How Harley-Davidson Killed Itself | Victory Motorcycles: Motorcycle Forums

How Harley-Davidson Killed Itself

Discussion in 'Victory General Discussion' started by Blackened, May 22, 2020.

  1. Blackened

    Blackened Well-Known Member

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    Thought this was interesting...



    I like FortNine. I don't always agree with his viewpoints, but for the most part his vids are pretty entertaining.
     
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  2. CrazyDiavelRider

    CrazyDiavelRider Member

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    Until it’s it’s dead, it’s not. How long have you been hearing this. And I am far from being a HD guy.
     
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  3. Blackened

    Blackened Well-Known Member

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    Just thought it was an interesting take on harleys problems. I'm not a financial guy and didn't realize the intricacies of how they were inflating their numbers.

    It's not really a lets bash harley thread, just something I thought was interesting.
     
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  4. slickvic

    slickvic Well-Known Member

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    I read new CEO is slowing production. Harleys will be scarce and you will pay dearly for one. Like it was in the 90’s. If this is the case then the big boutiques will certainly suffer to pay the bills. Then again HD service should stay plenty busy. I’m thinking non essentials like powersports and boating will suffer as we start to fade out. The next generation coming up can’t even afford a home. The last thing to buy is toys. They will buy ours. The pre owned market may soar and the new fancy expensive stuff will be for the better off financially. HD treats their product like they’re the Mercedes of motorcycles anyway so they can go that route if they want. Indian too. I’m done with buying new bikes. Very happy with my choice.
     
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  5. 1stVictory

    1stVictory Well-Known Member

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  6. slickvic

    slickvic Well-Known Member

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    Simply we all have bikes now. We all meaning our generation. A generation of baby boomers. Rockers. Bikers. Once hippies and stoners. Hotrodders and gear heads. Some still hippies and stoners. Us with limited income and uncertainty of the future of this country. Scary sh!t for Harley Davidson.
    What happened to all the bike builders. The customizers. Big dogs and Exile bikes. Where are they today. Where have they been the last 15 yrs.
    like us ...... getting old and complacent. Listen to us. All of us. We all saying the same sh!t. I’m happy with mine. Till the wheels fall off. Same for the HD guys that own their bikes. Atleast the ones I ride with. Sure we all go and eat free hot dogs and drink free beer at the Saturday VIP days. Look at the new pretty bikes and go oooooh and aaaaah. Last couple years nothing’s changed enough to want an upgrade. Factory stereos suck. Factory power sucks. We tend to make our bikes the ones we own way better than stock so what is there at $25k plus that gonna fetch a rider that already has a great bike.
     
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  7. 1stVictory

    1stVictory Well-Known Member

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    Probably still making custom bikes for NFL and NBA players, as long as their personal player contracts allow them to ride on 2 wheels. A good friend I worked with bought a H-D Fatboy years ago, basically new, for peanuts, from an Edmonton Oilers player. When the coach found out he bought a bike, he told him, "Get rid of it!" The downturn of the economy in 2008 never really got any better and this pandemic has really nailed those mega-thousand dollar bar hoppers. The only thing they are good for is just looking at them admiring the paint schemes from really talented airbrush artists. Don't want to get caught in the rain some day or get them dusty. They're useless items for people who have too much money and can't spend it fast enough.
     
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  8. 1stVictory

    1stVictory Well-Known Member

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    Screen Shot 2020-05-22 at 3.59.34 PM.png
     
  9. bikendad

    bikendad Well-Known Member

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    If Harleys become scarce that will play into the hands of brands like Indian looking to increase market share. If you can't get a Road Glide and you go ride a Challenger.....
    Yes mcycle sales are down and most likely will continue to drop. A company like Indian can prosper however by simply converting a few sales from HD. HD however can't survive loosing sales and market share. Raising prices won't help them as there's just no more room for that in the current market and economy IMHO. Pricing for these "premium" bikes is absurd now when comparing what you get in the sutomitive sector for similar pricing.
     
