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An Interview with the CEO of Malaguti, USA

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Author: Brian Ducharme

Publishing date: 03.24.2003 10:31

Joel Martin was nice enough to take the time to answer a few questions about Malaguti.

A Brief History

2002 Yesterday

It is a widely held opinion that the finest motor vehicles in the world hail from Italy. Ferrari and Lamborghini lead the pack in the automobile industry, as Malaguti leads the pack in the motor scooter industry. Malaguti currently has plans of importing its full range of scooters into the US market. Malaguti produced 250,000 high-end units last year, making the brand well known yet exclusive. Scooters are generally simple machines with plastic moldings and rubber components, but a Malaguti scooter is nothing less than an aesthetic and engineering masterpiece.

Since 1930 the Malaguti family has been producing quality products. Today Malaguti produces some of the best Scooters using the latest techniques in design, research, and development. All the products and supplies are made with ISO 9000 quality guarantee norms. Malaguti also has the highest standards for safeguarding the environment from gas emissions. In Italy when a customer sees the name Malaguti he knows it is top quality.

Having well established its position in Italy, Malaguti has been paying greater attention to the European and oversea markets. About 40000 units, equal to about 30% of the total production run was exported in 1998. Malaguti is now interested in capturing a slice of the American market. If past sales are any indicator its line will do extremely well in North America.

The Interview
NHSC - "Thanks for taking the time to answer a few of my questions."
Joel - "Not a problem."

NHSC - "With the price of gas rising each day, do you think that Americans will
start turning-in their SUV's for scooters?"
Joel - "I honestly believe that consumers in warmer states are already looking for
ways to save money. I get about five emails each week asking how many miles to the gallon does a Yesterday get? Scooters sales in the last five years have grown to the point where Americans are seeing them as transportation and not a toy. Ten years ago the only players in the market were Honda and Yamaha. Today theres over 30 companies importing bikes. The market has gone from maybe 20,000 scooters to over 40,000 a year. Quite a jump."

NHSC - "What is your best selling scooter? And where do the majority of your sales
come from?"
Joel - "Most of our sales are in the Southern states. Our best seller is the Yesterday, F-12, and F-18."

NHSC - "How are your sales of Big Scooters going? And when can I get a chance to test ride a Madison?"
Joel - "The new Phantom 125cc and 200cc will be here in May. It uses the same engine
as the new Vespa Grandtourismo. If sales go well we will bring in the Madison 200 and 400. We stopped the delivery of these bikes because they didnt pass California EPA. If the market continues to grow then it might be worth it for us to invest in the tooling to make the changes. We also have a new 500 in the works for the US for sometime in 2004 or 2005."

"I think what you see in the US market is that people are starting to ask questions. In the last year or so customers have become more demanding. They want to see brochures, read reviews, they ask where the bike was made, how long the warranty lasts etc... They ask if its a private label scooter? You have a lot of companies out there importing bikes from China and Taiwan giving scooters a bad name. A lot of dealers only look at margins and they will make bigger margins with the Chinese product. In the end they are only screwing the little guy because Chinese companies dont care about insurance, marketing, warranty support, you name it. They are not responsible because next week they go by a different name and they dont exist as a brand in the US. We are dealing with the most uneducated scooter buying public you could ask for in the US. People who are in it for the money and importers will take advantage of this. Most Americans dont know the first thing about scooters so this first time buying experienced is getting ruined by sales people pushing a Chinese bike. What we need is informed consumers demanding better brands and better support. Once it gets to this level like in Italy you will see companies like Aprilia, Vespa, and Malaguti do a lot better. Theres a reason they do so well in Europe. We cant compete in price with the Asians, but quality means something in this country."

"I also see dealers changing. We had a lot of dealers during the start of the boom two years ago carrying everything they could get their hands on. We see them calling us now telling us that they want to join because so and so went under or didnt have parts. Even the dealers don't know. Some products look great, but the company has a history of bad support. Even some Italian companies are now out of the picture or getting bought out because of this."

"I think with time both US consumers and US dealers will be better informed about scooters in general. Its a billion dollar business in Italy and the UK. Its only a matter of time before we pass the 100,000 mark in the US. This could be the year."

NHSC - "Thanks again for taking the time to talk to us and good luck with your sales this year. I really think that Malaguti has the right idea when it comes to servicing their customers. I know how hard getting parts can be, luckily I have a good motorcycle shop to go to when it breaks."
Joel - "Thanks for having me."

For more information about the full line of Malaguti Scooters go to:
Malaguti USA, Inc.

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