www.CVOHARLEY.com
CVO Social => In The News => Topic started by: tazmun on October 17, 2017, 07:35:30 PM
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Seems like bad news again, 8.1% decline is the states!
The biggest hit this time was the touring bikes!
Sad state of affairs.
Hope things get better for the company Soon!
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Well, that should generate a lot of discussion across the financial world.
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Here's a link to the 3rd Quarter Results release to the Press. Not a pretty picture. They're convinced that the 100 new models (revamped) over 10 years strategy is the solution. Overall industry slumped per this release as well.
http://investor.harley-davidson.com/phoenix.zhtml?c=87981&p=irol-newsArticle&ID=2309025 (http://investor.harley-davidson.com/phoenix.zhtml?c=87981&p=irol-newsArticle&ID=2309025)
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Actually outperformed the segment in Q3 considerably with (8.1) vs (14.3)
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Actually outperformed the segment in Q3 considerably with (8.1) vs (14.3)
I don't quite get your meaning Alan. Quote "Harley-Davidson U.S. retail motorcycle sales were down 8.1 percent compared to the year-ago quarter, with the overall U.S. industry down 9.2 percent for the same period" - so compared to US industry, HD sucked less. The only (14.3%) statistic I saw in the press release was the reduction in 3rd Q sales compared to 2016.
Simon
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Shipments were down 14.3%. Inventory adjustment. Reaction to a declining market.
Different industry - I worked in a declining market for some of my career. We knew each year that fewer consumers would buy products in the categories we operated in. Not fun stuff, but companies can survive it. Total market each year drops. Ways to maintain or grow revenues - 1. buy competitors 2. when competitors go out of business take their market share 3. raise prices 4. outperform competitors. So far HD is using the 3rd option, but there is a buyer resistance point to that strategy, reading posts on this board indicates that for some (many?) they have already surpassed that price point. HD will also have to cut costs to maintain profits. If they don't they will not survive.
As total market for motorcycles continues to decline - and their is no indication that it will not, HD as market leader in large CC bikes is most vulnerable to losing market share. Indian is positioned to take more market share, the HD "magic 100 new bikes" strategy is worth watching. Depending on how severe this total market MC loss is is also an indicator of how many dealers will close. As the old movie actress said back in the 50s: "Fasten your seat belts, it's going to be a bumpy night."
Or....the generation that follows millennials will love motorcycling, millennials as they age will see the errors of their non 2 wheeled motorized ways, and new plants will have to be built to handle the demand. :P
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I guess raising the price of the CVO Limited was going to help. That must be why I see them sitting in the dealers with no buyers.
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Raising prices is a dangerous strategy, especially when there are chronic quality problems with the products. They can only cut costs so far, that is not sustainable. At some point they will need to accept that the overall market is in decline, and make a better product at a more competitive price point.
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Still beating the drum for the "100 new models" strategy, which is funny since they don't have anywhere near 100 models currently and never did. I'd still like to hear their definition of a "new model". Perhaps if you count each color as a separate model?
If they continue the current policies, high prices for low quality, they won't be around long enough to dream up 100 "new" models. Some auto companies that found themselves in similar situations tried the other approach, fire sale prices for stale low quality offerings, and that only worked in the very short term and only for the benefit of the executives. Based on what I've seen from the past couple CEO's at Harley, it's still all about short term thinking and short term profits and compensation packages.
JMHO - Jerry
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Shipments were down 14.3%. Inventory adjustment. Reaction to a declining market.
Different industry - I worked in a declining market for some of my career. We knew each year that fewer consumers would buy products in the categories we operated in. Not fun stuff, but companies can survive it. Total market each year drops. Ways to maintain or grow revenues - 1. buy competitors 2. when competitors go out of business take their market share 3. raise prices 4. outperform competitors. So far HD is using the 3rd option, but there is a buyer resistance point to that strategy, reading posts on this board indicates that for some (many?) they have already surpassed that price point. HD will also have to cut costs to maintain profits. If they don't they will not survive.
As total market for motorcycles continues to decline - and their is no indication that it will not, HD as market leader in large CC bikes is most vulnerable to losing market share. Indian is positioned to take more market share, the HD "magic 100 new bikes" strategy is worth watching. Depending on how severe this total market MC loss is is also an indicator of how many dealers will close. As the old movie actress said back in the 50s: "Fasten your seat belts, it's going to be a bumpy night."
Or....the generation that follows millennials will love motorcycling, millennials as they age will see the errors of their non 2 wheeled motorized ways, and new plants will have to be built to handle the demand. :P
The have had this strategy for years. Cutting quality to cut costs and not taking responsibility for their failed parts. Just passing the buck and forcing the customer to pay to correct the issue.
:oops: :nixweiss:
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The have had this strategy for years. Cutting quality to cut costs and not taking responsibility for their failed parts. Just passing the buck and forcing the customer to pay to correct the issue.
:oops: :nixweiss:
Yes more than a few examples of part failures are out there. Component failures can be very costly to them in the short run in the warranty period. After that the owner pays. There are a huge number of bikes out there with low miles. HD knows that, and those bikes are much less likely to fail because they are not ridden.
On cost reductions related to sales declines, HD will eventually close plants, layoff more workers, and where possible use robotics. They are outsourcing parts & have for years, if it's cheaper to buy it than make it. Currently they manufacture power train components (and other components) & then ship these to other assembly plants. Not efficient, there are reasons (unions are a part of the reason) for doing this. If they could simply streamline some production they could save millions a year without affecting product quality. Easier to say than to do.
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I don't quite get your meaning Alan. Quote "Harley-Davidson U.S. retail motorcycle sales were down 8.1 percent compared to the year-ago quarter, with the overall U.S. industry down 9.2 percent for the same period" - so compared to US industry, HD sucked less. The only (14.3%) statistic I saw in the press release was the reduction in 3rd Q sales compared to 2016.
Simon
Sorry Simon, I misread it..