You know, people just love to dump on Harley-Davidson. It’s an all-or-nothing thing: you either live and breathe Hogs, without acknowledging any other brands, or you ridicule Harley as your Old Man’s bike, wheezing to keep up and dripping oil to mark its territory.
(There are a couple of rules for Harley ownership, though. One is that if somebody asks what bike you ride, the correct response is “a Low Rider,” or whatever. Don’t say “a Harley-Davidson Low Rider,” because it should just be a given that you would ride a Harley. Well, duh. The other is that when a kid asks how fast it goes, the correct response is “just as fast as I want it to go.” Which is a macho way of saying not very fast at all, lest the fillings shake from your teeth. I know this because I own a Harley, an ’08 Low Rider, which I’m telling you in the interest of full disclosure: I’m about to try to defend the MoCo against its many detractors, which isn’t going to be easy.)
Harley-Davidson announced its fourth quarter and yearly sales figures in a conference call last week, and most of the media, including us at CMG, piled on to the gloomy statistics. “Once again, they aren’t encouraging … This was the fifth straight quarter of decline for Harley-Davidson,” we reported at CMG. “Earnings show weakness beneath the surface,” said Revzilla. And Jalopnik, of course, spared no mercy: “Harley-Davidson’s slow decline is getting hard to watch,” it said. “It’s desperately trying to prop up U.S. sales, but the LiveWire hasn’t been selling great, and its core demo is aging out.”
All this is true and indisputable. In fact, it’s worse, because every year, Harley sells fewer and fewer motorcycles. Back in the heady days of 2006, just before the recession, Harley sold nearly 350,000 bikes, but last year it sold 218,273 bikes worldwide. That was the smallest number sold outside the US this decade, and the smallest number in the States, its major market, this century. Clearly, something must be done.
If this sounds familiar to some, it’s because Harley-Davidson’s experience is very similar to Jaguar Land Rover. Consider this: Both brands make vehicles that are quintessentially patriotic, with Harleys being pure Americana, and both Jaguars and Land Rovers being British to the core. For JLR, that goodwill toward the brand was not enough to compensate for building crappy, expensive, outdated vehicles. It struggled for decades with a lack of investment and a wayward vision. Ford Motor Company bought Jaguar in 1990, and then Land Rover in 2000, but the Detroit auto maker had no money to spare and tried to sell the cars on their name alone.
“We’re so upper-crust British!” said Jaguar, and “we’re so stiff-upper-lip British!” said Land Rover. And it wasn’t enough for their unreliable vehicles to appeal to the rest of the world. Even in the U.K., drivers shifted to BMWs and Mercedes. Then in 2008, JLR was sold to Tata Motors of India, which invested a billion dollars in research and development, and the vehicles began to improve.
More to the point, Jaguar’s designers looked around and noticed that few buyers wanted the large sedans and coupes the company was selling – they wanted SUVs. Porsche had already added the Cayenne SUV to its sports car lineup, and although purists were appalled, the Cayenne quickly became Porsche’s best-seller. It was the same thing at every other car company: people wanted SUVs. Jaguar was very late to the party with its F-Pace SUV, announced in 2015, but it’s now the company’s best-seller. And for Land-Rover, which has watched Jeep eat its lunch around the world for at least the last decade, there’s an all-new Defender this year, finally.
Jaguar Land Rover is now giving the people what they want, not what it thinks they should have. Maybe somebody at Harley-Davidson recognized this a couple of years ago, because Harley is finally preparing to do the same thing. Yes, there are still buyers for the big cruisers and tourers, just as there are still buyers for Porsche 911s and Boxsters, but the trend is to more versatile adventure bikes, and naked bikes. All the other motorcycle makers have known this for years, but Harley is only just now getting ready to introduce its Pan America adventure bike and its Bronx naked bike, sometime later this year.
Armchair critics have been swift to dump on the new bikes, but Harley’s showing a willingness to think outside of its 45-degree V-twin box. Yes, the bikes have a V-twin, but it’s 60 degrees and water-cooled. So was the V-Rod of course, but that was a quirky machine, far more niche than these upcoming motorcycles. The new engine, with a whole new philosophy behind the bikes’ design and purpose, is exactly what Harley needs.
There’ve been plenty of attempts in the past to save Harley: Buell sportbikes, the radical V-Rod, the small displacement Street motorcycles. None have worked to turn the company around because it’s always been centred on the heavyweight cruisers that are bought by hairy heavyweight bikers. Now, all the media focus is on the electric Livewire and the decriers are thrilled that it’s too expensive and too limited in range to appeal to more than just a few early adopters.
