Erik Buell Racing, founded by the irrepressible Erik Buell, is selling a 49.2 percent stake to Hero Motorcorp for $25 million. The massive cash infusion (arriving in two waves, the first of which is $15 million) should keep Erik Buell Racing in the motorcycling headlines—and on AMA and other racing podia—for a long time to come, as well as help Hero Motocorp become a globally recognized brand.
What’s interesting is why Hero Motocorp (which started as Hero Honda, a joint venture between a bicycle manufacturer and Honda Motors in 1984) bought the stake in EBR. As we reported last year, Hero engaged with Buell, supporting his race team in exchange for design and engineering work, but the Indian decided it needed a more solid relationship. This latest investment is Hero’s first in an overseas company: “This is the first time that Hero MotoCorp is buying a stake in a company outside India…the first step in globalization of the HMC brand,” CEO Pawan Munjal told reporters. Of course, Hero benefits from the positive association with the successful efforts of Buell racers like Geoff May, as well as EBR’s decades (dating all the way back to Erik Buell’s pre-Harley days) of building his own brand in the U.S., and understanding of the U.S. Market. Not to mention closer ties with Erik Buell himself, considered by many industry observers to be the most creative engineer in motorcycling.
Last February, I thought it unlikely that Hero would sell products to North American consumers, but Munjal contradicted that saying he believed that “smaller engines can be sold in America,” according to a Daily News of India story. Strong interest in models like the KTM 390 Duke and other high-performance, small-displacement machines make me agree, and knowing Buell, I’ll bet he’s got some zingy little Singles in his bag of tricks, motorcycles that could be relatively cheap to develop, high in profit—and very fun to ride.
New factory-owned subsidiaries in North America, Europe and Africa hint at HMC’s goal of global domination, with plans to export 350,000 vehicles from India this fiscal year, according to a Wall Street Journal article. Additionally, HMC will open manufacturing plants in Columbia, Kenya and Nigeria. And EBR itself will grow from a somewhat boutique operation currently into a real manufacturer, with a goal of building 20,000 units a year by 2017.
That Erik Buell, champion of the American-built sportbike, will be helping an Indian company become a force in the U.S. market illustrates just how quickly the world now turns.
believer’s video… but only if you’re a believer…
vid1
https://www.youtube.com/watch?v=0Sh7O4_ZgUs
vid2
https://www.youtube.com/watch?v=14CbyKe-eNA
vid3
https://www.youtube.com/watch?v=GO1hzZe222c
An Indian company invested in EBR because they saw potential of EBR engineering. EBR accepted Indian company investment because no American company would invest in EBR because they all too busy sending money to China to make China rich and more powerful than America.
Plain and simple!
Who do you think made China so powerful?? Apple made in China, HP made in China, Jeep parts made in China, Harley parts made in China, Ford parts made in China, even a friggin Rubbermaid baskets are all made in China!!
It is the brain of American company that needs to be re programmed to bring back the job to America, and it is the el cheapo mentality of American people that needs to be reset to finally accept that quality and ingenuity always cost money and stop sending wadload of money to China!!
Stop talking negativity about other countries just because they have money and willing to invest in a real genius and stop blaming EBR to accept the money, anyone on the same position would do the exact same thing EBR did!!
That all facts plain and simple!!
Sorry I am Buell through and through or was. I don’t dig it, I made up my mind selling off the CR gonna pick up a basket case CityX to rebuild so I will always have the one Buell I love the most. I wish Buell well but it won’t be with me I don’t like the idea of sleeping with the Indians so to speak. They pillage everything. The QC is horrid look at Land Rover 100K throw em out a dollar a mile. Nah I am looking at what Yamaha has in it’s new offerings.
I have the impression that the Indians are buying a brand name to enter the USA. In any case i hope that if we ever see big bikes from these people they will not look so ugly (looks are a subjective matter but for me the latest buells were pure monstrosities).
re: “I have the impression that the Indians are buying a brand name to enter the USA.”
or course, land of the free home of the brave. who wouldn’t want that…?
even people who SAY they don’t want that, secretly want that. 🙂
You work for the NSA, don’t you? =P
i moonlight part-time.
So the Indians are taking back their land, huh….
With Mahindra quite successfully racing in Moto3, does Hero want Eric to design a Moto3 GP racer?
Looking at the current M3 bikes, I have no doubt that someone as clever as Eric could kick their butts!
Although not high end on most levels, I really like the Hero format. Choose your engine, then your frame, and your choice of plastics and colour. I like the “pick & mix” options they provide, and with a little EBR magic in the mix, we could see some really cool singles really cheap. (in theory)
OK, this is fun. I’ll take a stab at it:
The first and only modular motorcycle. Choose from a menu list in each of the following categories. The resulting bike that you choose could be anything from a regular bare naked, to sport touring, to non street legal track bike, to adventure, to Supermotard.