    Last edited: May 22, 2020
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  10. Kurbs

    Kurbs theVOG.net Gold Supporter Gold Supporter

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    Harley was simply too arrogant for too long. They honestly didn't give a rats @ss about the customers or quality and charge a lot of cash for those bikes. When Vic came out they had some competition, and IF Polaris had KEPT Vic along with Injuns my guess is HD would be close to gone as they could be right now.

    However they did learn something. You can grab a softail or other steel frame for around 15K which was close to what Vics were selling for. The way they did that was source a vast majority of parts from Asia.

    The Buehl was actually a well handling sport bike and they never managed to push it. The electric bikes are a joke. The India made street bikes are a joke. Too little too late.

    Now they are kissing up trying to get back a large customer base they lost. I don't think it'll work unless the economy blows sky high and the middle class has more disposable income. Same with Indian. They better figure out how to make an in-betweener from the Scout to the baggers.

    I like the looks of some of the Indians but not paying 25-30K for 1. And I highly doubt the upcoming Millennials will either. If they can't ride it on X-Box, they aren't riding. Plus so many still live in their parents house and are forbidden to own 'dangerous' vehicle, but are also finding the 50K they spent on a Liberal Arts degree or a Psyche degree isn't worth the 3 bucks its printed on as far as a good paycheck goes.

    Eve if they inherit cash, they run out and buy Hybrids and scooters if they ride 2 wheels at all. Or Crotch Rockets they can grab new for 5K.

    Take lots of pics now fellas...cuz in 10 years we will bee seen on museum walls and Historical Society exhibits.

    Like the Great Plains Horsemen....I think we are beginning to see the end of an era in America. But damn I'm glad I was able to live it most of my life!
     
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  11. Kurbs

    Kurbs theVOG.net Gold Supporter Gold Supporter

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    They may treat their product like a Benz, but they treat their customers like a Yugo. I remember when they pulled that in 1992. I was about to spring for a new Fat Boy at a dealer. 9500 bucks. While I was waiting on my next paycheck to hit, the damn thing went to 12.5, then 16.5 and then you had a 6-12 month wait for a new order! Guys were buying them up and selling them for thousands over what they paid because the panic set in.

    HD smiled back then, but it actually hurt them. Asian and Euro sales began to bust loose and took the market eventually due to cost and reliability in comparison.
     
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  12. iabob

    iabob Well-Known Member

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    It was a well done video, much easier to watch than some of the amateur crap out there pretending to do a review on a bike. A few thoughts come to mind. The first is a well produced video can present whatever argument it’s producer wants to perpetuate. If I had the tools, and I wanted to make a video about how a new era of glory days is just around the corner for Harley...I could make that video. Or if I wanted to show how they are days away from death...I could do that too. So as was mentioned, nothing’s dead until it’s dead.

    Second thought, and I’m glad the video noted it, motorcycling is not dying. Brands that make a variety of bikes and sell to more than a small slice of the market, they’re all up. It’s only Harley, and Harley’s imitator that are down. But circling the drain means two very different things for these two brands. Let’s start with Harley. This isn’t a small family run business that doesn’t have enough money to pay the rent so the landlord changes the lock on the shop door and it’s over. Harley won’t die like that. They may very well, and very soon, find themselves without enough cash flow to make debt payments. At which point they need a bailout. Could be in the form of a gift courtesy of the US taxpayers, lotsa that going on lately. Could be in the form of a foreign bank or government loaning them money when no other US source will, we got a president that knows all about that. Could and most likely comes in the form of a bankruptcy filing. There are multiple different bankruptcies, chapter 7, 11, 13, etc. under reorganization a court approves Harley’s plan to stay in business, forcing debtors to accept not being paid the full amount they’re owed. But even a chapter 7 liquidation, Harley as we know it dies one day and the next day a new owner who bought it’s assets from the banckruptcy court reopens the doors. Changes will happen, but they already have many times in that comapny’s history.

