Motorbikes are a hot asset in Australia as they fall into leisure, commercial and consumer categories.
In this edition of Assets in the Spotlight, we take a look at the landscape, rates and the general ins and outs of motorbike finance and put the exciting electric motorcycle segment under the microscope with the help of Savic Motorcycles.
- Motorbike sales have increased over the last few years – up 13.4% over 2021
- Off-road bikes are a popular segment
- As are electric motorcycles, which are gaining serious momentum in Australia
- Off-road bikes (like dirt bikes) are extremely popular, totalling 43% of all bike sales in 2021
- Motorbike rates start from 4.99%
- Required documentation is similar to car loans
The motorbike landscape in a nutshell
Similarly to other assets, motorbikes are experiencing strong demand as evident in 2021’s 13.4% rise from 2020.
According to the Federal Chamber of Automotive Industries (FCAI), off-road motorbikes recorded 53,118 units sold in 2021, up 18.8% from 2020.
Road motorcycles recorded 37,270 units sold in 2021, an increase of 6.8% from the previous year.
Scooter sales were also up by 8.1% from 2020 after recording 4,812 units sold in 2021.
Note that in Australia, a scooter (or moped) is classed as having an engine size of 50cc or less and doesn’t travel any faster than 50kmph.
“The motorbike space is close to me both in and outside of Nodifi commitments,” explains National Business Development Manager, Alex Bodriagin – a motorbike enthusiast himself.
“Owning several motorbikes over the years and supporting dealerships partnered with Nodifi has given me ample opportunity to see this robust industry grow over the last 12-24 months.
“One particular segment that is gaining serious traction is electric motorcycles and like their 4-wheel cousins, especially the Tesla Model 3, are seeing huge momentum.”
Here are sales numbers over the last several years:
||Total Motorbike Sales
Excitement surrounding electric motorcycles
The acronym “EV” isn’t just for Teslas and the like anymore. Electric motorcycles (or e-Motorcycles) are gaining serious interest as batteries become cheaper and ranges become longer.
For example, regenerative braking (regen) adds about 10% back to the battery in the process of using the engine to slow down momentum rather than brakes. Range on most electric-powered “motor” bikes is 160km – 180km per charge with some extending to double that.
Australia’s first high-performance electric motorcycle manufacturer, Savic Motorcycles, states that demand for two-wheeled transport in Australia has increased over the last few years.
“The demand reflects our current order bank of 200+ pre-orders of the Savic C-Series so far,” said Chief Marketing Officer, Alexandra Bromley.
“Although the COVID pandemic undoubtedly drove some of the growth in motorcycles, consumer research for more secure and individual mobility has been the main driver.
“With congestion an ongoing problem for many capital cities, road motorcycles and e-scooters are being recommended by peak industry bodies as a tool to help ease the load on Australia’s transport systems.
“Electric motorcycles will be an important part of the ecosystem of motorcycling in Australia and, similar to anyone who has stepped out of their traditional ICE car and into a Tesla, they’re blown away with the simplicity of operation, the advanced tech and the instant performance – a reaction we see to electric motorcycles.”
Savic Motorcycles’ C-Series models are showing consumers that both convenience and performance are readily available.
Savic C-Series Alpha (range topper) in numbers
- 0-100km/h: 3.5 sec (For comparison, Kawasaki’s popular Ninja 650 comes in at 3.92 sec)
- Estimated Range: 200+ km
- Level 2 Charge time: 4.5 hrs
- Battery: 16.7 kWh
- Power: 60 kW
- Torque: 200 NM
Electric motorcycles currently available within Australia average around $20,000 to $35,000 for new electric motorcycles with higher-performance models commanding larger price tags.
Generally, motorbikes are not large ticket assets when compared to yellow goods or trucks for example. However, with their increasing popularity, bike finance has established itself as a lucrative revenue stream for many businesses offering asset finance.
The most popular motorbike brands in Australia (from 2021 sales) are Honda, Yamaha and Kawasaki – in that order.
Off-road bike sales, which made up 43% of all bike sales in 2021, showed that popular models include the Yamaha WR450F which retails for around $16,500 and the KTM 500 EXC-F priced at around $18,000.
Road bikes, representing 30.17% of all units sold in 2021, highlighted that Harley-Davidson’s Breakout is Australia’s top seller in this category. The Breakout retails at just over $36,000 new.
Motorbike rates start from 4.99% and, like other assets, increase and vary per client profile and age of asset.
Common rates per profile
- New motorbike / asset backed / stable income with considerable surplus / excellent credit score (700+): 4.99% – 6.99%
- Motorbike 0-3 years old / asset backed / stable income / average credit score (550): 6% – 11%
- 5+ year old motorbike / renting / part-time work / low credit score (400 and below): 9% – 16%+
If your client requires a bike for commercial purposes, for example delivery service, or you’d like to clarify any rates, reach out to your Relationship Manager if you’d like some assistance.
How much can my client borrow?
As with other assets, amounts are based on borrower profile and capacity to repay the loan. Different lenders specialise in different borrowers and scenarios.
Nodifi can finance motorbikes for as low as $5,000.
Maximum lends are commonly capped at $500,000. However, ‘the sky’s the limit’ for suitable borrowers.
Something to consider is restoration projects which usually mean a client looking to purchase a classic bike (like a Triumph for example). Parts and mechanical work are also typically required.
In these situations, a personal loan can often suffice but, as always, don’t hesitate to reach out if you need assistance.
Personal loans can also include any modifications that a client might request.
Documents and information
Usually, your client will need to provide standard documents required for finance. Although they vary per lender, these typically include:
- Asset details: Registration / serial number, condition (new/used), year, make and model
- Identification: e.g., driver’s licence
- Employment / Income: Length of employment, name & location of employer or business, additional income – e.g., rental income or Centrelink
- Residence: Address, time at address, mortgage repayments or rental history. If a borrower has lived at an address for less than a year, previous addresses are often required
- Monthly net income vs expenses: You’ll need to know your client’s finances including, monthly income and expenses (general living costs and any other loans and bills). Partner income is often taken into account as it can lower living expenses and increase capacity to repay a loan
- Privacy consent: As per all finance applications, this form is required as it allows all those involved to view a client’s credit file as well as other critical information
Nodifi aims to keep turnaround times as short as one business day. More complex lending situations can require additional documentation and some back-and-forthing which can extend this time.
Depending on the financial product, sale type (dealer or private) and asset, your client or the seller of the vehicle will receive funds shortly after settlement. Times vary depending on their banking institution.
Motorbike finance in summary
Despite not seeing the demand in comparison to motor vehicles, motorbikes can add an additional stream of revenue to any business offering asset finance.
Also, with the rising electric bike market, expect an increasing number of clients expressing interest in these products.
Reach out to your Relationship Manager if you have any questions or need any help in offering bike finance to your clients.