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DSC_1491I’ve always loved you… The strong, silent type… Always there to break the toughest turf and pull and plow for what seems like forever. You we’re kinda behind the times… Who else built 1910 2 cylinder tractor designs into the 1950s? But you were always there when needed, without complaint, and sometimes you even caught up with the times.

But John (Deere), lately you’ve been becoming kinda high maintainence. Just noticed it the other day when I wandering by the local dealer for your “Deere Days” or whatever promotion. Desite it being a nice saturday with a free lunch offered, the parking lot was empty but for an old pickup or three, probably the usual parts counter hangers on takin’ in the free lunch. And the promised equipment demonstrations and test drives? Looked like the same bunch of tractors that had been sitting on the lot long enough to grow roots!

Mighta had somethin’ to do with the prominent near $20,000 price tag on a 25 horse subcompact “1 series” tractor with nothing but  a mower and a front end loader. For those kind of bucks we’ve come to expect a full cab with wipers, heat, and probably a coffee maker too. Jilted, I rode home, taking new interest in the several orange, blue, and red tractors along the way. Got on the web and figured out where that crazy near $20k price came from- Looked to be MSRP plus shipping and the other “usual” charges. But then I remembered the 17% discount that Deere was offering my state DOT, even if they only bought one tractor. And that 17% applied to the cheaper economy “E” model too, dropping the price by thousands. So yes John Deere, you been holdin’ out on me, while wooin’ the big buyers… And here I even bought stock in you.

So John, this is it… That orange Kubota guy does the job just as well or better, and the dealer knocked over a thousand off the asking price before the hagglin’ even got started. And if Kubota ain’t available, there’s the blue and red tractors too. And don’t give me that “buy ‘merican” BS… I know damn well your mother was a Yanmar! So you can take your attitude, and your arrogance, along with your limited catagory 1 3 point hitch and…

In all seriousness, the local John Deere dealer’s marketing manager and I have been engaging in an e-mail debate of late. As a customer, I’m rather off put by the dealer’s highball pricing- It’d make a lot more sense to lowball with a stripped model of the same tractor to get customers in the door, then upsell them. But this appears to be SOP at the Deere dealerships, which tend to be owned by huge chains- This dealer has only 6 stores! Their “competitor” 40 miles away has dozens of stores over several states, and the local Case IH dealer has around a hundred stores spread over several continents and countries. That sort of effective monopoly keeps prices profitably high, but drives away volume… Which given current low crop prices and the glut of late model tractors on the farms, is not a good thing. When the tractor dealer’s lot is full of repo’d 600 horse tractors, giving a residential or small farm customer a good deal on a 20 horsepower tractor keeps the doors open ’til better economic days. That’s why, as a Deere shareholder, I’m ticked… I can go over to the Kubota dealer and get a better deal, but if every customer does that I’m losing on downward trending Deere stock what I save by not buying a Deere.

Maybe I should make the Deere annual meeting this year…

EBR is in receivership, despite receiving twenty million in capitalization from a bunch of foreign investors who traded half a million in “green” apiece for a green card assuring themselves and their families a lifetime pass in the United States. That’s on top of Indian motorcycle maker behemoth Hero dropping twenty five million into EBR in return for a near half share of Erik Buell Racing, LLC. This 45 million dollar capital infusion doesn’t include the “flooring” (financing of unsold dealer stock) provided by GE Capital and whoever else’s dollars were sunk into EBR… It’s an LLC and not a public company, so we may never know just who all has skin in the losing game that EBR has become.

So how did EBR, in barely five years and after building a mere couple thousand bikes, manage to blow through at least forty five million? Unlike previous failed wannabe bike builders like Excelsior-Henderson, EBR rented their digs instead of soaking the investors and local governments to build a Taj Mahal factory/museum and finance multiple junkets to Daytona and Sturgis. Granted, rent may have consumed a couple million. The head count peaked at a bit over a hundred towards the end, so figure a payroll that went from zero to five or six million a year. Figure worst case of $10k per bike in raw materials for the couple thousand EBR’s built and there’s twenty million sunk in materials… But GE Capital has effectively bought the dealer stock of perhaps a couple hundred EBRs, and at least a few hundred more EBRs have actually been sold to hard core customers. So EBR has probably spent a couple million on rent, fifteen million or so on the help,  case maybe ten million on materials, and the odd couple million on ads, web presence, and paper clips. We’ve accounted for barely half of the known capitalization of EBR, what happened to the rest?

