The past year has been unkind to Harley-Davidson, as the credit crunch, over-production and a drop in used bike value have conspired to depress sales and earnings. At the same time, $4.00 gas has brought a 65.7% jump in the sale of motor scooters.

Image also plays a role in the relative fortunes. HD has had great success cultivating the brand as representative of rebellion and adventure, rather than efficient transportation. For many, buying a Harley was only a minor expense compared to the clothing, accessories, and customization they bought to identify themselves as one of the tribe.

Also, for many years, Harley-Davidson bikes were in such demand that riders could buy a new model and sell it a couple of years later for as much or more than they paid for it. Do you hear echoes of the housing crisis? Yes, as inventories finally caught up with demand, some less-that-stellar borrowers found themselves upside down on their loans, with predictable results. In the third quarter of 2008, Harley-Davidson's revenue dropped 11.1% vs. the previous year, and the number of bikes sold was down 13.7%.

Scooters, while offering a certain panache to members of the college set, sell primarily on the cost per mile of transportation. A scooter can get 50 miles a gallon or more, and the cheapest entry-level vehicles can be had for under $2,000. If you want to spend upwards of $10,000 on a scooter, though, check out the Honda Silver Wing.

Here's the skinny on the scooter vs. Harley question-- neither is good choice as one's only mode of transportation in most of the U.S. Cold, rain and snow can turn a ride into torture. For recreation, most scooters are underpowered and not durable enough to stand up to long-distance cruising. For the long term, I'd buy a Harley for fun and a cheap car for transportation.

Right now, however, when money is tight tight tight and gas expensive, the scooter sales shops are in HOG heaven.


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