Last year I created a video, questioning Harley-Davidson’s general leadership and vision, and whether I believed that there was a future that didn’t end with the demise of the Motor Company. I argued that H-D waited too long to reach out to a wider base, that their motorcycles are too expensive, that their efforts to update their bikes was a disappointment to their base, and finally that despite their efforts, their tech upgrades were a step (or more) behind the competition.
So what’s happened since the summer of 2019. Harley has seen their CEO resign, and new blood appointed to try and steady the ship. But, with a pandemic (and a whole collection of other things) wreaking havoc on the US economy, if anything is certain, it is uncertainty.
Before we go full steam ahead, I want to explain that I am a big fan of Harley-Davidson. They have consistently brought a bold and unique culture to the community of riding, and though the history of Harley is not without blemish, it is undoubtedly intertwined with the history of American motorcycles. It needs to be said, that I am not an economist, or a salesman. In fact, if you want some expert analysis, and haven't already, I would highly recommend watching Fort Nine’s video regarding Harley’s present predicaments. I am just a guy who loves motorcycles, and has an opinion.
So, last year’s video was viewed over 85,000 times and has garnered over 800 comments! The one thing I can say for sure from all of that feedback is that people are passionate about H-D, on both sides of the coin. I explained the reasons why I thought Harley found themselves deep in a hole that seems there is no climbing out of. But, this time I wanted to play armchair CEO, and provide four suggestions on how I think they can keep the ship from sinking, and set sail towards calmer waters.
1 - Reduce Prices - there’s a time when you’ve got to lose money to make money. With a dying breed of core customers; smarter, more frugal potential buyers aren’t going for old tech, and certainly not when they can get something comparable at a lower price point. By cutting the prices across the board (I’m talking bikes, parts, service, merch, etc) they can show that they’re willing to lose money (if necessary), to gain a broader and more diverse base of riders to usher them into the future. If Harley-Davidson wants to be around for a hundred more years, it may mean that the big dogs at the top need to take salary cuts, begin to cut profit margins, and simply find a way to lower prices. They are definitely in the right hands to do that with the new CEO Jochen Zeitz. Just appointed in May, the new “CEO has already lined up plans to cut costs and “de-emphasize” some of its unprofitable international regions” (this according to rueters.com) It’s too early to see whether this cost cutting will translate to lower prices for customers, but we can all hope. Earlier this year, the MSRP of the newish FXDR 114 dropped from $22K to $19 grand. It’s hardly a sign of the times, but it is sign that a significant price drop is not out of the realm of possibility.
2 - Invest in your people - In my opinion, it’s long overdue that the MoCo overhaul it’s approach to sales and the people who execute at the ground level. This is by no means an easy or simple problem to solve. Undertraining, overvaluing competition within, and obsessing over numbers that are driven by a dollar-over-all approach affect the experience that customers have when visiting a dealer. At the very least, H-D needs to invest in the people who are the face of their company, and the first point of contact for new and existing customers. A lack of comprehensive and universal training is at the core of my qualms when visiting a dealer. The fact that I can get a different answer regarding service and parts from one dealer to the next, or that I’ve entered a dealer knowing more about a new line than some salespersons is disheartening. Teach ALL of your sales, service and parts staff not to condescend to customers who don’t fit the build. I can say from experience that I am not treated the same by any two employees, and that sentiment was echoed a hundred times in the feedback of my last video. The process of buying a machine that carries a premium price tag should reflect an experience of the same quality.
3 - Stop treating new technology as a gimmick - I don’t know about you but I have been inundated with ads for the all-electric LiveWire. Don’t get me wrong, I’ve ridden the LiveWire and have nothing but praise for the bike’s performance and quality. But the H-D LiveWire ads feel like pandering. They talk about how the bike sounds, and how exhilarating it is to ride one. I get it, it’s a sales tactic, but as someone who feels like the core customer base for an electric bike, I don’t care about the sound. Also, I’m a rider and for me, riding is already exhilarating. So, tell me about the tech. For those less informed, teach them. Tell me about the impact electric bikes are going to have environmentally. And, stop treating technology like it’s a new-fangled gizmo, and tell me about how new features are going to affect me as a rider. Frankly, a lot of the tech that H-D has introduced in the last year and a half is old news and many of these “upgrades” will come standard on bikes that are similarly or even priced lower by different bike companies. So, make these “upgrades” standard and see them as stepping stones to a better build and not an excuse to gouge me.
And that is a great segue to my final point, which is to say if you’re going to charge me more, then you need to -
4 - GO ALL IN - it’s time to leave the past behind. There’s a difference between paying homage, and not being willing to let go of old tech. Examples from the world of the cage are the 2021 Ford Bronco and the 2020 Chevrolet Corvette. I’ve got a close eye on how the hype surrounding these reboots translates into sales, but if the hype is real, Harley should take note from these other American companies. These vehicles pay tribute to a vintage time, but it’s easy to see that the goal is to build a machine that feels like “the good ol’ days” in image, but not in technology and engineering. If you’re leading the pack in innovation, it could at least begin to justify the price tag.
There is some hope on the innovation front, as the new CEO has a phase one (Rewire) and two (Hardwire) plan in the works. CEO Zeitz says "We are streamlining our motorcycle models by approximately 30 percent with plans to further refine our product portfolio. This enables us to invest in the products and platforms that matter the most while better balancing our investment in new, high-potential segments. In this context, we plan to expand our offering of iconic motorcycles, those which most embody the spirit of Harley-Davidson." (Revzilla) This can be interpreted in a few ways, but I hope this includes a full revamp of H-D’s approach to their traditional motorcycles. If not, I think they will continue to fall behind their competitor's offerings, and inevitably into obscurity.
The Harley ship has seemed rudderless and without a clearly defined vision for the better part of a decade. But, the optimist in me hopes that with the change in leadership, and a push to continue to find ways to relate to a larger base, we will see the company remain relevant. I want the future of motorcycles to include a Harley-Davidson that is still a household name and isn’t reduced to a boutique brand for the wealthy. But, I’m just that one guy, with a YouTube channel and a platform to voice my opinion. What’s yours?