I know about EB-5 from the mismanaged state immediately to the west, the southern of the Dakota twins. South Dakota had a very active EB-5 program, so successful that the state employee administrator in charge of it sold it to himself and made it his private company. Where was the official oversight? He up and blew his head off when the media started looking for explanations of why so many EB-5 funded companies went under… Just like EBR. And after being blessed with those millions in EB-5 capital, how could a string of thousand head and up dairies and a giant beef packing plant in Aberdeen not succeed?

Well, their business plan sucked for a start- The market for milk and beef isn’t growing, as consumers shift from milk to soft drinks and now overpriced water, while beefeaters are defecting to poultry and tofu. And the Dakotas, hundreds of miles from major markets, are a poor logistical choice. EBR made similar mistakes, offering a raw boned traditional race bike with a license plate while Yamaha with the R1 and BMW with the SS1000 have changed customer expectations to include a bit of riding civility. That limited EBRs market to the couple hundred remaining hard core “race bike with a plate” buyers a year. Building there own engine when no less than premier supplier Rotax would supply it was a questionable move too.

But boss of record Erik Buell isn’t the kind of guy to worry about budgets… Would you expect anything less from a brilliant engineer who quit Harley to build race bikes, even after Harley offered him the job of chief engineer! Reputedly “hard to get along with”, A glance at court records in his suburban Milwaukee county finds him named in no less than three divorce proceedings, and at age 65 he still hasn’t acquired the exurban estate expected of Harley execs… Heck, he even allowed a lean on his modest home to get Harley to acquire Buell Motors two decades ago, a deal his own lawyer advised against. And shortly after Harley shut down Buell and tossed him, he put aside starting EBR for a couple days to pour new babbitted main bearings for a couple Norwegians riding half century old Danish bikes cross country in the middle of winter. Clearly, Erik Buell is the guy you want to keep comfortable in front of a CAD terminal, and let someone with more appropriate talents handle the money.

So were the millions in EB-5 largesse legally wasted on dumb business plans, or was there sinister and perhaps even criminal intent? We’ll probably learn first from South Dakota, where an open criminal investigation of the EB-5 program continues. We do know that a whole industry has fed off the EB-5 program, and while the dairies and beef packing plant went bankrupt, the wheelers and dealers that put together these questionable deals are doing very well. In Wisconsin the same wheelers and dealers that sold green cards to raise green for EBR and themselves did the same for a company that’s trying to build and market a two stroke diesel aircraft engine. That’s a business plan that makes EBRs look sane… But makes money for the wheelers and dealers just the same.

So while EBR and Erik’s dream may be dead, forty foreigners and their families got green cars, and the wheelers and dealers made big bucks… “There oughta be a law”, or did they break laws we already got?

“To comfort the afflicted, and afflict the comfortable”

That creed is seldom adhered to in moto journalism, and all too frequently forgotten in journalism, period. Back in the 60s I admired Car&Driver for their forthright style, only to be let down when I found that they had pulled a whole issue because Porsche didn’t like their review of the 914. American truck mags were the worst, full of badly rewritten press releases glorifying the latest from IH, Freightliner, et al… I’d later drive the same noisy almost out of control gutless truck and it was obvious the mag’s paid by the word writer had never driven it. Same with the glowing reviews of motorcycles and farkles, neatly correlating with the maker’s ad spending in the mag.

And then came the internet and bloggers… Amateur and even a few pro journalists owing nothing to much of anyone, but with the occasional axe to grind. Thus we are seeing a return to the Upton Sinclair and more lately Steven Brill style style of muckraking that keeps democracy sharp. An excellent example is Cory Heidelberger, author and publisher of the Dakota Free Press, the go-to authority on South Dakota politics. Now Cory leans to the political left, but his investigative journalism is so good that republicans read and even buy ads on his blog. And if it wasn’t for Cory, I and most of South Dakota wouldn’t know what “EB-5″ is, ’cause the mainstream media didn’t cover the brewing EB-5 scandal in South Dakota until Cory covered it so much they couldn’t ignore it.

