Listen: Hurting Harley Broaches $1.6 Billion Turnaround Plan
"Uh from wondering I'm David Brown and this is business worse daily on this Thursday October third when you think of have motorcycles which brand POPs to mind it could be the one time king of the Hill Harley Davidson but that's more likely if you're obvious certain age for the past several years. Here's the muscle bound. Company has been fighting for the industry leadership at once took nearly for granted upstarts like it's revived former rival. Indian have been looming larger Juryman harleys rear view Mirrors Harley sales and profits have been sinking for the last five years and this quarter has been one of its worst with sales dropping almost eight and a half percent compared to a year ago last week. The company announced an aggressive expensive turnaround plan called more roads Harley Davidson it it intends to spend one point six billion dollars over the next four years to expand not only its own customer base but motorcycle riding in general it. Lynch produce new products especially its fleet of electric vehicles led by the livewire expand access around the globe build new smaller urban dealerships and create experiences experiences intended to introduce kids and young adults to the joys of writing ultimately Harley promises the more roads plan will increase harleys tribe from its existing assisting three million riders to four but analysts are quick to label the turnaround plan a tough uphill climb. The company blames its problems on a soft market for motorcycles and indeed. Americans bought three hundred seventy thousand motorcycles in two thousand sixteen. That's only half as many as they had ten years earlier. millennials especially city-dwellers don't seem to be buying bikes especially those big heavy touring bikes that made Harley famous some blame the downturn on ridesharing which reduces the need to own transportation and of course there are those hefty school loans which shrink household budgets but some of hardy's troubles are frankly harleys or lease alone. The company's existing ridership is aging and younger riders. Just aren't filling in the gaps. It's new livewire. Electric bike starts at thirty thousand dollars hours as one writer pointed out almost the cost of low in Tesla early this year we pointed out that Harley is on a high wire a tricky balancing act between keeping its existing existing customers happy while trying to attract new younger writers and impress investors who think electric bikes the industry's future so far. Harley has not shown shown that it can navigate that delicate tightrope furthermore those shrinking motorcycle market isn't affecting all companies equally if as CNBC claimed aimed late last year millennials are killing motorcycles. We'll what about Harley's rival Indian wouldn't they be suffering too with the help of the newly launched. FDR Twelve hundred motorcycle asleep bike style like a flat track racer. Indians motorcycle sales grew fifteen percent of its second quarter to two hundred million million dollars. It's prophets also rose by two million that suggests Indian which is owned by Polaris Industries is doing a better job than Harley creating relevant well-priced well priced products the FDR twelve hundred retails for only thirteen to sixteen thousand dollars a far cry from some of Harleys gasp worthy list prices prices still it remains to be seen whether Hardee's big plan to expand the market could work over time the company that's been in business indeed as an American an icon since nineteen zero three as no slouch but it may take all the muscle harleys God along with a boatload of patience and and maybe you turn on those prices turn things around wondering this Business Business Wars Daily today is episode number two hundred and ninety nine curious about the history of Harley Davidson Checkout are seven part series Harley Biker Acura sits on our sister. Show business wars subscribed wherever you listen to podcasts. I'm David Brown back with you tomorrow"