Is Harley Davidson Going to Survive?

Much has been written about the present state of Harley Davidson. For many who have invested in the product, the question remains. Will Harley Davidson survive? CEO Jochen Zeitz has stated to the publication, Dezeen, that Harley intends on going completely electric, which begs a ton of questions. Notably? Does this mean that Harley Davidson intends on ending the support for existing combustion engines at some point in the not too distant future?

The facts tell the story.

https://www.statista.com/outlook/mmo/motorcycles/worldwide,

• The projected revenue in the Motorcycles market for Worldwide is expected to reach US$136.30bn in 2023.
• It is anticipated that the revenue will show an annual growth rate (CAGR 2023-2028) of 3.79%, resulting in a projected market volume of US$164.20bn by 2028.
• In 2023, the projected revenue in the Motorcycles market in North America is estimated to reach US$8.49bn.
• The market is expected to experience an annual growth rate (CAGR 2023-2028) of 2.83%, resulting in a projected market volume of US$9.76bn by 2028.

According to industry experts Harley, as we know and knew it, is in trouble. In the last twenty years, Harley’s sales globally have been cut by half. Year on year, profits showed a 24% reduction. Sales fell another 16% year over year through the third quarter of 2023, and in Asia, sales fell by 24%. Livewire was sold in 2022 and has formed a separate company, due mostly to the fact that Harley Davidson owners wouldn’t buy the product, and it’s sales failures were affecting Harley Davidson itself.

Harley is not alone in its sales losses in North America as Indian also suffered more than a 16% reduction in sales. What has been clear for over a decade is that the cruiser and soft tail market has been shrinking as adventure motorcycles have risen and the age of the riders in Harley’s traditional sales segment age, expire or stop riding. What works against Harley most notably has been how young riders without the financial resources or the historical attachment to Harley are simply buying foreign motorcycles. Harley, between 2019 and 2023 has sold less than 3000 Livewire units, with as many as half of them having to be heavily discounted. The spinoff of Livewire in 2022 further reduced revenues at Harley Davidson by 11%. In total, to date, Livewire has sold less than 3000 motorcycles worldwide and wholesaled between 750 and 2000 of those units. Livewires operating loss for 2023 is between 115 and 123 million dollars U.S. According to Adventure Rider, Harley (Livewire) shipped a total of 33 Livewire units, an 84% decrease in sales from the same quarter the previous year. Harley Davidson’s remaining Livewire One’s didn’t make a single sale.

Worse, most of Livewire’s 7 million dollar revenue did not come from motorcycles but from the company’s STACYC electric balance bikes for children. Harley, and Livewire are banking on its new S2 Del Mar, middleweight electric with an MSRP of $15,500 in the United States.

So what will happen if sales fall below the projected 1000 units next year? As Adventure Rider states, “You have to wonder how long Harley will continue propping up the brand with its own money, or how long investors will wait to get something for their investment dollars.”

Time will tell. What do you think Harley should do? Let me know in your comments. Please no bashing either way, as Harley’s woes aren’t good for the motorcycle industry as a whole.

Ciao.