So what’s an EB-5, and what does it have to do with anything with wheels? EB-5 is an immigration loophole that allows any foreigner to buy green cards (residency permits) for themselves and their family by investing a half million bucks in a U.S. business and creating a few jobs, at least on paper. Now that sounds all well and good, with foreign investors helping to capitalize startup businesses here in the good ‘ol USA… Problem is, despite all this capital flow, a lot of these businesses seem to strangly go belly up after feeding on all those EB-5 dollars. In South Dakota these spectacular bankruptcies have befallen a string of mega dairies so big they can probably be seen from space, and most recently a massive beef packing plant plopped down in Aberdeen, thousands of miles from the mass markets for it’s beef.

Well, EBR was a receipent of EB-5 funding too, and EBR is now insolvent too. I should have been suspicious when I was thrown off a Buell forum just as Erik Buell was launching EBR just after HOG(NYSE) shut Buell down. I’ve been through a plant closing before, and was starting up the usual “community organizer” strategy of finding out what all suppliers and communities were affected by the Buell shutdown and thus might be brought together to bring Buell back. Perhaps I was interfering with the EB-5 scheme? I don’t know, but I’m gonna stay on this story and follow it to truth.

Thus I’ve learned to be a bit suspect when an organization suddenly tries to censor this little ol’ blogger. Couple years back I was thrown off of the American Truck Historical Society forum when they were trying to cover up some fiscal stupidity, largely involving taking on too big and expensive a headquarters building, then sweetheart leasing part of it to some buddies. Since then the crap has hit the fan, and ATHS has a new director and hopefully they can put the past scandal behind them.

So when I thrown out of BMWMOA today, I took notice… Why pull the free trial membership of this same little ‘ol blogger because I disagree with how they run some aspects of their organization and have questioned the reliability of their favorite motorcycle? I mean, they’d be smarter just to take my money and ignore me… So I’m beginning to smell something suspect at BMWMOA too. But BMWMOA will have to wait while I dig through the rubble of EBR, and not being of the BMWMOA caste, I won’t have the money to renew my membership ’til the first of the month anyway. If I’m lucky, I’ll have enough to buy some new work/riding boots with my stockholder discount at Berkshire Hathaway annual meeting/looting of Omaha. The BMWMOA Brahams in their stylish imported moto boots will sneer, but who cares?

So ya, I’m making room for some muckrakin’ motojournalism… In between the ride and rally reports, and whatever else fits will get printed!

Buell, AKA Erik Buell Racing, has filed for receivership under Wisconsin Statutes Chapter 128. That chapter is a part of Wisconsin’s progressive tradition, allowing citizens relief from debtors while they reorganize their business and begin a payment plan. While liquidation is possible under Chapter 128, you can liquidate a business at any time anyways,

There’s simply too much good stuff that EBR has created to allow the company to be broken up for scrap, unless the creditors are really dumb and refuse to cooperate…And their being plenty of dumb creditors out there, that’s a possibility. But a cutting edge sport bike that needs only some rough edges taken off, ABS, and hard bags is too valuable an asset to scrap, ‘specially when it’s all tooled up and in production and needs only better financial management and marketing.

Buell will be back… His bikes are too great to die!

