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Posts Tagged ‘CDC’

Q1’20 Harley-Davidson Retail Motorcycle Sales + Motorcycles and Related Products Segment Results

Let’s jump right to that impressive Q1’20 financial result:

  • Harley-Davidson (NYSE:HOG) posted earnings of $69.7 million compared with $127.9 million in the same period a year ago.
  • The dividend was slashed to 2 cents a share from 38 cents.
  • The motor company is in talks with major U.S. banks to secure $1.3 billion in liquidity.
  • Harley’s U.S. retail sales were down 15.5% compared with the same period a year ago.
  • International retail sales were down 20.7% compared with 2019.
  • Harley’s U.S. heavyweight motorcycle market segment share was down 2.2 percentage points, to 48.9%.

Another quarter, another poor performance from Harley-Davidson, though the market seemed to buy into the promise that this time it will be able to turn things around.

Déjà vu…

Management promising to fix things again by “crafting strategy accelerants” to deliver improved sales and better returns.  However, it admitted that its efforts thus far haven’t worked and also said it was “refining” the plans it had already devised, but it wouldn’t reveal how it was going to achieve them until this summer. Granted the financial problems Harley-Davidson encountered this quarter aren’t necessarily all of its own making, though it hasn’t helped itself along the way.

It’s important to note that the Harley-Davidson trends in the U.S. have been weak for years despite the economy being strong for so long. That is a major problem and the acting Harley-Davidson CEO, Jochen Zeitz, remains vague on what the motorcycle company is going to do to change that dynamic.

The “ReWire” Board

The fact that management chose the term “ReWire”, emphasizing the electric future to describe their refining plans reads like a satirical article in The Onion.  It’s as if CEO, Jochen Zeitz said, “I’ve heard some concerns going around, and I want to impress upon each and every one of you that I’m taking every possible step to ensure that we tap into a market that has traditionally been neglected by motorcycle manufacturers, Harley-Davidson is announcing a new line of motorcycles designed specifically for men.”

The “ReWire” plan consists of five main points:

  • Enhance core strengths and better balance expansion into new spaces.
  • Prioritize markets that matter.
  • Reset product launches and product line-up for simplicity and maximum impact.
  • Build the Parts & Accessories and General Merchandise businesses to their full potential.
  • Adjust and align the organisational structure, cost structure and operating model to reduce complexity and drive efficiency, to set Harley-Davidson up for stability and success.

The ReWire playbook abandons some of the previously ratified “More Roads” plan, but there is so much “CEO Speak” — “designed to address top priority opportunities, drive consistent execution and reset the company’s operating model in order to reduce complexity, sharpen focus and increase the speed of decision making.” — in that investor call its difficult to know what exactly remains “committed” to or what will stop.

Little is certain these days, but there’s one sure thing: in a situation where 30+ million people were laid off or furloughed in the past 6-weeks, people are definitely thinking about their wallets.  And living with ever-present, crushing uncertainty and the knowledge that people all around us are dying isn’t the stimulus to rush out and purchase a new motorcycle.

Let us face facts.  It’s going to be a different world for a while. After all, temperature checks, touch-less payments, masks, wipes, take-out and distancing were not part of the Harley experience before the March closures.

If Harley-Davidson is about anything, it’s about bringing people together. Lots of them. And really, really close — with motorcycle rallies, music festivals, HOG events and all the cross country rides.  Looking at you Sturgis!

The whirlwind of 400,000+ motorcycle enthusiasts half-hearted adherence to CDC guidelines, while gathering all week in a number of local bars, and eating VEGAN-burgers could be viewed as a controlled experiment to determine the virus’s true incubation rate.

I have some gray in my hair and beard, something you will see in a majority of Harley enthusiasts.  I find the idea of a Harley specifically aimed at men deeply patronizing.

Photos courtesy of Harley-Davidson.

All Rights Reserved (C) Northwest Harley Blog

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Swine Flu Face Mask

Swine Flu Face Mask

Unless you’ve been hiding under a rock, you have been bombarded with news coverage of the swine flu (H1N1) for several days now.  I first heard about the outbreaks in the airport when catching a Southwest Airlines flight. 

Whether you’re getting ready for a motorcycle ride, a Megadeath concert or just looking to personalize a face mask — during this pandemic people are injecting some fun into the panic and using them as a fashion statement.

Pity the poor HOG…the CDC has officially stopped calling the virus “swine flu,” opting instead for the more hog-friendly H1N1 flu.  The swine influenza is a respiratory disease of pigs caused by type A influenza viruses and has a major economic impact on the swine industry in the United States. Flu outbreaks in pigs are common, especially during winter months.  Somehow it got to Mexico and then mixed with humans. The World Health Organization (WHO) raised its pandemic alert to level 5, which is the 2nd highest level of alert that indicates a swine flu pandemic is imminent.  Level 5 exceeds the level achieved by both the Avian and SARS outbreaks of past years.

In the 1976 Swine Flu outbreak federal officials pushed for widespread vaccinations after swine flu broke out among soldiers at Fort Dix, NJ., killing one of the 14 diagnosed with the illness.  The program was suspended after at least 25 people died from the vaccine reactions. Another 500 or more later suffered from Guillain-Barre syndrome, which damages nerves and can lead to paralysis.  43M people received the flu shots with the help of TV ads.  Dr. David Sencer (Dir. of CDC) was fired over the deaths although at the time health officials were very concerned with a pandemic on the scale of the 1918 flu outbreak that killed an estimated 21M people.

I’m not trying to do a “Joe” (Biden says: “stay off airplanes and subways”) and cause undo alarm.  In fact, I think this has been overblown by the media.  Sort of a crisis of the week.  As of this writing 11 countries have reported 257 cases.  The U.S. has reported 109 cases including one death.  Mexico, where it originated, reported 97 cases and 7 deaths.  It’s been reported that over 30K people die each year during a typical flu season so this outbreak has a way to go to match that level.

Be safe out there!

More information links:

  1. Ministry of Health (Mexico)
  2. World Health Organization (Swineflu)
  3. CDC (Swineflu Key Facts; Brochure)
  4. Pandemic Flu Info

Photo courtesy Getty Images.

All Rights Reserved © Northwest Harley Blog

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