Harley’s Losing its Roar
Harley-Davidson reported another set of earnings yesterday, and the demand gauge is running dryer and dryer, sending the brand globetrotting for ideas. But Harleys will never get old, right? Let’s ride!
Every 11-year-old boy had a Harley motorcycle on his bedroom wall, the meaning of that brand firmly etched into our psyches as an emblem of what makes America great! With its first motorcycle built in a tiny shed, investors in Harley-Davidson have seen their company ride on the back of engine grease for over a century, vastly outlasting any comparable firm’s life expectancy. However, the next hundred years aren’t looking anywhere near as bankable as the previous hundred.
Despite beating profit expectations, younger generations slammed the breaks on demand, leading to 5% fewer bikes being sold compared to this time last year. The trade war isn’t helping either! The company first endured an initial presidential scathing for manufacturing in China, before Trump’s tariffs threw another spanner in the works and turned it into a double whammy!
Investors know there are still wild cards up Harley’s sleeve, however. The firm managed to sidestep tariffs with a permit to manufacture in Thailand, and many new bikes will find homes in Asia. Chinese sales of the two-wheeler catapulted 27% last year, demand for the two-wheelers weirdly strongest in all continents but their spiritual homeland.
Harley-Davidson also has a plan B with some funny looking electric bikes and a plan C with kids bikes. It’s a time of reinvention for Harley, so now might be time for the market to gun the engines, not put on the brakes!
