Harley-Davidson tries to regain its coolness issue

Harley-Davidson tries to regain its coolness issue

Tiffany Camhi rolls as much as work on her bike.

Regardless of the eye-catching entrance Camhi makes every day, the Northern California resident prefers smaller bikes. Her 1983 Yamaha Virago XV500 is much less in-your-face than a Harley-Davidson.

“I may by no means see myself on a Harley,” mentioned Camhi. “They’re actually loud and tremendous costly.”

The 30-year-old Camhi is not alone.

Harley-Davidson bikes have been a mainstay within the business for the reason that firm was established in 1903 in Milwaukee. However the Hog maker has struggled of late.

Thursday’s earnings report marked the top of one other tough 12 months, with the corporate posting a 6.7 % decline in worldwide retail gross sales in 2017 in contrast with the 12 months earlier than. Bike shipments have been additionally at a six-year low.

Harley lowered its 2018 cargo expectations to a spread of 231,000 to 236,000 bikes after narrowly assembly its goal in 2017 at 241,498 automobiles. Whereas the corporate anticipates elevated worldwide retail progress this 12 months, retail gross sales within the U.S. are anticipated to be down, in accordance with Michael Pflughoeft, supervisor of company media relations for Harley-Davidson.

To attempt to flip issues round, the corporate has to encourage the following technology of bikers to switch those who’re ageing out. Millennials are proving to be a troublesome viewers: They need smaller, cheaper bikes — the antithesis of Harleys.

The problem appears to be a generational one. Child boomers fell in love with the outsized bikes because the image of romance on the open street. However youthful generations aren’t concerned about their dad and mom’ bikes.

“It is just like the Cadillac or the Mercedes,” mentioned David Beckel, an AllianceBernstein analyst who tracks Harley-Davidson. “You would possibly flip away from it should you’re youthful as a result of it is not your thought of cool.”

Lightweight, off-road, and electrical bikes have gained reputation amongst riders, in accordance with Jim Woodruff, chief working officer of Nationwide Powersport Auctions, a bike and powersport wholesale channel. So has the minimalist look.

“Ten to 15 years in the past, bikes with a whole lot of plastic have been cool,” Woodruff mentioned. “Now it is bikes that look extra bare.”

Final 12 months, in an try to offer riders what they need, Harley-Davidson launched eight new Softail bikes. The buyer response to the road has been overwhelmingly optimistic, mentioned Pflughoeft.

The smaller, extra modern bikes, launched simply in time for the corporate’s 115th birthday, have the identical highly effective engines as bigger Harleys. However a few of the bikes are as a lot as 35-pounds lighter than earlier fashions.

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