| Author | Message | ||
     Patches |
CHICAGO (Reuters) - Harley-Davidson Inc (HOG.N) and Polaris Industries Inc (PII.N) said on Thursday that cash- strapped consumers steered clear of their big, high-end motorcycles in the second quarter and warned demand would likely remain stalled for the rest of 2009. Both companies said they were responding to the marked deterioration by making additional cuts to bike production. Harley-Davidson, which has already laid of about 1,500 workers, said it would cut another 1,000 jobs and accelerate some previously announced plant closures. Harley's cuts were especially dramatic. The Milwaukee-based company said it would now ship between 212,000 and 228,000 of its namesake motorcycles to dealers and distributors worldwide in 2009, down 25 percent to 30 percent from 2008. Ed Aaron, an analyst at RBC Capital Markets, called Harley's latest production cuts "massive ... more than what either the buy- or sell-side was expecting" and wondered how Harley would be able to sustain its gross margins "given the inherent operating leverage in Harley's model." But Goldman Sachs analyst Patrick Archambault said the cuts would translate into "a significant reduction in dealer inventory which will ultimately better position the company for 2010" -- an interpretation that helped send Harley's shares higher. Not everyone was impressed. Standard & Poor's cut Harley to sell from hold, saying the results suggested "far worse selling conditions than expected" and that "economic pressures on consumer spending will depress results" through 2010. The production cut announcements came as Harley and Polaris reported second-quarter earnings. Harley's results disappointed analysts, pulled down by -- among other things -- $72.7 million credit loss provision at its captive finance arm. The numbers from Polaris, which makes Victory brand bikes, topped expectations, thanks to stronger sales of its side-by- side all-terrain vehicles But both companies said bikes sales were continuing to soften. Indeed, during the second quarter, industry-wide retail sales of the heavyweight motorcycles Harley and Polaris make tumbled 48 percent. "Motorcycle demand was much weaker than expected a few months ago," said Deutsche Bank analyst Rod Lache. The shares of Harley, which saw its market share grow last quarter, were up 8 percent at $18.88, while Polaris, which saw its already tiny market share fall during the period, were down about 5 percent at $31.89 in afternoon trading. (Reporting by James B. Kelleher; editing by Andre Grenon) | ||
| Shupe |
Interesting. Harley's sales down 25-30% from 08, vs industry wide heavyweight segment down 48%. Harley gained market share (but of a smaller market). | ||
| Conchop |
I hope Victory builds an adventure touring bike. | ||
| Devil_dog |
Other manufacturers have to be reading this forum and looking for ways to bring Buell owners to their brand. I was talking about HD killing Buell with a buddy of mine earlier today and we both think HD missed the boat with a great product. They really didn't let the company grow organically and didn't market it well. In fact the last time and only time he saw a Buell TV Commercial was during some Arlen Ness show on the speed channel. What was the point of that? In addition, he heard (unverified) that a local HD Dealer that also has a Honda Dealership was moving more Buells in the Honda Dealership. Why? In that context, it looked unique but relevant. Sitting next to a Road King, it looks like a fish out of water. I have to wonder, had HD not purchased MV Agusta, would they have been able to keep Buell going? I'd like to see Buell roll back to a smaller footprint, building fewer bikes, really focusing on what they do best. That sure doesn't look like it's in the cards now. | ||
| Goldrush |
I find it hard to believe that HD will not pick up the XB and 1125 lines and repackage them as a 2011 HD. The hard work and expense has already been paid. They could bring the XB out as a continuation of the XR line just call it XR Sport and the 1125 could be a stand alone Harley Corner Carver. They could run these two bikes on a very limited production, maybe get orders from dealers at the beginning of the building year and only produce that many bikes. Make them a Limited Edition Eric Buell Tribute bikes or something. They already have everything to run these bikes on their existing production lines at HD. This would allow HD to step into club racing and AMA racing with a winning product. They could put a small contingency out there for racers. This would just build on the positives that Buell established in the market. | ||
| Jasonnennig |
Ya Rite Goldrush, The day they rip down the Buell sign in East Troy and put up some lame HD sport or some-shit thing. Is the day I ram that sign up my ass- It will NEVER HAPPEN!!!LOL | ||
| Court |
>>>>They already have everything to run these bikes on their existing production lines at HD. They have none of that. It will not happen. | ||
| Qcbrob |
>>>>They already have everything to run these bikes on their existing production lines at HD. They have none of that. It will not happen. Court - What do you think will become of the XB motor? Coming to Buell by way of my affinity for HD sportsters, I was always intrigued with what Erik made out of the XL-based powerplant. I LOVE the XB motor and dearly hope to see it continue in SOME form in the future. | ||
