2018 Harley-Davidson Q2 Report: Finance and Outlook
Into the second year of its 10-year growth strategy that includes heavy restructuring across the globe, Harley-Davidson released its 2018 second-quarter financial report.
Compared to the second quarter of 2017, Harley reports that during 2018 Q2:
- International motorcycle sales were up 0.7 percent
- U.S. sales were down 6.4 percent
- Worldwide sales were down 3.6 percent
Though still in negative territory in regards to U.S. and worldwide sales, the numbers are much better than 2018 Q1 when the U.S. was down 12 percent, and worldwide down 7.2 percent.
“Our results in the second quarter reflect business performance that is in line with our expectations,” says Matt Levatich, President and CEO of Harley-Davidson.
“With the focus of every employee and dealer, we are making progress building the next generation of Harley-Davidson riders in line with our long-term objectives. Our manufacturing optimization, demand-driving investments and commitment to manage supply in line with demand remain on target and continue to strengthen our business.”
This restructuring plan began in spring 2017 when Harley-Davidson announced its 10-year objective to:
- Build 2 million new riders in USA
- Grow International Business by 50 percent
- Launch 100 new “high-impact motorcycles” like the Forty-Eight Special.
In its 2018 Q2 report, Harley added to these objectives, saying its “accelerated strategy” will deliver:
- New products: Keep current riders engaged and inspire a new generation of Harley-Davidson riders
- Broader access: Meet customers where they are and how they want to engage with a multi- channel retail experience
- Stronger dealers: Drive a performance framework to improve our dealer financial strength and the Harley-Davidson customer experience
The Motor Company says it believes that this accelerated strategy will drive revenue growth and expand operation margins.
“We will take bold actions that better leverage our vast capabilities and competitive firepower – excellence in product development, manufacturing, brand and our great dealer network,” Levatich says.
“We will motivate our existing loyal riders and inspire future riders who are not even thinking about two- wheeled freedom. We are tapping into the spirit that drove our founders back in 1903.
“Our plan will redefine existing boundaries of our brand – reaching more customers through new types of products and channels and doing so in a way that reinforces all we stand for as a brand and as a company. We’re out to secure the legacy of Harley-Davidson freedom for the next generations of riders.”
As per its building 2 million riders in the USA by 2027, Harley-Davidson says the company increased its reach and impact during the second quarter through a wide range of efforts including:
- Expanded Hooligan racing at the X Games and brought the first-ever flat track racing event to India
- Improved rate of Riding Academy participants who purchased Harley-Davidson motorcycles
- Drove 4.5 million visits to HD.com, a 29 percent increase
- Delivered 36.7 million social media impressions from #MotorcycleMonday; reached over 6 million Facebook viewers with #freedomstories and #harleyasia
- Garnered 9.8 million social media views of #FindYourFreedom interns content. From 7,500 applications, selected 8 young riders to explore U.S. motorcycle culture on their new Harley- Davidson motorcycles and inspire new riders along the way
- Increased access to Harley-Davidson by adding new international dealers and new apparel and lifestyle boutiques in popular shopping areas
Looking forward, Harley provided its 2018 full-year outlook, expecting motorcycle shipments to be approximately 231,000 to 236,000 motorcycles. In the third quarter, the company expects to ship approximately 45,500 to 50,500 motorcycles.