PowerSports Business

March 13, 2017

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FINANCIAL Aaron, Bell International will serve as the exclu- sive agent for Excelsior-Henderson Motor- cycles to seek a strategic relationship for the reintroduction of the brand to the marketplace. "We look forward to working with Excel- sior-Henderson during this exciting time in America, with the resurgence of manufacturing pride and interest in motorsports," said Ralph Bellizzi, founder and president of Aaron, Bell International. The convergence of several market factors has created a unique opportunity to reignite the heritage-rich Excelsior-Henderson brand. Recent motorsports industry reconfigura- tion, with Polaris Industries ending produc- tion of Victory Motorcycles to focus on its historic Indian Motorcycles, and Arctic Cat's sale to Textron, combined with the strength of American motorcycle manufacturing and sales worldwide, make the market ripe for the reemergence of the venerable "E-H" marque. Excelsior-Henderson's deep, rich heritage is what elevates this opportunity well beyond the ordinary. As one of the original "Big 3" OEM motorcycle manufacturers along with Harley- Davidson and Indian during the early decades of motorcycling, Excelsior-Henderson's heri- tage includes owners Henry Ford and Charles Lindbergh, and a long list of firsts, being the first motorcycle to circumnavigate the world and officially clocked at over 100 mph, to engi- neering and design innovations until ceasing production by owner Ignatz Schwinn of Chi- cago during the Great Depression. In the 1990s, that engineering and design legacy was painstakingly carried forward with the rebirth of the brand and the development of a proprietary, new Super X motorcycle by the Excelsior-Henderson Motorcycle Manufactur- ing Company. The company produced nearly 2,000 motorcycles featuring dual overhead cams, four valves per cylinder, closed-loop fuel injection, integrated cassette transmissions, anti-dive sus- pensions and more. Owners of the motorcycles today are just as fervent about the brand as the day they rode them off dealers' lots. Despite discontinuing production in late 1999, the business opportunity remains rela- tively turnkey due to its intellectual property and intensely-loyal, active customer base. Bellizzi said it's impossible to overstate the unique opportunity this presents. "An offering like this is extremely rare. An entrepreneur or investor can essentially pick up where the previous company left off, bypass the most difficult barriers to entry and build upon the established success of this heritage-rich brand in a highly lucrative industry," he said. "It's literally a once-in-a- lifetime opportunity." PSB 8 • March 13, 2017 • Powersports Business www.PowersportsBusiness.com Excelsior-Henderson reintroduction gets support STOCK MARKET WATCH Stock Price Percent Company Ticker 2/22/17 Change Arctic Cat, Inc. ACAT $18.51 40.7% MarineMax, Inc. HZO $23.50 30.6% Spy Inc. XSPY $0.06 20.0% ArvinMeritor ARM $16.44 19.3% Cooper Tire & Rubber CTB $41.53 18.3% General Electric Co. GE $30.29 -0.8% Carlisle Companies CSL $105.65 -1.7% Harley-Davidson, Inc. HOG $57.24 -2.4% ARI Network Services, Inc. ARIS $5.13 -5.0% TCF Financial Corporation TCB $17.60 -5.0% POWERSPORTS BUSINESS WINNERS AND LOSERS See Digest, Page 10 MARKET WATCH Change 2/22/17 from 1/20 % Change Powersports Business Index 264.351 12.23 4.85% Dow Jones Index 180.490 8.04 4.66% S&P 500 Index 160.687 4.10 2.62% Source: Wells Fargo Securities LLC 0 50 100 150 200 250 300 6/17/16 7/22/16 8/12/16 9/9/16 10/14/16 11/7/16 12/2/16 12/30/16 1/20/17 2/22/17 PSB INDEXED VALUE DOW JONES INDEXED S&P 500 INDEXED STOCK MARKET ACTIVITY DEALER FINANCIAL SNAPSHOT JANUARY 2017 Same Store Sales from 1,603 CDK Lightspeed dealers were up 0.5 percent overall in January 2017 versus the same period in 2016. Parts and service departments saw overall increases nationwide. The West was the only region that experienced an increase in all four categories and was up 3.8 per- cent overall. The Northwest was down 4.0 over- all, and decreased by 12.2 percent in service and 5.7 percent in major units. PARTS SALES 853 dealers were up in parts, while 750 were down. SERVICE SALES In service, 819 dealers were up and 754 were down. MAJOR UNIT SALES Major unit sales saw 680 dealers up and 710 down. NORTHWEST 7.7% Parts Department -12.2% Service Department -5.7% Major Units -4.0% Overall MIDWEST 7.7% Parts Department 3.0% Service Department -4.5% Major Units -1.3% Overall NORTHEAST 4.9% Parts Department -1.3% Service Department -0.7% Major Units 0.4% Overall SOUTH 9.0% Parts Department 3.6% Service Department -1.1% Major Units 0.2% Overall WEST 4.6% Parts Department 1.7% Service Department 4.0% Major Units 3.8% Overall UNITED STATES 6.8% Parts Department 1.0% Service Department -0.8% Major Units 0.5% Overall FOR MORE ON THE SAME STORE SALES DATA For more information on this report and other industry data, contact: cdkrecreation.com/dataservices EFG Companies announced its 2017 predictions and recommendations for the automotive and pow- ersports F&I market. These insights, formed through thousands of conversations with the nation's leading dealership principals and lenders, reflect an air of cautiousness for 2017. However, there are many options for retail automotive/powersports dealers, lend- ers and F&I agents to successfully navigate an uncertain business climate for a prosper- ous 2017. "Although unit sales fell in the second half of 2016, we anticipate volume will pick up in February, when early income tax refunds arrive," said Glenice Wilder, vice president, Powersports, for EFG Compa- nies, and a Powersports Business blogger. "There will be a slight growth in the power- sports market overall in 2017, with dealers putting greater emphasis on increasing aftermarket income through the sale of F&I products. Lenders that remain in the DIGEST EFG predicts tighter credit for 2017 GLENICE WILDER

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