    Contrast this with Indian. By just being a division of Polaris this changes things drastically. A money losing division of a bigger, profitable company does not go through any of the bankruptcy chapters. The only options here are Polaris continues to invest money that does not generate profits when they could invest the same dollars elsewhere and make profits, or they shut it down just like they did Victory. In theory Polaris could sell the rights anytime they want. Obviously Victory is not for sale because Indian is using a lot of its patents and IP, and a new owner of Victory would become a competitor. If Polaris decides to quit Indian too, I see no reason why both brands wouldn’t go up for sale, but honestly who would buy them? Not someone who wants to repeat a failed experiment so I’m doubtful a new owner would try what has failed so many times before. Certainly not a new owner with deep enough pockets to bring a product to market that has a chance to succeed. My bet here would be the new owner of the brand(s) would be a licensing company that earns royalties on t-shirts and sells rights to other companies to make parts.
     
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  13. slickvic

    slickvic Well-Known Member

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    Very well put Bob.
    If you take something away for a while two things can happen.
    When it returns ......... everybody wants it now more than ever........ or everybody realizes they did without it just fine.

    If this new CEO makes the bikes more scarce and reduces model choices How will this help?
    dealers have put their heart and soul on the line to have these dealerships and some are huge. I don’t see any Winn here. I see a market that is tougher than ever to get buyers in the door. They outgrew themselves imo.
    They need to be creative now and sell upgrades and performance at a reasonable price. Accessories still fly off the shelves or do they. Indian killed their accessories by giving you a bike well appointed. Lotsa chrome and good performance. If Polarass is smart they will seize this opportunity and build what people want and can afford. Like Victory did.
     
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  14. iabob

    iabob Well-Known Member

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    2021 will be an interesting year if nothing else. As of last week over 38 million Americans filed for unemployment and 47% of households have seen their incomes drop. Even if the economy rebounds quickly, it won’t be quick enough. Hopefully it does rebound quickly and 2021 looks more like 2019, which was a terrible year for Harley and Indian. If we are lucky enough to get back up and running at 2019 levels by mid 2021 I’m thinking we were already on a path to see a lot of HD dealers go belly up. Contrary to popular opinion t-shirt sales are not what kept the doors open at those huge dealerships. Those dealerships need to sell bikes in quantities like they were when Harley was selling 275-300k bikes a year. If the new normal is 175-200k bike’s a year, a lot of those dealers will have to downsize. And if it takes a year or more for the economy to fully rebound...Harley dealerships in 2025 could look like they did in 1975 or 1985. I don’t think 47% of the country that has been, is still going through rough times is going to be in the mood to buy a new Harley or Indian their first few months back on the job. I’ve been fortunate so far, but trying to guess a timeline, if I was unemployed and behind on debt right now....let’s say a guy gets called back to work June 1st. How many months will it take to get caught up on bills? Then how many more to build a little bit of savings? Then how many more to re-establish some credit? In a consumer based economy it could be a couple years easy before half the consumers in the market are participating in things like expensive new motorcycles.

    I’ve been wrong about a lot of things before and could be here about this. Maybe things will snap back so fast my head will spin and that 47% will be in the market for a new Harley when the new models come out in July or August. But I think it’s more likely this fubar of a response to a pandemic is going to cause pain measured in years and not months.

    Side note I just changed my oil! Old Spectro out, new Amsoil 20-40 in :))) Honestly though I’m not sure I’ll notice any dif.
     
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  15. primethious

    primethious Well-Known Member

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    I find it crazy that the CEO said that it was "a long march".. where the Red army lost over 93% of their men. Wow.
    The thing that will destroy Harley or any business during a downturn or market shift is Debt. As long as they don't go into too much debt they should survive.
    No debt would be ideal.
     

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