Could Ducati Be Up For Sale Again?
Streamlining of Volkswagen's business might put Ducati on the fringe
It looks like Volkswagen’s huge emissions scandal surrounding its diesel-powered cars could potentially impact motorcyclists, too. Reuters is reporting the German automaker is considering selling Ducati, which its Audi division purchased in 2012 for $935 million.
The potential sale comes as Volkswagen looks to streamline its operations in the wake of the Dieselgate scandal. As part of the streamlining process, several thousand jobs at VW have been cut in order to help fund the company’s shift towards electrification.
As far as Ducati is concerned, Volkswagen has tapped investment banking firm Evercore to develop a list of options, which also include keeping the Italian marque that still brings in $109 million a year. However, that number is peanuts when Ducati is reported to be worth somewhere in the region of $1.6 billion – with a B. That said, a banker with knowledge of the industry told Reuters potential suitors would likely offer VW a cool billion for Ducati.
Anyone who’s followed the Ducati legacy knows the company has seen its fair share of ownership changes. As of now there’s no clear front-runner lining up to purchase Ducati away from Volkswagen, but there are several interested parties. The Reuters report says Chinese peers could be interested (which would mean Ducati would join fellow Italian marque Benelli as famed Italians operating on Chinese money), as could Indian brand Hero. Then again, Ducati could be wrestled away by a consortium, the likes of which bought Aston Martin in 2007, or by private equity firms. All of this is a long way of saying Ducati’s future owner is entirely unclear at this point.
Audi’s purchase of Ducati in 2012 was a bit controversial. Analysts questioned the move from a business standpoint, chalking it up as a power grab by VW’s chairman Ferdinand Piech, a huge enthusiast of the brand. Piech, grandson of Ferdinand Porsche, has since left his role as chairman under acrimonious circumstances, leaving no clear advocate within the company to vouch for keeping Ducati.
What happens now? Well, your guess is as good as ours. Stay tuned, as we’ll update the situation when we know more.
Troy's been riding motorcycles and writing about them since 2006, getting his start at Rider Magazine. From there, he moved to Sport Rider Magazine before finally landing at Motorcycle.com in 2011. A lifelong gearhead who didn't fully immerse himself in motorcycles until his teenage years, Troy's interests have always been in technology, performance, and going fast. Naturally, racing was the perfect avenue to combine all three. Troy has been racing nearly as long as he's been riding and has competed at the AMA national level. He's also won multiple club races throughout the country, culminating in a Utah Sport Bike Association championship in 2011. He has been invited as a guest instructor for the Yamaha Champions Riding School, and when he's not out riding, he's either wrenching on bikes or watching MotoGP.
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Personally I would like to see Ducati ownership modeled similar to HD. T=Let the employee take the helm.
Perhaps they could merge with MV Agusta, and bring Benelli back to Italy.
Maybe get Ferrari involved in the mix.
I also don't understand how a company that generates $109 million is worth $1.6 billion, this must be why private equity firms do so well.
The superbike era is over. Ducati's business model was based on them. You can see that they are now building Multistradas, scramblers etc. They understand this trend. If someone is willing to sit and allow the brand to infiltrate these more lucrative markets, then the profits will follow. Problem is a lot of investors are short sighted, and don't want to invest for the long term.