Ducati Reduces Racer Image, Improves Sales - TheStreet

Ducati Reduces Racer Image, Improves Sales

Ducati has sold out of its Multistrada by making a more practical machine.
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BOSTON (TheStreet) -- By the time Ducati unveiled its Multistrada 1200 last month, 500 were pre-sold and there was a 60-day waiting list for the much-touted Italian motorcycle.

That's good news for a company, and industry, that was hard hit by the recession, dragged down by the same forces that reduced demand for luxury cars and other high-end indulgences.

The Multistrada 1200, built around Ducati's most powerful motor, the 1198 L-Twin Testastretta, is capable of speeds in excess of 150 mph. But, unlike typical sportbikes, it was also engineered with the reality of urban roads and the needs of everyday riders in mind. Comfort was as much a stated goal as performance was.

Billed as "four-bikes-in-one," a push-button control provides instant traction, torque and braking adjustments, even while in motion. Pre-set modes allow the capability to go from a high-performance, quick-response ride to a more mundane commute.

Pricing starts at $14,995, with "sport" and "touring" option packages priced at $16,495 and $19,995.

TheStreet spoke to Michael Lock, chief executive officer of Ducati North America, about the launch and its significance for the company.

What is unique about the Multistrada?

Lock:

This is a more rational motorcycle than what we've made in the past. We wanted to be able to deliver not just a fantasy product, but one you can use every day.

Sport bikes have become incredibly related to actual racing bikes because the

Baby Boom

generation demanded that authenticity of experience. But chances are that the typical superbike buyer is 48 to 52 years old, weighs 250 pounds and probably hasn't been to the gym in 20 years. These motorcycles, for someone like that, are actually a torture rack. So we have this growing gap in the sport-bike world between who the buyer is, what their aspirations are, and what actually will satisfy those aspirations. Producing bikes like the Multistrada, we used all the technology to make a comfortable, unintimidating motorcycle. You don't need to be a superhero to ride it.

How big a consideration was pricing?

Lock:

You can't make anybody buy anything, but what you can do is force them to take you seriously. To a lot of people, Ducati is an elitist product. We've seen the change in the economy as an opportunity to look people in the eye and say: "We want your business, so here is this great bike and here is a price you can't argue with."

We knew going into this recession that unless we were quick on our feet and very reactive, we could really take a body blow. We've been working very hard over the last year to reposition Ducati as more of a relevant brand, rather than just a luxury. Bikes like the Multistrada are of critical importance in communicating that message.

Is Ducati targeting a different customer?

Lock:

We are an industry that has really had tremendous success from the buy-in of the Baby Boomer generation. However, we understand that we need to pass the baton to the next generation of buyers -- Generation X and Generation Y.

When we come out of the recession, there will be a lot of boomers who will not return to our industry. Those plump 401(k)'s may never be plump again, and there is all that lost equity in their real estate investments. They may never return to our industry with anything like the buying power they had before. We can all sit in the corner and moan about it, or we can get on and market our product and the lifestyle that it offers to a new generation.

How do younger customers differ?

Lock:

They are less willing to compromise. They want the technology to work for them, rather than working for the technology. Look at the successful technology companies. The tipping point for success or failure is not having the coolest gadgets or the most performance. It is making the most accessible and intuitive products.

The best MP3 player in the world is not the iPod. It doesn't have the best sound quality and it is not at the best price point. But it is the most intuitive to use and it's the gadget that fits in with the lifestyle aspirations of the person buying it. The same is true with

Apple's

(AAPL) - Get Report

computers, the iPad and iBooks.

We've been really careful to make the technology make sense to people. We really are, with the Multistrada, the first company that has brought state-of-the-art electronics to motorcycles in a way that the rider can learn in just five minutes.

-- Reported by Joe Mont in Boston.