Inventory slump hurting Harley's turnaround
The motorcycle maker's long-term strategy is running afoul with some dealers and constraining inventories of some pricier models.
CEO Keith Wandell, hoping to use Ford (F) as a template in Harley's turnaround, is streamlining production, cutting labor costs, pushing Harley into emerging markets and improving stores and customer service.
This will help Harley improve a U.S. market share that stood at 58% in the third quarter over Polaris Industries (PII), Honda (HMC), Yamaha, Suzuki, Kawasaki, BMW and other peers.
But Wandell's long-term strategy for Harley is running afoul with some dealers and constraining inventories for some of its pricier models, such as the Touring. One Minnesota dealer, St. Paul Harley-Davidson, has sued Harley for restricting international sales and third-party sales on portals such as eBay (EBAY) and Amazon (AMZN).
Moreover, extensive restructuring of one of its largest manufacturing facilities in York is limiting production of some of the company's more expensive and most profitable models, leading to overall margin decline. (See our previous article: Harley-Davidson Q3 margins squeezed by plant restructuring.)
A recent new dealership survey by the investment firm Robert W. Baird confirmed that the inventory of new Harley motorcycles is at its lowest point in 10 years, which will result in lost sales in the near-medium term as the York facility restructuring is expected to continue until 2013.
We currently have a price estimate of $40 for Harley Davison's stock, which is more than 15% above current market price.
D-S then advocates serious violence against any HD rider. I doubt D-S has the cajones to say that to anyone's face, let alone actually do it. It must suck to be you Doubting-Skeptic. You are pathetic.
@ doubting skeptic
Yes, I will give you the fact that there are those individuals who rev their engines to make as much noise as possible. I see them in jap cars with megaphone exhaust pipes more than I see them on a harley. If anyone buys your story about the bleeding ears part then you are a great story teller. I'm sorry she has hearing issues but it could have been due to an ear infection. Yes, there are more and more noise ordinances being invoked regarding motorcyle exhausts. Funny, the rice burners arent included nor the audio systems in some cars. Don't blame all bikers because of a few inconsderate individuals who cant control themselves. Maybe we should have some fat ordinances? Limit clothing sizes so fat people cant wear anything other than a tent. How about car or truck sizes? You have to love this blame a biker attitude. A biker takes a parking place and you are pissed that this 50 plus mile per gallon is taking up a whole parking place. Or that they can split lanes and cruise by your traffic jammed car and pass you up. My guess is you would be the guy to open up your door to cause them to wreck.
Think about this, you are in a cage. We are outside of that cage and you simply cant stand that fact.
@ doubting skeptic
Let me guess, you drive a camary, wear a tent, have had your driverside mirror broken more than once, have a handicap sign hanging from your rearview mirror, have a walker, diabeties, high blood pressure and troll the boards looking to stir up trouble...
If you would rather buy 2 jap bikes than one harley you probably drive a toyota too! No wonder our economy and jobs are in the dump!!!
first..it is simple. if you don't like or want or cannot afford a harley...dont buy one!
second..in case you havent noticed EVERY vehicle has parts made in different countries. there is a label that states what percentage of that vehicle was made and what country it was made in. then you would see it was assembled in the U.S. this is called a world economy.
third..no reason to call someone riding a different brand of motorcycle names. as long as it has two wheels it is ok by me.
fourth..harley changed the engine case design from vertical to horizontal split so no more oil leaks.
fifth..i dont understand the mentality of some of those riding the 'rice rockets'. it is not the bike but the a****hole riding it. splitting lanes, zig-zagging in traffic trying to go 20mph faster than traffic is moving, passing on the shoulder, all are good recipes to get dead instead of where you want to go.
i have been riding since 1970, rode japanese, british, german etc..now ride a harley. 2006 street glide(flhxi), 20,000 miles no problems. i will ride in winter if weather and road conditions permit here in n.j.. its comfortable, starts no problem, change oil, replace tires and brakes...thats it.
get on two wheels, enjoy the ride BUT ride safely and sanely. have a good time. ride safe.
Anyone who doesn't understand what having a Harley means will never understand. It's the same crowd that bombs around in their obnoxious Honda Civics with the big loud can muffler sticking out. They don't get what it means to have American style.
Go to the Smithsonian in Washington and see what Japanese manufacturer made the engines that went in the Kamikaze's planes that killed Americans in Pearl Harbor. I wouldn't be too proud to be straddling one of those machines and then knocking Harleys!
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The solid report comes a month after the retailer closed all of its Canadian operations.
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