At least for now, a Harley-Davidson (HOG) about to enter another major turnaround is still one that makes some electric motorcycles.
Harley-Davidson’s new CEO Jochen Zeitz teased the fourth quarter release of a new five-year turnaround plan designed to more efficiently run a business being hammered by shifting consumer preferences (that emerged well before COVID-19). One component of that plan shared on Harley’s earnings release Tuesday is a 30% haircut to the number of models the company offers.
Not much was shared by Zeitz on the earnings call as to what models will be put on the chopping block. But we could rule out one high-profile model: The company’s first-ever electric bike dubbed the Livewire. “LiveWire will continue to be part of our product line up,” a Harley-Davidson spokesperson confirmed via email to Yahoo Finance.
The Livewire debuted in October 2019 after at least five years in development under former CEO Matthew Levatich. It was a key part of Harley’s plan to release 100 new “high impact” bikes by 2027 in an effort to attract new riders — several of the bikes were electric and smaller, targeting urban millennials.
Livewire boasted impressive specs out of the gate, including 105 horsepower, but also a hefty price tag of nearly $30,000 and limited range. Both of those negatives hampered early demand for the product. Consumers didn’t have much time to order the bike, however. Harley quickly halted production and delivery of the Livewire citing a an undisclosed build issue.
The bike has since returned to being available at roughly $30,000.
But clearly, Zeitz needs to jumpstart — or as he calls its, rewire — the iconic motorcycle maker.
Harley’s second quarter sales crashed 47% from a year ago to $865 million. The company’s adjusted loss came in at 35 cents compared to a profit of $1.46 last year.
“Complexity needed to be dramatically reduced gold set needed to be achievable and realistic our strategy had to be refocused to better align with our capacity and capabilities, and also our new reality focusing on what makes a difference and nothing else. We also needed to reignite the soul of Harley-Davidson and strengthen our culture,” Zeitz told analysts on the conference call.