj aj Au to digit annual growth of the previous 10 years but continuing to outpace the Asia/Pacific region in the aggregate. Market gains will be stimulated by increased motorcycle output and expansion in the motorcycle park, attributable to higher machine demand fueled by growth in household formations, personal incomes, and population. However, the availability and affordabilitysample of other means of personal transportation -- which in- clude light like the Tata NANO, mass transit systems, and com- TABLE VI-6 mercial threete xwheelerst -- will serve to dampen motorcycle and related parts sales moving forward. INDIA: MOTORCYCLE COMPONENT DEMAND BY TYPE (million dollars) In 2002, replacement component expenditures represented the majority of Indian product sales. However, as motorcycle production rose almost 14 percent per annum over the next 10 years, more thanItem 2002 2007 2012 2017 2022 double the rate of the motorcycle stock, OEM parts spending made up an increasing share of overall demand, representing 64 percent of theA/P sales Motorcycle Component Demand 26190 47896 65300 95250 135000 total in 2012. Although OEM expenditures are expected to take more % India 15.1 15.2 19.1 20.4 21.3 market share from aftermarket applications through 2017, the rate of growth will be much slower than the previous five years as the numberMotorcycle Component Demand 3944 7275 12450 19400 28700 of motorcycles in use accelerates from the 2007-2012 period and motorEngine- & Drivetrain: 1067 2334 4415 7005 10400 cycle output slows. Internal Combustion Engines/Parts 783 1801 3460 5570 8295 Electric Propulsion Motors 1 2 12 20 35 Due to strong growth in both motorcycle output and the motor - Drivetrain 283 531 943 1415 2070 cycle park through 2017, most component product categories will postTires 832 1317 1985 3110 4585 similar growth rates. Engine and drivetrain parts will remain the lar Structural:gest 574 1137 2060 3205 4680 category in value terms, nearly double the demand level for other miscel Wheels- 257 487sa mple850 1320 1925 laneous components, the second largest group. Gains will be driven byFrames 129 285 555 865 1275 the high percentage of total component costs that these parts account for,Suspensions 157 298t ab530 le820 1190 coupled with rising motorcycle production. Structural components will Other 31 67 125 200 290 continue to be the third largest category, with market increases spurred Electrical & Electronic: 644 1059 1620 2430 3570 Batteries 411 637 905 1355 2010 Copyright 2013 The Freedonia Group, Inc. 207Lighting Equipment 102 181 300 450 660 Ignition System 82 143 240 365 535 Other 49 98 175 260 365 Other: 827 1428 2370 3650 5465 Brake Parts 418 738 1235 1910 2845 Filters 251 369 520 745 1120 Exhaust & Emission 108 215 405 665 1010 All Other 50 106 210 330 490

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Sample Profile, TABLE III-11 Table & Forecast WORLD MOTORCYCLE DRIVETRAIN COMPONENT DEMAND BY REGION (million dollars)

Item 2002 2007 2012 2017 2022

World MC Drivetrain Comp Demand 3201 5077 6130 8595 11700 North America: 444 552 514 680 835 United States 421 514 446 572 688 Canada & Mexico 23 38 68 108 147 Western Europe 520 604 510 585 640 Asia/Pacific: 2060 3594 4625 6615 9200 China 553 1346sa mple1950 2700 3575 COMPANY PROFILES India 283 531 943 1415 2070 Indonesia 146 286tab 517le 840 1240 Other Asia/Pacific 1078 1431 1215 1660 2315 Arrow Special Parts SpA Central & South America 95 203 280 405 566 Via Citernese 128/130 Eastern Europe 30 32 41 53 64 06016 San Giustino Africa/Mideast 52 92 160 257 395 Italy 39-75-861-811 % drivetrain 24.9 23.9 24.3 23.8 23.3 http://www.arrow.it sample MC Engine/Drivetrain Comp Demand12836 21205 25250 36150 50150 Annual Sales: $15 million (estimated) Employment: 150 (estimated)pr ofile Key Products: exhaust systems, foot pegs, and dampers

Arrow Special Parts manufactures exhaust systems and other components for motorcycles. The Company is privately held. STUDY The Company’s motorcycle exhaust systems, which are available for original equipment manufacturer and aftermarket applications, in- COVERAGE clude on- and off-road, and types. On-road exhaust systems are sold through numerous product lines, including COMPETITION, GP2, This Freedonia study, World PRO-RACE, ROUND-SIL, STREET THUNDER, TROPHY, WORKS, Motorcycle Components, offers and X-KONE. For example, COMPETITION exhaust systems are historical data (2002, 2007, 2012) based on racing motorcycle exhaust systems and include full titanium versions and systems with stainless steel headers. Among Arrow plus forecasts for 2017 and 2022 Special Parts’ off-road exhaust systems are ALL-ROAD 2T products, for motorcycle component supply which are intended for two-stroke motorcycles and are constructed and demand, as well as demand from reduced thickness metal sheets. For scooters, the Company makes EXTREME, LIMITED SERIES, MAXI SCOOTER, REFLEX, by type (engine & drivetrain, tires, and STREET exhaust systems. Other motorcycle components from the electrical & electronic, structural, Company include foot pegs and steering dampers. other). The study also assesses Arrow Special Parts conducts manufacturing activities in San key market environment factors, Giustino, Italy. The Company’s products are sold via a network of evaluates company market share dealers in Europe; the Asia/Pacific region; the Africa/Mideast region; and profiles 52 players in the global 166 Copyright 2013 The Freedonia Group, Inc. motorcycle component industry.

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