By Brady Carlson
Harley-Davidson Inc. officials said 2019 brought another decline in sales but an increase in ridership.
The company said in its latest earnings report Tuesday that sales fell 4.3 percent in 2019, with declines in the United States and every other region except the Asia-Pacific.
The Milwaukee-based motorcycle maker has reported sales declines for 12 consecutive quarters. But its 2019 fourth quarter decline was just 1.4 percent, the lowest quarterly decline in that three-year period.
CEO Matt Levatich said the fourth quarter results were in line with company expectations and pointed toward “increased business stability.” He said 2020 will be a “pivotal year” as the company looks to turn around sales.
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Harley has been working to attract more riders, especially younger ones, through ongoing marketing campaigns and a wider range of motorcycles, including electric models like the LiveWire.
The company said U.S. ridership had increased to around 3.1 million, but Levatich said Harley-Davidson would still ramp up its campaign to attract and retain new riders.
“For 100-plus years we’ve woken up every morning and told ourselves our job is to make great motorcycles, and we did a great job at that. It is quite a different challenge to wake up in the morning and say we now need to build riders,” he said. “That requires different skills, different capabilities and different mindsets, and a different cultural attitude.”
In the U.S., that has meant attracting younger riders to replace those who age and stop riding. But Levatich also said the company would focus on retaining younger riders, who “have raised their hand, took the time, invested the money, learned how to ride, purchased a motorcycle and tend to exit the sport within the first three years because they haven’t yet built the confidence necessary to become what we’re calling a committed rider.”
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The company is looking to grow its ridership in the U.S. to 4 million by 2027.
Harley-Davidson reported fourth-quarter earnings of $13.5 million and a profit of 9 cents per share. The results beat Wall Street expectations. The average estimate of five analysts surveyed by Zacks Investment Research was for earnings of 5 cents per share.
The motorcycle maker posted revenue of $1.07 billion in the period. Its adjusted revenue was $874.1 million, which did not meet Wall Street forecasts. Six analysts surveyed by Zacks expected $928.1 million.
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For the year, the company reported profit of $423.6 million, or $2.68 per share. Revenue was reported as $4.57 billion.
Harley-Davidson shares have fallen slightly more than 6 percent since the beginning of the year, while the Standard & Poor’s 500 Index has stayed nearly flat.