No, I ain’t talkin’ ’bout license fees nor the few cents we pay at the pump that don’t even keep up with patchin’ the potholes and plowin’ our streets and highways… Heck, those taxes ain’t even kept up with inflation! Couple years back on tax day I wrote about how the often high cost of shipping amounted to a rather gross “tax” on everything. ‘Twas reminded of that the other day when I plopped enough oil filters and crush washers and such in my “cart” at Wunderlich America to see my new Super Tenere past 100,000 klicks, then clicked on to “shipping” and found that getting this few kilos of stuff from the left coast to Minnesota was going to cost near as much as the filters and such themselves. Wunderlich, if that abandonned cart bothers you, just bring it to the MOA rally and I’ll buy it, minus the inflated shipping costs. Heck, I’m even tempted to invest in the biggest hard bags and racks known to AdvRider so I can load up at rallies and save the shipping, even though I’m addin’ a big ‘ol ‘hack next winter. Now I will say in Yamaha’s defense that the local dealer’s price for the filter wasn’t felony level highway robbery, though the concept of “crush washers” is still foreign to them. But the bike is remarkably free of service reminders requiring dealer reset, I’ve already got a Yamaha repair manual in my hot little hands, and despite being a 21st century design the bike has no desire or ability to “call home” to “Mama Yama”. Taking a break from perusing the Yamaha manual, what should jump over the virtual transom but a PR missive from Volvo’s Mack brand informing me that if I’d given in to their previous PR pitches and bought a new Mack with their M-Drive automated manual transmission, they’d be following MY transmission all over the country. In fact, for the last couple years “telematics” has been a default option on new Mack and Volvo trucks, allowing Volvo to track YOUR Mack or Volvo as you wander the continent. Nice to know that Volvo is worried about the welfare of YOUR transmission and truck, but Macks have quite well covered billions of miles all over the world without Volvo’s newfound supervision. So you’re driving down the road in YOUR new Mack enjoying the beautiful day and shiftless Volvo transmission until the video display in the dashboard starts flashing and demanding your attention. You are informed that terrible things are about to happen to YOUR transmission, and Volvo has thoughtfully provided directions to the nearest dealership. You call your shipper and receiver and let them know you’ll be delayed, and drive a hundred miles out of route to the Volvo/Mack dealer… They’re kinda thin on the ground out here. Pull into to the dealer and you see they’ve been expecting you, with a new transmission in the crate at the ready and a stall held open for your truck. What the hell, it’s under warranty for 5 years and 750k miles, so you head off to the motel and to a sound sleep. Next morning you head back to the dealer, you’re truck is done and you head to the cashier to sign off on the warranty and collect your keys and get back on the road. But… What’s with this dollar sign followed by five digits at the bottom of the bill? You bother the service manager, who informs you that despite not even being halfway through warranty, Volvo has disallowed the warranty claim… And passes you off to Volvo’s 800 “Customer Assistance” number. Despite not having ever spoken with them, they seem to know a whole lot about your truck and where it’s been. Denying the claim, they cite that miserable dirt road you had to deliver down last month as “improper and abusive usage for a highway model truck”. And those 88,000 pound permit GCW loads you hauled last winter during the propane shortage? Volvo has rated and warranties the M-Drive software version you bought for only 80,000 pounds, even though the rest of your Mack is good for at least half again that. And how’d they find out about all this “abuse”? Remember how the salesman bragged about how YOUR new Mack could see the hills ahead, and adjust to the weight of the load? Yup, besides being able to “call home” to Volvo, YOUR new Mack has a road map of North America in it’s brain and thanks to the “wonders” of telematics, the ability to “call home” and rat you off! Now I don’t want to single out just Volvo here for some rightous indignation, they’re just the trend setter. Heck, I suspect GM bought OnStar from Hughes to make they’re too frequent RePos easier, and then figured they’d sell access to the actual car owner to defray some of the costs.  All over the industry, paper and even CD/DVD manuals are disappearing, replaced by online manual rental. And while the “evil” “Guvmint”‘ OBD2 standards democratized powertrain diagnosis, everything else is becoming proprietary- If you buy a new VW or even BMW, budget $350 extra or so for an aftermarket software or hardware “hack” so you can do basic diagnostics on YOUR vehicle. Yamaha didn’t get the memo, my new Super Tenere still happily displays diagnostic codes at no extra charge, but I suspect the next generation will “fix” that marketing “mistake”. But the trend is clear: Every manufacturer is working on putting a big ol’ video display in the dashboard and an extra antenna on the roof, and “freeing”you from the bother of buying all those manuals and disgnostic stuff and tools for YOUR vehicle.

