Harley-Davidson 2021. Global Sales at the second-worse level out of last 11 years

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Harley-Davidson global sales are slow recovering. In the first half sales have been 117.057, up 24.2% vs the 2020. However, they are down 3.8% vs the 2019. So, this was the second-worse first half out of last 11.

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. 

Harley-Davidson Global Registrations Trend and Performance

Following the huge fall reported in the 2020, this year Harley-Davidson will report a growth, first time after 11 years. The growth had been carefully planned, shifting activities, launch of Model Year, new models from the second half 2020 to this year. In addition, the market conditions are very favorable in North America, while in Europe, the increase of duties for goods imported from USA will penalize the manufacturer, hoping that Biden administration will be able to go over the Trumps commercial battle against Europe.

To analyze 2021 performance will require to bear in mind the 2019 pre-covid or – in case of HD, pre-restructuring plan, data, not forgetting that the 2019 was lower sales level in years and to be back at its sales level does not represent a milestone.

Locking at sales, the 2021 started badly with sales below the 2020 in the first tow months. However the comparison with the very low sales reported in March 2020, allowed Harley-Davidson to end the first quarter with a 16.2% improvement over the previous year.

In the second quarter sales accelerated, even thanks to the launch of the Panamerica 1250, the new adventure model launched at a very aggressive price. So quarterly sales increased 30.2%.

As consequence, the first half sales have been 117.057, up 24.2% vs the 2020. However, they are down 3.8% vs the 2019. So, this was the second-worse first half out of last 11.

The main lost vs the 2019 are concentrated in Europe, where Harley-Davidson is selling 43.2% less than two years ago. Other critical region is the Indian (-92.8% vs 2019).

In the 2020, global sales collapsed (-18%)

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 Adventure segment, totally new for Harley-Davidson.