History
The first Buell motorcycle, the RW750, was built in 1983 purely for competition in the AMA Formula 1 motorcycle road racing championship. At that time, Erik Buell was a top contending privateer motorcycle racer. After completion of the first two RW750 racing machines, one of which was sold to another racing team, the Formula 1 series was canceled. Erik Buell then turned his focus towards racing-inspired, street-going machines using engines manufactured by Harley.
In 1993, Harley-Davidson purchased 49% of Buell, investing $500,000 and taking Erik Buell's house as security. Erik Buell took the deal, against strong advice from his attorney. Harley-Davidson CEO Jeffrey Bleustein had bought it as a skunkworks development.
In 1998, Harley-Davidson bought a majority stake and took control of Buell Motorcycle Company, and the company became a subsidiary. Since then, Buell has used modified Harley-Davidson engines, primarily from the Sportster, to power its motorcycles.
Most Buell motorcycles use four-stroke air-cooled V-twin engines, originally built from XR1000 Sportster engines. After these were depleted, a basic 1200 Sportster engine was used. In 1995, the engines were upgraded with Buell engineered high-performance parts and further upgraded in 1998.
The liquid-cooled Harley V-Rod motor, developed by Harley-Davidson then made street legal according to the EPA by Porsche, was originally an Erik Buell project, designed for a fully faired AMA Superbike Buell by 1998. Harley decided the engine should also be used in a sport-cruiser, then took over development, making it "too big, too heavy, too expensive and too late" for Buell.
Harley-Davidson forced Buell to follow the rigid product planning and distribution process beginning in the 1990s, with the philosophy that Buell was the starter brand, and customers would eventually trade up to a Harley. By 2008, Harley's credit arm, Harley-Davidson Financial Services (HDFS), was struggling, and the lower resale value of Buell motorcycles meant that new bike sales were significantly affected. When Harley CEO Keith Wandell was hired, he immediately questioned why Harley even owned Buell. Wandell, who had never been on a Harley before being hired, was heard talking about "Erik's racing hobby", and questioned "why anyone would even want to ride a sportbike". He organized a team to analyze "the adrenaline market", and concluded that sportbikes would encounter high competition and low profits, while cruisers had high returns.
On October 15, 2009, Harley Davidson Inc. announced the end of production of Buell Motorcycles to focus more on the Harley Davidson brand. Selling Buell was not legitimately considered, as Harley didn't want their Harley dealerships to sell an outside brand, and Harley didn't feel Buell had much value without the dealer network. Closing the Buell brand was estimated to cost Harley approximately the same as their total investment in Buell over the past 25 years. Erik Buell immediately began looking for outside buyers, finding BRP (who owns the Austrian Rotax engine manufacturer BRP-Powertrain) a good choice, especially since Harley would have to pay Rotax "an eight-figure sum" for the 1,125 cc engine contract.
Erik Buell later founded Erik Buell Racing to provide support for 1125 and XB privateer race efforts.
Read more about this topic: Buell Motorcycle Company
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