So you think you own YOUR new vehicle because you bought and paid for it… The manufacturers think of it as a lease with a hefty front end deposit!

Prepare for much excuse making from the BMW camp…
“Ratings Overview
Brand Reliability
More than 11,000 riders sound off on over 12,300 motorcycles

Yamaha, Suzuki, Honda and Kawasaki are among the more reliable motorcycle brands. Conversely, Triumph, Ducati, BMW and Can-Am are among the more repair-prone brands. That’s what we found based on the feedback of more than 11,000 subscribers reporting on over 12,300 motorcycles purchased new between 2008 and 2014. The graph shows the percentage of motorcycles from each brand that we predict will need a repair by the fourth year of ownership. Our statistical model estimates failure rates for 4-year-old motorcycles not covered by a service contract and adjusts for mileage driven over a 12-month period. The mean annual mileage is around 3,800 among all motorcycles included in this analysis. Differences of fewer than 10 points between brands are not meaningful. Note that models within a brand may vary, and design or manufacture changes may affect future reliability. Still, choosing a brand with a good repair estimate can improve your odds of getting a reliable motorcycle.
Brand Repairs and Serious Problems
Motorcycles

Yamaha 11%
Suzuki 12%
Honda 12%
Kawasaki 15%
Victory 17%
Harley-Davidson 26%
Triumph 29%
Ducati 33%
BMW 40%
Can-Am 42%”

Thanks Consumer Reports for the great research, well worth the price of a subscription!

Note that differences of less than 10% are statistical noise, even with a sample of around 10,000 bikes! That means that I and my buds discussing the reliability of our half dozen or even baker’s dozen of BMWs or whatever around the campfire is statistically worthless. But we do know that there’s a 95% chance that the 4 Japanese brands are more reliable than Harley, Triumph, Ducati, BMW, or Can Am. The only non Japanese brand that is even close to the Japanese brands reliability is Victory, and Polaris should be duly complemented on that achievement. That puts Victory a near statistically significant 9% ahead of rival HOG(NYSE), a major accomplishment for an upstart which proves that Americans can build a bike near as reliable as the Japanese… HOG(NYSE), what’s your problem? Triumph and Ducati slightly trail Harley, but who ever expected Brit bikes and Ducs to be reliable? And BMW… Clearly the “Legendary Motorcycle of Germany” to quote BMWs own airhead era ads has become the legendary lemon of Germany! Fortunately there’s no shortage of online forums for BMW riders to comiserate about flaming final drives and failed $2k ABS units… Tread gently on the BMW forums for the next few days folks, the egos of the worshipers of the Fatherland’s finest will be kinda tender. And thanks to Can-Am for bringing up the rear and giving the BMW riders a bit of solace… They’re bike wasn’t quite the worst!

Gonna be fun reading the BMW forums the next few days…

Back in the days when April Fools Day was damn near a national holiday I brought both the Milwaukee Road and the Rock Island back to life, did new model press releases for the new Mack B model and U model sidecar outfit, staged a chase and even a dragrace in Minneapolis long forgotten subway system between a new Light Rail Car and a hopped up PPC streetcar piloted by none other than the late owner of the Minnesota Twins. I made folly of government too, with Minneapolis annexing most of the country overnight and the discovery of the city documents of Farmersville, which undid Minneapolis annexation of darn near half the city and returned it to, well, farmland. But unfortunately April Fools hijinks have gone out of style, and all too many of the people running governments and corporations have so little sense of humor left that they’d have a Cease and Desist Order on my way before they even figured out it’s a joke. And given the current boardroom drama at Volvo, I’ll have to save the news of the new Mack Superliner and Valueliner models with the mighty 750 hoursepower Mack/Scania V8 for another year.

