Weak Sales Spur Layoffs At Harley-Davidson

MILWAUKEE – After laying off some 200 production workers last October, Harley-Davidson plans to eliminate another 180 permanent positions this fall in the wake of weakening sales of its motorcycles, the “Journal Sentinel” newspaper reports. The company said Tuesday that U.S. sales in the second quarter of 2017 were down 9.3 percent from a year ago, when sales also declined.  Global sales were down 6.7 percent in the second quarter.

“It’s not looking good at this point. We did not see this coming,” Ross Winklbauer, a sub-district director of the United Steelworkers union, told the “Journal Sentinel.” Harley-Davidson plants in Menomonee Falls, WS and Kansas City are expected to be the hardest hit. The Menomonee Falls plant builds engines, while the Kansas City plant assembles bikes.

Second quarter sales of Harley-Davidson motorcycles in the U.S. dropped to 49,668 in 2017 from 54,786 in 2016. Sales for the first six months of the year dropped 7.9.percent to 82,984 units from 90,112. Harley-Davidson attributed the loss in sales to “weak industry conditions.” Globally, company sales were off 5.7 percent in the first six months.

Other income categories are also taking a hit. Parts and accessories were off eight percent for the first half of the year. General merchandise sales were off 18.8 percent.

In announcing Q2 results, company President and CEO Matt Levatich said, “Our long-term strategy, focused on building the next generation of Harley-Davidson riders, is our true north. Our new product investment is one pillar of our long-term strategy to build riders globally and we are energized by the strength of our model year 2018 motorcycles coming later this summer.”

Harley-Davidson’s market share for the second quarter was 48.5 percent. The company now says it expects to ship 241,000 to 246,000 motorcycles to dealers worldwide in 2017, an approximately six to eight percent decrease over 2016. The company previously said it expected shipments to be “flat to down modestly.” The company projects shipments in the third quarter will be down 10 to 20 percent.

(Photos courtesy of Harley-Davidson)

– By Bud Wilkinson