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[ZVO]

Less bikes won't necessarily create demand.

[smkymtnboy]

the one dealer I have talked to says his sales are ahead for 2015 by a good margin compared to years past. I realize this just a very small part of the big picture.

[JCZ]

I suspect that much of this is inventory management. The motor trade runs on manufactures financing bikes/cars whilst it's on dealers shop floors for up to 90 days. After that, the dealer will be expected to pay the manufacturer and get their floor stock financed through a bank or other credit facility (a stocking facility). Whilst interest rates are low, not too much of an issue but with the Fed signalling a potential rate rise in the coming quarters, dealers do not want to be stuck with a large stocking facility and see their debt servicing costs go up.

The big challenge for Harley is that their core franchise is getting older and less is being spent on P&A. The Street is clearly a response to that, but will harley be able to move first time Harley buyers up their value chain to the larger engined models and spending on 'customization'. I think the x-wire is a side show, a good one which they can spin off into their twin models, for example, the brakes on a Chevy now are far better because they developed electric powered cars that had no engine breaking, so brakes had to last longer and be more powerful. Good trickle down technology to more traditional vehicles.

Harley still have the time to make the required changes, Rushmore part of that granted. The brand and whole lifestyle is an incredibly valuable asset as I am sure that Polaris is understanding and with over 50% of the US market, Harley have a delicate balancing act to on board the next generation without alienating the cash flow attached to their legacy market place.

Which is why CEO's (good ones anyway) deserve to b rewarded for making long term strategic decisions rather than short term revenue generation to keep the scribblers (analysts and investors) happy.

Just my 2 cents worth to an interesting debate.

With all due respect Brit Guy.....this all sounds like it's coming from a CEO to justify their compensation discrepency.  It takes the entire team from the guy that's sweeping the floors at night all the way up to the CEO to get the job done.  The CEO alone can not get the job done.....regardless of what they're paying him.

If this sounds like it's coming from a low level managment blue collar worker......it is.  And I do my job just as through, compitent and diligent as the guy sitting behind the desk in the crystal palace.  While I would expect a CEO to make more than I, a lot more....I also believe that the disparity has grown rediculously out of preportion and is not warranted or justified.

My post earlier was kind of tongue in cheek, posted with humor.  However, having said that, based on Harley's history of controlling production and inventory (remember the 100th anniversary production shifts they made) there may be some unknow validity to my above post. 

[BritGuy]

JCZ, I get just as pissed with CEO's who destroy companies, or just crank the handle on an existing 'cash cow' and get hugely rewarded for it. Too many stories of corporate greed where everyone suffers, all employees and ultimately their customers.

I do believe that visionary CEO's deserve to be rewarded and the good ones ensure that this get's distributed fairly. Just look at John Bloor and what he has managed with Triumph. Took a stale old brand with tanking sales and made it a force to be reckoned with. His investment capital, his risk. Clearly he needs good people around him to develop and execute such a strategy, but without his vision and risk taking, many jobs in the UK and else where would have been lost.

Good CEO's know that they need good people throughout the organization. It's like the Kennedy story when he asked a janitor what he did in NASA, his response? 'I put men on the moon'. That sense of inclusion gets the job done from shop floor to management. Few achieve it, but those that do are ultimately successful.....for everyone.

Probably not the place to get into a debate over how companies are managed and financed, and the last thing I wanted to do was cause any offence. But I do think that the challenges facing corporate Harley are very real and will require some fairly major changes.

Just my personal opinion   

[skippy]

that's good may make our bike value go up ... on another note i see a lot of Indians around Charlotte NC saw some in Greensboro  with the big wheel package  and  lots of customization ....  big $ being spent on Indians...  also seeing lots of the tricked out Victory

[dlaws01]

Well they can't put a Tariff against Polaris LoL but seriously is Vic/Indian selling any even with the discounts???

Just for info, there's just about as many new Indians as there are H-D's sitting out in the parking lot at work when I go in.

[Dr.D]

SMHD in Maryville TN is sell the chit out of them. It is ridiculous how they are selling bikes all day long every day. I should try and get a number to post on here. They have no fear in taking stock bike having it painted and dressed to the gills with chrome or black and selling it for 13K OVER msrp.

Colbach HD in Morristown only 30 miles down the road is dead as all get out. they still are of the old school that if it ain't black it ain't the right color. They do have so bikes with color but I do n to understand the difference in sales activity?

I think they are making to many bikes and we are sucking them up. It is now hard to trade a bike with over 50'000 miles as it seems to be disposable at that time. Really now are Harleys only valuable to that milage??? It is a disease of this culture to always have to have the new improved. Oh i am one but not proud of that.

[D-N-D]

After 2003 there were ( Inventory ) bikes leftover every year and seemed like more and more each year ?? they need to do something besides discounting the leftover bikes, make less inventory create demand sounds like pre 2003 get in line and pay MSRP.

[mark]

I posted this in another discussion thread - HD's problem is one of mathematics.  HD's resurgence in the late 1980s was fueled by the baby boomer generation and that population is beginning to age away.  Unfortunately for HD, there are not enough Gen Xers to fill the gap.  Ever wonder why HD has introduced so many different Sporters and the new Street 500 & 750?  For comparison: HD sales for 2006, when compared to 2012, are off 30%. 

[grc]

After 2003 there were ( Inventory ) bikes leftover every year and seemed like more and more each year ?? they need to do something besides discounting the leftover bikes, make less inventory create demand sounds like pre 2003 get in line and pay MSRP.