Menu categories:
Engine state of tune, includes ECU software
Engine is stressed main frame member
Front wheel
Front brake
Rear sub frame
Fuel tank
Suspension…
Fairing/naked
Color combinations
You get the idea.
With due respect – I couldn’t ever see this working properly from both a mainstream manufacturer and consumer perspective. Consider the liability issues when a customer crashes their bike due to poorly chosen geometry, suspension and weight distribution combinations. One frame geo will not suit all applications either.
This is already happening anyway in an ad hoc fashion in the custom cruiser and cafe racer scene anyway. With cruisers it’s just people bolting on crap to an unchanged chassis, but I see some pretty scary and horrific abominations coming out of the cafe racer scene right now.
One thing that would be awesome would be different frame sizing for different sized riders, just like on bicycles. I can’t see this ever happening though.
Atta boy P, I like the way you think! That being said azi is right and that menu would have to be, lets say “carefully reduced”. I would add that if you see the hero website, they are already giving the consumer some of these options. I here you on the frame size thing too azi, but the china bikers get it.(gotta love irony)
And it just occurred to me that this ‘modular motorcycle’ happened in 1988, in the form of the Triumph Trident, Sprint, Speed Triple and Tiger.
OPEN LETTER TO ERIK BUELL AND COMPANY –
I know you will be reading the comments on this site – I would be. There is no doubt that I speak for many Buell and non Buell ownwers who watched what transpired in October of 2009, and have been sitting and watching with more than a passing interest the events that have happened since then. When I saw the MD headline this morning, I was prompted to simply say this, with as much sincerity as possible — change frame designs, change motor configurations, change CG and rake numbers, even change directions – but don’t EVER change what makes Buell, Buell. I am riding my third Buell, and a very large part of why I do so is because of the heart of Erik Buell himself and the people behind the name. I for one, among many others, wish you and the company the absolute very best in
moving EBR forward, and I wait with much anticipation the day I can walk into a showroom and buy one of the few bikes that ever moved me the way the Buell does. It’s about so much more than the bike – and the bike currently make us drool. Erik, you’re doing us proud. Run the ship where it needs to go.
I’m hoping for some good things from Buell again. I’m one of his biggest fans (own 3,S1-Uly-1125CR) I’m not an adventure bike guy, more sport tourer. Maybe they can figure out how to get an air cooled twin to pass future emissions. Too bad our Wall Street heroes vision of the future is the next quarter, not decade or century and we wouldn’t be hearing about the Indians or Chinese investing in our geniuses.
re: “The massive cash infusion (arriving in two waves the first of which is $15 million)”
is there any better sentence in human lexicon, than one that starts with MASSIVE CASH INFUSION…!? 🙂
good name for a band.
There may yet be a third new Buell in my future. The next one might not have that lovely pushrod single or twin like the two I have now, but it must have the stamp of Erik’s engineering.
As far as I can tell the Buell-Harley experience was nothing more than an exercise in frustration. Maybe things will change for Eric. I sure hope so.
Hey, H-D did foot the bill for him for a while. He got to design motorcycles on their dime, probably made a good living, and now looks ahead to a promising future.
I wish MY job had this kind of “frustration”.
I ride a 2003 XB9R every day, and have a Blast in the garage for when my wife wants to ride, so I am a bit of a fan-boy. But, I REALLY hope Erik had a little more clairvoyance with this deal than he did with the HD deal. If it was just done for the $$, then he’s just walking into the same situation he did years ago with HD. I can’t think of anyone I would be more excited about seeing succeed (other than maybe myself), so here’s my up-raised glass in wishing EBR all that best.
Maybe this cash will FINALLY get some new models off the drawing board?
re: “I ride a 2003 XB9R every day, and have a Blast in the garage for when my wife wants to ride, so I am a bit of a fan-boy”
no, you’re a LOT of supporter. good job.
“If it was just done for the $$$…”
Business deals are always done “just for the $$.” Otherwise it is called philanthropy. That said, I think this will be very different from HD who bought Buell because they thought they could make money by running it better. Hero clearly sees a lot of value in what EBR has to offer, and the size of the investment suggests their vision goes far beyond engineering and design which they could have bought for much less.
re: ““If it was just done for the $$$…
Business deals are always done “just for the $$.” Otherwise it is called philanthropy.”
touché.
I’ve owned 4 Buells, the last two being the Ulysses model, and I love the damn things. Sure, the 12X has idiosyncrasies (mostly associated with the funky HD mill), but it works quite well and it’s low maintenance. Now I’ve got to resist the urge to buy something else (KTM 1190?), and wait for EBR to do an adventure/touring bike with a modern powerplant. Maybe they’ll call it Cyclops or Odysseus…
If you’re first in line for the 2015 Odysseus look behind you, it might be me.
