Once an untouchable American icon, Harley-Davidson is in trouble. Between March of 2017 and February of 2018, Harley’s stock fell 23 percent. The first quarter of 2018 saw a factory closure and the loss of 800 jobs. Things clearly aren’t going well, but there is hope.
Even with declining sales, Harley has an army of brand faithful buyers and a tenacious 50 percent hold on the American motorcycle market. They also have big plans for turning the ship around, including work on electric motorcycles, which increase in popularity as the younger, environmentally-conscious generation reaches ridership age. Ridership programs teach new enthusiasts how to ride safely and generate income. They also increase used bike sales. Amid these positive changes, however, Harley just made a wise but controversial move. Official Harley-Davidson merchandise is now available on Amazon.
In 2017, Harley-Davidson branded merchandise like jackets and hats brought $262 million in revenue to the company. Merchandise appeals to the brand loyal who want to show their devotion and to those who can’t afford a motorcycle but can enjoy authentic gear. Harley-Davidson merchandise was previously sold only on the company website and through authorized Harley dealers. Offering their popular merchandise on Amazon, however, gives the brand a larger online presence. This is a smart move, given that 70 percent of consumers now shop online.
The company is predicting that Amazon sales, along with other parts of Harley’s new More Roads to Harley-Davidson program, will increase their operating profits by $50 million dollars by 2022. Not everyone in the Harley family is excited about this increase, however. Harley dealers point out that it won’t help them at all and it may even hurt.
Harley-Davidson dealers make most of their money on Harley tchotchkes. Dealer profit margins on motorcycles are around 15 to 20 percent and the markup on parts about 38 percent. Branded merchandise and gifts, however, allow for profit margins of 40 percent or more. By selling on Amazon, Harley-Davidson is putting itself in direct competition with its own dealers. Overall corporate profits may rise, but dealers won’t get a bigger piece of the pie. Dealers also fear losing more money in the future. They’re concerned that if selling merchandise on Amazon proves successful, the company may start selling parts there too.
Harley-Davidson claims that dealers have nothing to fear, assuring them that the company plans to somehow integrate them into the online experience. No one knows how though. Only time will tell if Harley-Davidson can turn things around and whether or not they’ll take their dealers along for the ride.
Harley-Davidson is known for its powerful, solidly built bikes that it sends roaring down the road. The company’s division of Custom Vehicles Operations is sending out three new models with plenty of exciting features. The following models are based on Harley-Davidson’s touring bikes, with advanced technology to entertain, maintain, and power, a near-obsessive attention to detail, and finally show-stopping finishes.
2019 CVO Limited
The rider who wants features, style, performance, and luxury, expecting it all, will find it all here. The CVO Limited is the creation of the ultimate in long-range luxury and comfort for touring bikes. It boasts new Tomahawk wheels, 19-inch in the front and 18-inch in the rear, a new blaze red band featured on the engine rocker boxes, and new paint options all-told. Its collection of Kahuna features is also new, from shifter pegs to heated grips.
2019 CVO Street Glide
This custom bagger with its hot-rod performance, edgy styling, and mind-blowing, ear-pleasing premium audio system also boasts the blaze red band and some new Kahuna Collection features. These latter include a red inset of the Bar and SHield on some components such as shifter pegs, muffler end caps, and passenger boards. It offers new paint options as well.
2019 CVO Road Glide
There is no mistake to be made when witnessing a Road Glide. Its style is distinctive and menacing with a contrasting combination of long-haul comfort in a motorcycle built for performance touring. With the same blaze red band that marks the engine rocker boxes of the previous two models, the Road Glide is distinct in its new Fang front spoiler that displays dramatic lower bodywork. The Exclusive Knockout wheels are 21-inch front and 18-inch back, the only front wheel of that size offered factory-installed on a Harley-Davidson Touring model.
Three distinctive styling treatments are geared to appeal to a wide range of customer tastes. There are the bright chrome details and powertrain, a combination of bright and dark finishes, and finally a very dark look with fade or monochrome paint. The company’s CVO models aren’t just to feature the new technology, which includes a monitoring system for tire pressure, high-performance engines, and the new infotainment system, but also to reveal in situ new finish treatments as alternatives to the more traditional chrome look.