That's what they've been doing since 2008, and they still have leftover bikes at the end of the model years.  They still haven't come up with a way to accurately assess demand ahead of time, so even though they have reduced capacity and had some downtime, they still manage to create excess inventory.  Sadly, they also keep using a bad distribution model that gives extra bikes to places that don't really need them, while starving small dealers who could sell more if they had them.  The only good dealer in my area voluntarily retired and shut the doors a few years back because Harley wouldn't commit to giving him more allocation, even after he built the new building they pushed for, and then within a few more years added on and doubled the space.  The big guys won't give up the allocation they've earned from previous years of high sales, even though they no longer have as many customers, because to do so would leave them less allocation in the future if something were to happen and the market returned to the late '90's situation of waiting lists and selling anything that wasn't bolted or welded to the floor.

I haven't seen anything yet that would indicate the good ol' days are returning, now or maybe ever.  I expect to see more dealerships go away, and Harley have to further reduce production capacity.  A big chunk of the boomers who fueled the big rise of Harley are now like me, old and grey and not riding much anymore.  I don't see the same passion for motorcycling in the millenials, and of course they are a much smaller group as well. 

The next 20 years should be very interesting.  Harley shareholders need to hope the board comes up with a much better management team than the last two.

JMHO - Jerry

[HighOnHD]

That's what they've been doing since 2008, and they still have leftover bikes at the end of the model years.  They still haven't come up with a way to accurately assess demand ahead of time, so even though they have reduced capacity and had some downtime, they still manage to create excess inventory.  Sadly, they also keep using a bad distribution model that gives extra bikes to places that don't really need them, while starving small dealers who could sell more if they had them.  The only good dealer in my area voluntarily retired and shut the doors a few years back because Harley wouldn't commit to giving him more allocation, even after he built the new building they pushed for, and then within a few more years added on and doubled the space.  The big guys won't give up the allocation they've earned from previous years of high sales, even though they no longer have as many customers, because to do so would leave them less allocation in the future if something were to happen and the market returned to the late '90's situation of waiting lists and selling anything that wasn't bolted or welded to the floor.

I haven't seen anything yet that would indicate the good ol' days are returning, now or maybe ever.  I expect to see more dealerships go away, and Harley have to further reduce production capacity.  A big chunk of the boomers who fueled the big rise of Harley are now like me, old and grey and not riding much anymore.  I don't see the same passion for motorcycling in the millenials, and of course they are a much smaller group as well. 

The next 20 years should be very interesting.  Harley shareholders need to hope the board comes up with a much better management team than the last two.

JMHO - Jerry

Aha! Now I understand. Not riding as much anymore = "AKA Grouchy Old Fart"!!

I'm grey and definitely getting older and grouchier too! Not slowing down quite yet on the riding and my wife will hate how grouchy I am going to be when I do. 

[FLSTFI Dave]

SMHD in Maryville TN is sell the chit out of them. It is ridiculous how they are selling bikes all day long every day. I should try and get a number to post on here. They have no fear in taking stock bike having it painted and dressed to the gills with chrome or black and selling it for 13K OVER msrp.

Colbach HD in Morristown only 30 miles down the road is dead as all get out. they still are of the old school that if it ain't black it ain't the right color. They do have so bikes with color but I do n to understand the difference in sales activity?

I think they are making to many bikes and we are sucking them up. It is now hard to trade a bike with over 50'000 miles as it seems to be disposable at that time. Really now are Harleys only valuable to that milage??? It is a disease of this culture to always have to have the new improved. Oh i am one but not proud of that.

They also sell plain black ones.  Bought my wife's 15 Road Glide Special there.  Easy to put another 12K into the bike with out doing a lot.  Custom Paint, Chrome wheels, Chrome Forks, and rotors.  Performance front fork cartridges, CB, Phone Adapter, garage door opener, luggage rack, sissy bar and back rest, pipes, and tuner.  Rear bag guards, Led lights for turn signals and bullets in back.  Extra bag lights for better visibility. 

Great looking bike but I will loose way more on it, than my CVO's

[Dr.D]

They also sell plain black ones.  Bought my wife's 15 Road Glide Special there.  Easy to put another 12K into the bike with out doing a lot.  Custom Paint, Chrome wheels, Chrome Forks, and rotors.  Performance front fork cartridges, CB, Phone Adapter, garage door opener, luggage rack, sissy bar and back rest, pipes, and tuner.  Rear bag guards, Led lights for turn signals and bullets in back.  Extra bag lights for better visibility. 

Great looking bike but I will loose way more on it, than my CVO's

I just bought one of their custom paint all decked out SGS for my wife. Never can trade that bike for sure.

[FLSTFI Dave]

I just bought one of their custom paint all decked out SGS for my wife. Never can trade that bike for sure.

I understand.

My plan is like I did on her Street glide, it had the custom paint and fork legs and so on.  When it hit 45K miles I traded it on a plain black one, and we with SMHD knowing swapped all the accessories to the new bike, including the paint.

So, I know the body and such will not change for several model years.  When she hits 40~45 K miles we will trade and keep all the custom stuff. It helps spread the cost of a couple bikes.  Keeps the wife happy with her custom purple paint.

[Dr.D]

I understand.

My plan is like I did on her Street glide, it had the custom paint and fork legs and so on.  When it hit 45K miles I traded it on a plain black one, and we with SMHD knowing swapped all the accessories to the new bike, including the paint.

So, I know the body and such will not change for several model years.  When she hits 40~45 K miles we will trade and keep all the custom stuff. It helps spread the cost of a couple bikes.  Keeps the wife happy with her custom purple paint.

That is very savvy. Happy wife is good but not free.