With its motorcycle sales dealt a blow by the pandemic, Harley-Davidson Inc. on Tuesday said it lost money in the recent fiscal quarter and that it was narrowing its product lineup and exiting some foreign markets.
For the three-month period ended June 30, Harley posted a loss of $92 million, or 60 cents per share, compared with a profit of $195.6 million or $1.23 per share in the same quarter a year earlier.
Analysts expected Harley to earn a profit of between about 10 and 18 cents per share.
The company’s U.S. retail motorcycle sales fell 27% in the quarter, the steepest decline in at least six years and partly attributed to COVID-19 production cutbacks and temporary closures of dealerships this spring.
Sales in Latin America were down 51% and declined 30% in the Europe, Middle East and Africa region.
Motorcycles and related products revenue fell 53% year-over-year to $669 million. Harley’s share of the U.S. heavyweight bike market was 38.5%, down 8 percentage points from a year earlier and off significantly from previous years.
“A total rewire is necessary to make Harley-Davidson a high-performance company,” Jochen Zeitz, chairman, president and CEO said in a conference call with analysts, referring to the Rewire project aimed at rejuvenating Harley.
“The company has seen five consecutive restructurings in order to sort of chase the downward trend in sales. That has affected morale and engagement by our team members around the world, which is totally understandable,” Zeitz said.
“As we worked through Rewire, it was very evident to me that we had lost our focus on the strength of our brand in favor of promotional activities which erode our value and the investment our riders make in our products.”Source…