The Livewire, however, was never meant to sell in huge volumes. It was meant to show what’s possible, and to lead the way to a whole new electric line-up that complements, but does not replace, the rest of the MoCo’s bikes. As the new president of Harley-Davidson Canada told me last year, “If I compare it to Tesla, they didn’t launch the Model 3 – they launched the Model S. They launched a $100,000-plus car, and then they went downstream as they evolved the technology. We’re not expecting this bike to be mainstream; it’s not a bike for everyone. It’s a motorcycle for those who have the means and who want the experience that it provides, and I think we’ll have plenty of customers for it.”
The “plenty of customers” bit might be a little ambitious for a $40,000-plus bike, but it’s good that Harley is ambitious at last. It’s not resting on what it has, because that’s falling away. It’s invested all kinds of money in a 10-year turn-around strategy that’s aimed at a global market, and it’s very clear that this is the pivotal year. It’s the year for the Livewire to be seen on the road, and for the Pan-America and the Bronx to debut and prove themselves against the competition.
There’s plenty more to come, but is it enough? We’ll find out soon. These things take a long time – Jaguar Land Rover isn’t out of the financial woods yet, but it’s also invested heavily in electric vehicles and the all-electric I-Pace was named World Car of the Year for 2019, as well as AJAC’s Canadian Utility Vehicle of the Year. So maybe this is the turn-around, and 2021 will finally be Harley-Davidson’s year. Let’s hope so.
Lets start with the v-Rod you had to be a master bike mechanic and have a full shop just to service the bike and the livewire wtf email me and i,ll send all you tree huggers an audio tape of me farting on a snare drum while you ride to the next charging station harley was king of the hill for many generations and got arrogant with sales down perhaps it will humble them and bring their prices down for the junk they have been asking top dollar for plastic tappit blocks for one example there is plenty harley could do to bring their sales up bring back the cross bones but make it chopped out drop fender you get the idea or make a crotch rocket sport bike style or make a 2 stroke 500cc motocross machine styled like the old ironhead hill climbers just step outside the norm
Another point is that pot legalization put a lot of small time dealers out of business . Are we seeing how big a share that was?
The Jag/Land Rover comparison doesn’t hold entirely. For many,, there were Harley Davidsons and then there were those other things with two wheels and a motor. You couldn’t rightly call them motorcycles. As British as the Jag/Land Rovers were, I think their owners would acknowledge that there were other cars out there which were legitimate. Maybe not as good but still cars nonetheless. This is the level of prejudice that HD has to contend with. This prejudice has both sold their bikes and cost them sales. Now it is more the latter. But I hope they make it selling electrics or Bonxes or whatever.
harley has the pan and bronx bike. Meanwhile Indian has the FTR1200.
Love that Indian.
harley’s new motor looks like it got to hot and lost 30% of it’s detail.
I’m not American, so the brand image they worked so hard to build does nothing for me. In fact, its more of a turn-off than anything. But that brand is very strong and I think it will be difficult for those who buy in, to accept the new products, and for those they are looking to attract, to believe HD can evolve.
As others have said, now that they are entering new markets, they need to be competitive with those already there. Nothing we have seen indicates that they will be competitive regarding price, weight and performance. Comparing the Livewire to the Tesla Model S is not relevant. When the S came out, it had the highest level of luxury and the longest range of any electric car of its time, justifying its higher price. When introduced, the Livewire didn’t offer the same features or range of the Zero SRF, but cost 1/3 more.
I don’t support HD’s R&D methodology. Absorb IP from innovative start-ups (Mission, Alta), then toss them to the curb to die once they have what they want. I’d be happy to watch them continue to falter because of this alone.
Maybe they should stop blindly flinging stuff at the wall to see what sticks, and focus on what they know best – T-shirts.
LOL!
I think the problem goes beyond HD, to the entire motorcycle market in North America, where bikes are considered “recreational” vehicles rather than a legitimate form of daily transport as in many other parts of the world. At least with the automotive market, you’ve seen a clear trend away from sedans to SUVs/cross overs/pick-ups that you can at least plan around. In the (non-HD) motorcycle dealerships I frequent in my town, you can see evidence of market evolution – drastically fewer cruisers and sportbikes, more ADV bikes and naked/café racers on offer. Problem is that the latter, supposedly “hot” segments don’t seem to be selling that well either except for a few segment benchmarks like the big BMW GS models. It’s a tough business to be in today, not only for HD.
Others have pointed out that the “faithful”, both inside and outside the dealerships have little regard for the new bikes or potential riders of same. Obviously this is something that will fade as time goes on.
The real “stinking albatross” (to appropriate someone else’s’ phrase) is the brand itself. Does the new or young motorcycle buyer associate the bar and shield logo with their desired personal-brand message to the rest of the world? The cache of that brand is pretty focussed, and to many of the generation coming after ours doesn’t carry with it the pull of history or image that our generations revere or even acknowledge as valuable/significant.
If they’re trying to change the brand image to maintain their sales level and prestige they’re MANY years too late.
My personal opinion is that there will ALWAYS be those who appreciate what the MOCO offers, both as a brand and as a functional machine (I could be one of them). It’s just that they’ll have to get used to being a smaller, less significant corporate entity selling fewer units.