Goose
re: “Now I’ve got to resist the urge to buy something else (KTM 1190?), and wait for EBR”
parade rest.
This is news, HMC is one of, if not the largest producer of motorized vehicles, of the 6 million vehicles they produced roughly 90% were sold domestically. India and China both are growth markets, giving Eric access to such a market and an infusion of cash, should prove to be beneficial. It would be great to have an American mass marketed motorcycle company that focused on motorcycles types other than over weight cruisers. Eric is the man to get the job done. I had hoped that Polaris would have seen the light but ……….. Well what they have seems to be a tunnel vision.
For the unknowing.. the Buell XB12S Lightning is a fun, light weight compact machine which deserves to still be in production. The unique features that these machines have work, it’s that simple. As far as using the modified sportster engine, it’s a proven design that never needed to be spun to the breaking point to make power. The belt drive with fixed axle and idler pulley was also smart engineering. It appears that “Hero” understands smart engineering and is willing to pay for it, which is more then you can say for any American Manufacturer who wants to shut smart engineering down in the name of the so called bottom line.
I don’t think there was anything “smart” about the engine in the XB12. The bike would have been a much better package with a more modern, sportier engine. I believe that engine played a large role in the difficulty Buell faced in gaining acceptance for their products to a wider market.
I loved the engine in my XB-12R, sure it could have used a little more top end but for the real world mountain road twisty stuff I could always go as fast as I needed to. The simple maintenance was an added plus.
To each his own, of course. I don’t care for the character of the mill. Strong but dull. The lack of valve adjustments is a plus, but the amount of stuff that fails on these things negates any wrench time saved by the hydraulic tappets. 🙂
49.2%? Who calculated such and odd amount?
It means they have a controlling interest in this venture. It is by design.
I don’t think so. Erik still has the majority and controlling interest
While in a large widely held corporation that would easily be a controlling interest, I’m guessing Erik owns the other 50.8% thereby retaining control. I’m guessing though.
It would surprise me if he fully owned the other 50.8%. It seems he would have had to distribute a little bit of equity to bring some of the talent with him.
He wouldn’t make THAT mistake again would he?
$25 MIL…? that’s alotta coin…?
When I read the line “and knowing Buell, I’ll bet he’s got some zingy little Singles in his bag of tricks…” all I could think of was the Blast. Lop off one cylinder from the Rotax motor and it would be a zingy single.
Rotax has singles, no need to lop anything off.
Just don’t build another Blast. However a 60 hp single in a light responsive chassis, I’m all for it. As long as it doesn’t have a name that is easily changed to B last.
HMC just wants to get hold of the technology behind the Buell Blast.
Yeah, that would fit with the relative power levels of Honda’s recent new bike offerings.
You can’t be serious. Erik wants to forget the blast and build a real single.
We all want to forget the Blast. LOL
Baaaahahahahaha!
Just another example of a foreign investor buying American ingenuity instead of having the intellect and creativity to develop something themselves.
Would have been nice is a U.S. investor would have stepped up to the plate.
A US investor with $25m usually goes after something profitable. The US moto market has been pretty bleak for some time.
and there it is…
welcome to the niche business of motorcycling…! (haven’t gotten to use this phrase in awhile).
And saying that Hero doesn’t have intellect or creativity is shortsighted at best, xenophobic at worst. They are a big, powerful corporation that sells 1/2 million bikes a MONTH (more per month than the annual US total volume) and they are competing in Moto 3 competitively. They know what they’re doing. EBR stands to learn a great deal more from them than Hero does from EBR.
I don’t see a Moto3 team…
Just sayin.
re: “I don’t see a Moto3 team…”
Woops, upon looking closer, neither do I. I mistakenly associated them with Mahindra Racing. I apologize, my mistake.
Dave,
I think the word you are looking for is racist, not xenophobic. I’ve heard is so many times, pretty funny since when I worked in Silicon Valley, most of what came out of the All American Valley was created by non-US born engineers. On my team most of the guys were Indian, most of the rest were from the Middle East, only two (me and our tech writer) were of European decent. I doubt there is any shortage of creative, very smart engineers at Hero.
However, Eric Buell is a one of a kind. It is my guess that is what Hero is buying.
Goose
Well, at least tech support will be well-staffed.
🙂
RIMSHOT…!!! LOL
You are a veddy, veddy, bad man, VLJ!
It was a big mistake to get involved with Humpty Dumpty to begin with- they killed Buell by compelling him to use those ancient paint shaker engines already 40 years out of date when the first production Buell rolled out- Hopefully it will all turn out well now!
