Harley-Davidson 2020. Global sales collapsed (-18%) with concerns on “rewire” plan

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Harley-Davidson global sales declined 18% in 2020 with only 180.000 registrations and losing the leadership as premium brand after over 50 years. A sharp lost of market share in USA and Europe cannot be justified by any new strategy and the start of “rewire” plan looks awful.

McD tracks new vehicles registrations across the World (over 80 countries), reporting data on calendar year. When you wish to compare data reported by us to those declared by the manufacturers, consider they usually report their “sales” (vehicles invoiced), which are usually different from “registrations”, accordingly with their fiscal year split. 

Following ten years of consecutive revenue, sales and profit decline, the 2020 represented a sharp milestone for the American motorcycles icon. From one side, sales declined as never before in a single year, while from the other, a new Management is on board with a new strategic plan developed and now in place.

Starting from sales performance, they have been really ugly, considering the not so negative trend reported by the regions where Harley-Davidson makes the most of volumes, North America and Europe. These regions have been resilient to the covid19 crisis – while with different segment mixes – while Harley-Davidson fell down sharply, losing market share and -at least in Europe – part of distribution network strength.

Global registrations has been so below the expectations that the official HD release did not mentioned. We must say the evidence of data we collect in over 80 markets, with a final verdict of 180.336 units, down 18%.

In US  sales declined 19.2%, while the total industry (including ATVs and off road) was positive.

In Europe sales fell 16.3%, while the industry was flat from the previous year.

Just in few countries Harley-Davidson reported a positive 2020 score: China, Turkey, Russia, New Zealand.

Harley-Davidson

The “rewire” turnaround strategy

While revealing the contents of the Rewire strategy, the new Harley-Davidson management is surprising at any step.

Following years of substantial immobility when the company was losing terrain both in terms of sales and profit, explaining to the market that the “guilty” was the traditional Harley-Davidson client, becoming older and older while new generations were no more interested in the two-wheelers, the new management is taking fast and immediate actions.

Jochen Zeitz the new CEO, who took over in February, is hailed for turning around the Puma brand’s near-bankrupt business.

Called to rethink Harley-Davidson, his first step in the five years turnaround strategy consists in cutting cost, considered unnecessary in the entire global organization, restructuring process and functions, while aiming to generate new ideas to revamp the brand.

In all, the restructuring will eliminate 700 positions globally. It will result in a $50 million restructuring charge in 2020.

In the largest motorcycles market in the World, India, Harley is closing the plant and delegate both production and distribution to Hero Motor, the largest Indian manufacturer.

Meanwhile it was announced the intention to quit 39 countries with low volume/low profit, while the company will concentrate the efforts in the top 50 markets. Among these, 17 will be covered with external distributors and 33 with direct subsidiaries.

The product planning has been moved ahead by six months and there are rumors that only one new model will be launched in the 2021, entering the new for Harley-Davidson segment, the Adventure.