| Hughlysses |
I find it hard to believe that HD will not pick up the XB and 1125 lines and repackage them as a 2011 HD. To back up Court's response, from the Q&A section regarding Buell's closure on their homepage: "Are any of the brand’s models going to be available as Harley-Davidson models? Harley-Davidson has no plans to produce Buell motorcycles as Harley-Davidson products." | ||
| Goldrush |
OK I knew I was going to take heat from my post. I have read the Q&A section, but I also can't believe with all the success Buell has had at the Club & AMA level racing that HD will just pass on the opportunity to jump in. I guess I am a dreamer, blame me for being one, but it makes since in my narrow mind. Sorry! I am very sick about the Buell shutdown. I don't think I will ever own another HD! | ||
| 46champ |
Rebadging Buells as Harleys would get them nothing. That would just perpetrate the biggest problem we had most of the dealers didn't know how to sell or service a sport bike. By having the Buell line die all the prior contracts die also. When they start building again we pickup the existing dealer service base of dealers that hang with us and add to it as needed. | ||
| Goldrush |
I got news from the top that HD is shutting Buell down because of the patents on parts that HD is not willing to let go. In other words the only company that can make these Buell lines is HD or a company owned by HD. Maybe there is another way through this, but HD is not willing to sell Buell like MV Agusta. Is there something I am missing? | ||
| Goldrush |
I agree part of the problem with Buell selling in the cruiser showroom was the dealers did not know how to market these sportbikes to a non sportbike customer. that being said I think alot has changed in the last few years. First some dealers learned how to market, some dropped the line. Second the Buell sport bike has started to gain traction in the market. HD enthusiast are warming to the Buells as well as nonHD riders are taking notice of the Buells. Finally, if the HD brand were slapped on the XB and 1125 HD loyalist would buy them. Look at the heavy low performing Vrod. Sorry HD but there are alot better bikes out there for alot less money. | ||
| Rhun |
According to DMG they are working on getting a Sportser class going within there venue to get Harley spectators. Good for Harley bad for Buell. I'm guessing that the 1125 was recognized as a Harley by the Harley crowd. | ||
| Goldrush |
I think it is great that DMG is looking at a sportster class, but com on no-one will ever consider a sportster a performance bike. LOL Maybe in the 1950s or even in the 80s when Tilly HD raced Lucifer's Hammer, but thats it Heavy cluncky cruiser. | ||
| Buell2001b |
if HD comes with a bike to replace the buells, I can see a lawsuit from Buell owners!!!! | ||
| Mog |
NEWS FLUSH  The new Model 35 and Model 60 will use the XB12R engine in their 2010 Mahindra Tractor line-up.  The 1125R engine will be used as a ground assist start engine for the venerable Russian SUK 1 4 HD helicopter, which, by the way, runs quite well on H-D corporate flatulence.  | ||
| Cajunrph |
Yo HD  | ||
| Frito |
How do you figure? The MoCo already owns/controls everything in Troy (they just proved that by pulling the plug), running production somewhere else is just logistics. No doubt every process is documented, drawings & specs for every part are cataloged so with a little training, tooling, and the information available to the MoCo any assembly line could duplicate the work. I call BS. | ||
| Goldrush |
I visited the Buell factory last year. The production lines are interchangable for all models. Now I assume HD is similar. Therefore running an xb or sportster on the same line would be pretty simple. They just restock the sub assemblies and reset/retool the process, but that is what they do for any model. | ||
| Toecutter |
My wife worked on the assembly line at Powertrain Operations in Menomonee Falls. She has since been laid off. They did not build the Sportster or Thunderstorm engines at Menomonee Falls. These engines were built at the Capitol Drive plant. Now the plan is to consolidate this production under one roof at the Menomonee Falls plant, and close the Capitol Drive operation. This could have been a relatively swift process, but the union negotiations have slowed the whole process to a crawl. It is happening, and the process will eventually be completed, but I don't think that it is going as smoothly as the motor company would like. So now, with the amputation of Buell, I guess they will only be moving the manufacture of the Sportster engines to the Menomonee Falls plant. To address Goldrush's statement, In my opinion, the only way for H-D to build a Buell-like motorcycle would be at the current Buell facilities, unless they want to put money into re-tooling the H-D production lines, and it seems clear to me that investing for the future is not something that H-D is interested in. The only thing that they seem capable of doing right now is to try and stop hemorrhaging money. | ||
| Goldrush |
Thanks for the insight. I am sorry to hear about your wife's employment. I know this year has been really hard on a lot of people. | ||
| Court |
>>>I call BS. as is your right . . . |