You can’t blame Harley-Davidson for that one. Buell himself was the one who chose the power plant. He wanted to show the world that you could make a respectable All-American sport bike. He did a pretty good job of it. H-D dealers not really wanting to be in the sport bike business is what brought down the brand. Good to see Erik doing so well.
What else did he have to choose from at the time??? It’s not like Harley had any modern powerplants on the shelf to use. Also, you certainly CAN blame Harley Davidson for stealing the engine that was originally being developed for Buell and putting it in the V-Rod instead. Harley screwed Buell six ways to Sunday plain and simple.
The engine is loosely based on the one Harley developed for the VR-1000 superbike, pre-dating the Buell relationship by nearly 10 years.
That’s not what was reported in Cycle World magazine – and quoted in the Wikipedia article on the Buell Motorcycle company:
“The liquid-cooled Harley V-Rod motor, developed by Harley-Davidson then made street legal according to the EPA by Porsche, was originally an Erik Buell project, designed for a fully faired AMA Superbike Buell by 1998.[8] Harley decided the engine should also be used in a sport-cruiser, then took over development, making it “too big, too heavy, too expensive and too late” for Buell.[8]”
http://en.wikipedia.org/wiki/Buell_Motorcycle_Company
Erik’s first “production” bike was designed around a 2-stroke racing engine for the AMA formula series – unfortunately for him the AMA switched to Superbike as their top-shelf series. The VR engine design was supposed to yield a “family” of sporting H-Ds – singles, V-twins, maybe even encompasing the long-in-development “Nova” V-four. Buell switched to the XR1000 engine for his first “road” bikes (really BoT production racers) with the plan being, eventually, to get the racing VR for race bikes and the VR-derived street versions for street bikes. He didn’t take H-Ds rather insular way of managing the race team and the Company’s institutional reluctance to build anything other than cruisers and tourers into account.
So we got more XL-derived engines (with electric cooling fans!) until the last Rotax powered bikes. Too bad H-D didn’t hire Bombardier/Rotax in the first place to help with the VR-design rather than Porsche Engineering!
Hopefully Hero will provide the cash – and engine production capability – for Buell to expand. My personal wish is a Buell designed light-weight single – say 400-600cc – but that’ll depend on the market (and margin!) for smaller bikes growing…
The wiki article on the v-rod states that the engine was developed from the vr1000 superbike program. The vr1000 began racing in 1994. Buell may have worked on the project but it never “his” to be stolen. It was for the race program and later HD decided where it would Go.
Humpty has refused to develop any new engines. The Virago engine was designed by Zylstra who was an HD engineer and was a much improved powerplant- Yamaha sold millions. When the CB 750 appeared the writing was on the wall for HD as these mills are massage chairs, paint shakers and noise makers.
HD had 40 years to develop a new sport engine before the first production Buell- the VL engine is an OHV conversion of a flathead 45. Great as a noisemaker but will easily explode in sport applications.
Exciting times ahead!
re: “And EBR itself will grow from a somewhat boutique operation currently into a real manufacturer, with a goal of building 20,000 units a year by 2017.”
FISTPUMP…!!!
re: “What’s interesting is why Hero Motocorp (which started as Hero Honda, a joint venture between a bicycle manufacturer and Honda Motors in 1984) bought the stake in EBR.”
MORE interesting is that it took a foreign entity to make this investment and that it wasn’t done by Americans. it’d been a cold day in hell before this would’ve even been necessary in countries like Germany or Italy.
Cold day in hell like the way Audi owns Ducati?
You’re right. Americans, by nature, seem to be out of touch with the rest of the world.
hmm Ducati has been owned by everyone, Texans, Germans…
talking small business. ya know, grass roots.
Has anyone noticed that Ducati’s MotoGP bike is about as good as the HD VR1000 was relative to the competition.
Just a note.
Hero is in the MOTOR vehicle business – not (just) the investment business. And they want access to the NA market as well as access to EBR’s engineering abilities. Plus, this gives them somebody on the ground in the US to help with all the bureuacracies invovled in certifying vehicles for sale in NA. Just look at the Mahindra small pick-up truck debacle and you can see why an Indian company would want to invest in something like EBR.
As far as what’s un-American and what’s not – as long as Buell gets funding and manufacturing capability not sure why it matters if it comes from India or Indiana. EBR is a very small, privately held company – a niche in a niche business. Not likely that any US investment company – much less any US motor vehicle company – would have the slightest interest in something like EBR. It isn’t as if EBR would’ve been building a giant factory to build bikes (and pay top-dollar wages) that’s going to be otherwise built in India. Without Hero there probably wouldn’t be ANY expansion of EBR’s product or market.