Meanwhile, people seem to make the same hilariously bad decisions in both government and mobility. As a reluctant candidate I noted that all too many of the topics of debate were leftovers from the last century if not the one before. For example, welfare and alledged cheating thereof are regular topics of political diatribe, but as unlikely a president as Clinton ended welfare as we know it. That leaves the conservatives to try to relabel “food stamps” as welfare when in most places they don’t even use stamps anymore, and the whole deal is an ag subsidy program that benefits farmers, food processors, and grocers more than the mainly young and elder direct beneficiaries. Dig into the big data that is all around us today, and you’ll find that there’s been more tax dollars stolen by crooked food industry middlemen than receipients, and WalMart’s profits would take a big hit if the conservatives succeeded in killing “food stamps”! The left is just as bad, back when I lived in north Minneapolis I dug up the neighborhood’s crime stats and Detroit’s and found a similar crime rate. But the city fathers and mothers insisted there was no crime problem anywhere in Minneapolis, citing citywide statistics that were much better than Detroit’s while they used north Minneapolis as a convenient dumping ground for newly released criminals. But the data told a far different story- In one neighborhood, over 60% of the adults had felony records. I still have some worthless property there, so I still track stats for the area… For example, the census track I used to live in has a working age adult workforce participation rate of only 44% while neighborhoods in other parts of the city and suburbs have rates in the 60%, 70% and even 80% ranges. In a labor market with less than 4% unemployment where “any warm body” can get hired, clearly a lot of young men and women have instead chosen to hang out on the streets and peddle drugs, stolen goods, and themselves intead of punching the clock. But despite this data, the city insists there is no problem…

Consumers make the same stupid data ignorant decisions when it comes to buying cars, trucks, bikes, etc.. Look at the reverence given the German auto and bike makers, with supposedly well educated consumers paying up to twice the price for a 3 pointed star or some semblance of a propeller on the hood. Fact is, all three german companies are full line manufacturers, Daimler even building an “A”series to compete against VW’s low and mid market offerings, but the keep it on the other side of the big pond so as not to cheapen Mercedes luxury rep here. Daimler is also the world’s largest builder of medium and heavy trucks, and they didn’t get there by charging premium prices- Make the rounds of the truck dealers shopping for a new truck and Daimler’s Mercedes and Freightliner brands will generally match price with anyone. And can these german brands justify their premium prices with higher quality? Again the big data, thanks to Consumer’s Union, says no… The German cars generally do no better than even the Asian economy cars for reliability, despite higher prices. And motorcycles? BMW and Harley had twice as many defects as Honda, Yamaha, and Kawasaki!

Same with the two contrasting schools of  vehicle design, the “old skool” gearheads and the hybrid and electric car loonies. On one hand we have people speccing and buying vehicles with no attempt at improved efficiency whatsover, escuing aerodynamics and powertrain efficiency for bluff fronted trucks and other motorized antiques that probably have better aerodynamics in reverse than forward directions. They choose the biggest motor available, then spend a fortune “unstrangling” it’ ignoring the fact that big two valve pushrod engines are loosers right from the draftboards they sprung from decades and centuries ago. Just the publicly available big data from road tests, SAE tests, the Energy Department, etc. tells us that the way to effiency is small hard working engines with lots of valves and preferably overhead cams too. Meanwhile, the other camp derides anyone who hasn’t put themselves deep in debt to buy an overprice hybrid or electric car. They brag of cleaner air and reduced greenhouse gases, ignoring the fact that on the highway a hybrid has no advantage and electric cars largely get recharged with coal generated electricity. I have to admit though, most consumers seem to be paying attention to the data on electric cars- the Tesla and Nissan Leaf are fighting it out for the best selling electric car crown at a rate of around 3000 a month, with the Chevy Volt trailing. With a new battery needed after 10 years or so costing more than the electric car will be worth then and limited range even with a new battery, all but the greenest environmental fanatics are steering clear of electrics. Those environmental fanatics are as lockstepped in their ways as the Harley good ‘ol boys, drag out the data and prove them wrong and they throw you off their online forum or worse!

So in a way, every day is April Fool’s day as the Harley faithful keep the showrooms busy and the environmental fanatics keep Tesla’s stock jacked up despite unsustainably low sales. In politics, the presidential primary season(s) are just beginning and the candidates will be tripping over each other across Iowa, hawking “solutions” to all the 20th and even 19th centuries pressing problems. Enjoy all the wealth of data available today in making your gearhead buying decisions… But for the politicians, there’s little hope!

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