By James ” Hollywood ” Macecari
Harley made $8.3 million in the fourth quarter of 2017, compared with $47.18 million in the fourth quarter of 2016
Harley Davidson’s numbers for the 4th quarter were just released and it’s a “WTF” moment we are all witnessing. A drop of 82% is no joke, especially for a company such as Harley Davidson. This drop is signaling that Harley Davidson is in “Life Preserve Mode”. Many of the financial pundits are calling it “The Slow Harley Death”. Right now all the Stock junkies are recommending the stock be “Held”.
I call bullshit on that. Being a biker and seeing it’s 2018 line, no plan in the future for a long term strategy to turn around the slumping motorcycle market other then a joke of pinning it’s hopes on the “Livewire” line, I’d say sell that shit as quick as you can. Harley Davidson will have two choices moving forward. Go back to being a private company where investor pressure isn’t on it’s shoulders all the time, or get ready to merge with another company to try and salvage the brand. Maybe they should start talking to Polaris. At least Polaris knows what the hell they are doing over there.
Reported sales for the fourth quarter of 2017 increased 18% to a record $1,431 million; adjusted sales were $1,430 million, up 17%, a majority from organic growth
Motorcycle segment sales, including PG&A, totaled $103 million, a decrease of two percent compared to $104 million reported in the fourth quarter of 2016 which included $25 million of Victory Motorcycle wholegood, accessory and apparel sales. Indian Motorcycles wholegood sales increased in the high-single digit percent range in the fourth quarter, while Slingshot® sales more than doubled. Gross profit for the fourth quarter of 2017 was $5 million compared to $1 million in the fourth quarter of 2016. Adjusted for the Victory Motorcycles wind down costs of $3 million, motorcycle gross profit was $8 million, up from the fourth quarter last year due to higher sales volume for both Indian Motorcycles and Slingshot and lower warranty costs.
North American consumer retail demand for the Polaris motorcycle segment, including Indian Motorcycle and Slingshot, increased about 30 percent during the 2017 fourth quarter. Indian Motorcycle retail sales increased about 17 percent, with both heavyweight and mid-sized motorcycles increasing at similar mid-teens percent levels. Indian Motorcycle continued to gain significant market share for the 2017 fourth quarter and full year on a year-over-year basis. Slingshot’s retail sales were up significantly due to improved product availability compared to the fourth quarter last year. Motorcycle industry retail sales, 900cc and above, were down high-single digits percent in the 2017 fourth quarter.
We will all sit here and debate back and forth what Harley Davidson needs to do, but the simple fact is the “Iceberg” has been hit and it’s just a matter of time before the ship starts to sink. The question in all this will be how fast the ship sinks. The plan Harley Davidson has set out is a “Joke” at best. One example is women ridership. I can tell you doing Insane Throttle everyday, looking at the numbers, only 3% of the readership is female. The median age for the demographics on this site is 34-44. If you look at that demographics just on a online news magazine like Insane Throttle, you can see just how hard Harley Davidson will have it trying to attract women and the younger generation into the lifestyle. Harley Davidson better hope they have a back up plan because the current one isn’t going to help out the company. It’s only going to drive it further and further into oblivion
Things are getting worse for Harley-Davidson, the maker of motorcycles that your dad aspired to ride. They will be closing a plant in Kansas City, Missouri, the company disclosed today, while reporting fourth-quarter profits that fell 82 percent (!) compared to the fourth quarter of last year. They also announced they’ll be making an electric motorcycle, so there’s that, too.
Harley made $8.3 million in the fourth quarter of 2017, compared with $47.18 million in the fourth quarter of 2016, according to the Milwaukee Journal Sentinel. The company has been in decline for years now, as sales have sagged because consumers are worried about things like safety. In addition, baby boomers, who bought a very large amount of motorcycles back in the day and remain a big part of Harley’s demographic, are also getting older.
From the Journal Sentinel:
Harley-Davidson worldwide retail motorcycle sales fell 6.7% in 2017 compared to 2016. The company’s U.S. sales fell 8.5% and international sales were down 3.9%.
Harley has taken steps to counter what’s been a prolonged downturn, including tightening motorcycle inventories.
“Our actions to address the current environment, through disciplined supply and cost management, position us well as we drive to achieve our long-term objectives to build the next generation of Harley-Davidson riders globally,” Matt Levatich, president and CEO, said in a statement.
“We finished 2017 with over 32,000 more Harley-Davidson riders in the U.S. than one year ago, and we delivered another year of strong cash generation and cash returns to our shareholders,” Levatich said.
Harley says it plans to tighten its manufacturing operations through a multi-year initiative anchored by the consolidation of its motorcycle assembly operations in Kansas City, Mo., into its plant in York, Pa.
Around 800 people will lose their jobs because of the Kansas City plant’s closure, while Harley will hire some 450 in York. The slow death of Harley has been a bit painful to watch, though the company is still trying. Also today, it said it would be bringing its first electric motorcycle to market within “18 months.” I honestly can’t imagine who the market is for an electric motorcycle—the main appeal of riding a motorcycle is feeling and hearing the engine—but, at this point, Harley doesn’t have much else to lose.
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