Harley roars back for its 110th birthday
A slew of new models shows how the iconic US motorcycle maker's rebound reflects what the overall economy is doing.
It's a big week for Milwaukee-based Harley-Davidson (HOG). The iconic American motorcycle company is unveiling eight new models under the name "Project Rushmore" at an invitation-only dealers meeting in Denver. It coincides with the company's 110th anniversary celebrations.
Denver Business Journal reports that the meeting also involves a gathering with analysts who cover the company and will meet with Harley management to discuss not only new products but changes in the company's manufacturing and product development.
Observers note that Harley-Davidson's financial journey over the past several years -- its recession blues as well as its comeback -- have been a good mirror for the nation's recent economic recovery.
After 20 years of strong growth and sales, Harley found itself in dire straits as the recession began in 2007. A strike at its York, Pa., assembly plant and a profit drop of more than 10% to $933.8 million that year didn't help. As the recession deepened, profits continued their tumble, down to $654.7 million in 2008. That prompted job cuts and plans to close some operations. Scores of dealerships were closing down.
In mid-2009, Keith Wandell, former president and chief operating officer of tech group Johnson Controls (JCI) became the first outsider to become Harley's chief executive in nearly 30 years.
"When I joined the company, [the dealers'] biggest issue was that sales were off 40%," Wandell said in a recent interview with Milwaukee Magazine. "Earnings were in a free fall. That created a whole other dimension of complexity for the company. We had long lead times on manufacturing bikes. We shipped the bikes we made, but they might not have been the bikes the dealers wanted at that particular time for their market."
An article earlier this year in the Washington Post's Wonkblog noted the factors leading to Harley's recovery are also factors that have contributed to the broader economic rebound as well: reducing overall output, adapting to changing consumer demographics, being more cautious with credit and debt, doing more with fewer workers and taking a new look at potential global markets.
One of the bigger changes made under Wandell's leadership was aggressively marketing Harley-Davidson to groups outside of the core customer base of white, aging and relatively affluent baby boomers.
"We’ve heard that our riders are aging," chief marketing officer Mark-Hans Richer told Milwaukee Magazine. "People think our core riders will be going away. It's kind of like they stopped making Caucasian men in 1980."
But Richer noted that a younger and more diverse generation of Harley fans -- Gen X'ers and millennials -- are taking up the reins. "There is no decline," he says. "We can stay strong and grow with our core market and grow with outreach, too."
The numbers seem to support that statement. Harley-Davidson says it shipped over 247,000 motorcycles last year, up 6.2% from 2011.
I don't see any young kids(16-20) years old owning Harleys...see plenty of Ninjas and etc.....in my eyes..HDs are waaaaayyyyyyy too expensive...even if used just for a toy..heck, im in my 60s and can only barely afford a new sportster.........and a kid in high school knows enough economics to under it sure aint supply & demand running HD...expense of a tradition id one thing......the prob is the entry level mkt...I hear all the time that Yamaha, Honda, Kawasaki are not in need of maint til way past 3000k miles...hd is just ripping off their guys..! hd is just rippin guys off cause they don't care except for profits...tom Rutherford.
As a French man once said, "all you Americans have for culture is Harley Davidson & Rock & Roll",
to that I say "What else is there" !
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