I don’t believe they/we have seen the bottom yet, nor do I think they’ve really even contemplated how far they will fall.
Harley will be fine. The nay sayers are always the loudest voice in the beginning until they look around and see no ones paying attention to them anymore. As long as Harley continues development and produces a quality product people will buy their new ADV bike. Just like noted with Porsche. Heads were rolling when they announced an suv. Now, 15 or so years later Ferrari is coming out with one. Better late than never. And corvette is exactly like HD. They kept the same tired old formula for all their “fan base” although their real fans already had vettes so they weren’t buying the new ones. Now a new mid engine comes out and it already won car of the year. Not a HD guy but glad to see innovation and to keep and moto brand alive.
The mid engine vette is a slow motion trainwreck. Almost a year since the intro and still no deliveries. There are issues, and gm doesn’t have the money to fix them.
GM had to go to mid engine after camaro & mustang got irs. Unfortunately the bankruptcy and costcutting left them without the means. If customers ever get their vet, it will be a half finished kit car.
About Harley’s future from my POV: Mark mentions the V-Rod, but it tried to be a Harley, and for the hardcore Harley market, it just wasn’t, so it didn’t sell. The proposed new 60-degree twins are not trying to be Harleys. They’re something completely new, modern, and very interesting. I think they will introduce the brand to new-to-the-brand buyers. Those who hate H-D will always hate them, and will stay away from them like that beer-branded virus. But just as the company’s biggest demographic is “ageing out”, so will they.
Sure, there will be some lean years, but the company has gone through much worse. I think it has finally acknowledged its weaknesses, and will address them with this new platform, without alienating its “core” geriatrics by offering its traditional 45-degree twins — as long as the EPA allows them. And the company will probably come back down to Earth and offer an affordable electric bike, too.
[…] If this sounds familiar to some, it's because Harley-Davidson's experience is very similar to Jaguar Land Rover. Consider this: Both brands make … View full source […]
[…] And for Land-Rover, which has watched Jeep eat its lunch around the world for at least the last decade, there's an all-new Defender this year, finally. View full source […]
I think H-D’s real problem is going to be getting used to playing in market segments where, unlike in the heavy cruiser/bagger segment, they are not the acknowledged leader. Until recently, at least (with the rise of Indian), if you wanted a cruiser or bagger, there were only two real choices – H-D and everyone else some distance behind. But with something like the Bronx or Pan America, they’re going to be going head to head with a lot of established players, in a market where the bar and shield doesn’t have any particular cachet.
It seems to me that they are ten years too late. If you look at most brands, they have a bike for everyone, from beginners to experts. HD has always concentrated on BFCs (Big Fat Cruisers), everything else is second rate. as noted above, the salespeople turn their nose up at anything 1200cc or smaller (including Sportsters). The Street models were spurned by the dealers as “not real Harleys” and never have sold well, even as the Motor Co was trying to attract new riders. HD has to look hard at training and maybe hiring salespeople that understand that they HAVE to sell the entire line, or they will be bought by another powersports company that can make it work.
BUELL
“BUELL”
Eric’s had more horses shot out from underneath him than Custer. Last I heard he was in the bicycle business.
Buell in the bicycle business? You mean just like Harley Davidson?
https://www.harley-davidson.com/us/en/motorcycles/future-vehicles/e-bicycles.html
I’m surprised this article made no mention of HD’s bicycle aspirations, and how incongruous it is with their current image.
Did they kick Buell to the curb because HD knew they were going to develop a new line of bikes that include a sportier model and an adventure bike that were branded fully HD, or were they just paying attention to the market?
“There also has to be a major change in attitude at the dealer level.” Definitely. Many HD dealers are staffed by the old-school Harley types who have no interest in the new bikes.
I see no evidence of this in the dealerships I’m at. What I see is the SOA generation, for the most part, who can’t afford the bikes themselves and therefore don’t have the passion the crusty old dudes did.
I think the Jaguar comparison is a good one. Take one look at the Jag SUV and you are like “DAMN-That is a great looking vehicle”! Now take a look at the Harley Pan-America….
I am honestly hoping for their success. I just cannot see how the Pan-America is going to get them there.
The Motor Company faces the same problems as the mainstream North American automakers – how to remain relevant in the 21st century.
$50K machinery is not it, the time has come to go head-to-head with the other world guys, both European and Japanese. Middleweight machines done offshore at realistic pricing ? The Sportster remains their ‘beginner bike’, the Street 500/750s notwithstanding.
There also has to be a major change in attitude at the dealer level. Don’t alienate younger buyers when they walk in the door by ignoring them.
Don’t kid yourself, H-D is nowhere near the dire straits they were in the AMF years, they are still formidable BUT market speak doesn’t replace stuff that people really want to buy.
End of rant – next ?