One infrequently talked-about industry that has been gaining definitive traction in recent years is the electric motorcycle market. Although high-power electric motorcycles have failed to catch on thus far, there is a broad market in the United States for low-power urban electric scooters. In fact, more than 1.8 million were sold in the country in 2016. Even larger is the market for electric bicycles, which typically require the rider to input energy but that augment the user’s work through electric propulsion.
Harley-Davidson, the company that has made its name as the producer of roaring, powerful V-Twin motorcycles that have become icons of muscular American independence, is now seeking to branch out into the world of both electric motorcycles and electric bicycles. What’s clear is that the company already has the knowledge and some infrastructure to create top-quality electric two-wheeled vehicles; the company currently produces more than 1,000 high-power electric motorcycles each year.
What’s not clear is if a brand that has earned its stripes as a loud and brutish exemplar of raw American power can make a segue into a market that is more about being environmentally friendly and saving energy costs.
Following future dollars
But what Harley is doing, at the end of the day, is simply recognizing the reality of where the market is heading. Sales of electronic bicycles have exploded over the last decade, with millions of units per year being sold in the United States alone. But it is throughout the world where the real potential lies. As cheap means of transportation, electronic bikes have the potential to become the predominant form of personal transportation throughout the world, especially as electric motor and battery technology continues to improve, allowing both high speeds and extremely long ranges.
Harley is already gearing up its operations. The company plans on spending more than $200 million over the next ten years on research, development and manufacturing of electronic bikes and motorcycles. The company is developing products ranging all the way from flagship 200-horsepower electric superbikes all the way down to rider-assisted bicycles. The company believes that the trends towards lower-cost transportation options and the eventual inexorable rise in the prices of fossil fuels will eventually mean that these bikes could turn out to be the next automobile. The future will only tell if they are successful.
About Graham Zahoruiko
As Director of Organizational Effectiveness, Public Benefit Corporation, Graham Zahoruiko is leading greater corporate shareholder wealth, public benefit, and social responsibility. Graham gets to exercise a level of independence that is rare in the business world. He needs to rely on himself to deliver on what he has been hired to do. There are no shortcuts, only hard work, and self-reliance. These are qualities intrinsic to Graham Zahoruiko, so it is no wonder that they permeate through his personal life as well. Graham is a motorcycle enthusiast. His most peaceful moments are when he is astride his Harley-Davidson and on the open road. Again, independence is the key. The iconic images of the lone rider tearing across the pavement are certainly romantic, but there is an undeniable beauty to it as well. It is a part of American culture – the independent traveler forging across the country à la the pioneers during westward expansion. The public’s understanding of motorcycle culture is also influenced by popular films – Easy Rider, the Wild Ones, Mad Max. Biker gangs are often a popular trope in these films, echoed by real-world incidences. For instance, the Hell’s Angels at the Altamont Free Concert in 1969 and the violence that ensued.
Graham Zahoruiko was introduced to motorcycle riding as a child when his uncle would give him rides in the front yard. In those days, helmets were optional and Graham and his uncle found themselves on the ground from unsuccessful wheelies. These early experiences manifested themselves into a lifestyle on the bike. Riding has always been a thrill that Graham has enjoyed as it compliments his spontaneous personality. Graham Zahoruiko averages about 5,000 to 7,500 miles during the riding season — April through October — on his black 2013 Harley-Davidson Heritage Softtail Classic.
For Graham and motorcycle riders alike, the open ride provides an immense sense of freedom in the open air. Sometimes with no destination in mind, the motorcycle is the ultimate escape. The open road and the motorcycle community provides the opportunity to meet some of the kindest and most patriotic people. Whether it is a motorcycle rally, event or ride, you always have the chance to meet and learn from interesting people all over the country.
Motorcycle enthusiasts like Graham Zahoruiko have to fight against those negative connotations. To that end, Graham has been able to combine is the love of riding with another one of his passions – philanthropy. Graham regularly participates in fundraising events focusing on motorcycle riding. For example, the 9/11 Ride. The event is organized by America’s 911 Foundation, Inc., and is purposed to remember the heroes, volunteers and victims of September 11th, 2001. Preserving the memories of all those who answered the call on that horrible day is the charge of the ride, and for the best 13 years, they have been very successful. The Ride is an annual event where 100s of riders travel together en mass. For a thousand miles, the caravan rides in formation, visiting each of the three major 9/11 crash sites. The event has grown tremendously, where now major highway interstates are shut down entirely and thousands of spectators line the streets to cheer on the bikers and honor the fallen.