| Author | Message | ||
     Prof_stack |
Today I went to the local HD/Buell dealership to pick up a new hand-brake lever (which they actually had in stock, and still made in the USA!) and the place was awash in motorcycles! I've never seen so many hogs together outside of Sturgis! Besides that, there were TWO 1125R models on the showroom, and yes, test rides are okay. '07 Buells were priced to sell. Did HD post a loss in the 4th quarter? That would be the first time in almost 20 years, I think. Anyway, since I haven't been to the shop since September, things sure looked somehow different. But the staff sure was friendly! | ||
| Ft_bstrd |
Nah. It's just winter. The "good ole days" came with waiting lists, deposits, and premiums above MSRP. And the bottom line wasn't nearly as healthy. | ||
| Corporatemonkey |
HD has been in trouble for a while. There are stuck producing too many bikes, and not enough demand. Not to mention their core audience is gaining in years, and not being replaced by a younger generation. Owning a Harley for the younger generation is not the status it is to the baby boomers. Most of us are too young to have any connection to "easy rider." | ||
| Court |
>>>HD has been in trouble for a while. Well during the time that have "been in trouble" they have posted financial results that are unprecedented in the history of American business. . . . I agree that Harley-Davidson has some real challenges. I disagree (it's simply personal opinion as an investor, not as a motorcyclist. Harley Davidson stock hit a 52 week interday low on January 11 at $39.7100. I'm watching it closely and disagree with the "in trouble for a while" . . depending, of course, on what "a while" means. I bought mine in 1983 (the year of the XR-1000) when the company I was working for went out of business and paid out all the profit sharing to employees. To give you a sense of what has happened since then yoiu can look at the HD vs. Standard and Poors chart HERE by clicking H-D vs. S&P 500 under Stock. As you can see each $100.00 investment is now worth $23,161.00. I was a young kid, fresh out of college and only had $6311.00 to invest. But, you can see why I'd argue against "in trouble for a while". I think they have some HUGE challenges now but I also think folks are too quick to jump on the "oh boy are they going to get what they deserve now" bandwagon. There are some very smart people there and over the years they've learned a thing of two. One of the problem will be getting a few of the stupid people out of the way who have been promoted over the years as a method of getting them out of other areas. I, for one, look forward to the future. By the way . . . if you are looking for a motorcycle stock to buy . . . I'd point you toward Triumph (TGI). Court From an older press release from 2005:
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| Corporatemonkey |
Maybe I should have clarified. As someone who brought HOG in the late nineties, and sold out mid 2006 I think HOG has turned for the worse since then. 6+ quarters in corporate earnings is a lifetime... I would agree that Harley is really an american success story, but you cannot deny that things are not looking so rosy lately. | ||
| Danger_dave |
Taking Orders for late 2008/2009 if you want a Rocker down here. Same for a Night Rod. | ||
| Court |
>>>6+ quarters in corporate earnings is a lifetime... That it is and they went for something like . . . 67 consecutive quarters of GROWTH. . . . (someone can look that up and correct it) There are several motorcycle companies that are going to have to "find" themselves. As you know Ducati had a big stink with their union last year when they laid off 100 workers to reduce production when dealers refused to accept further shipments. They just had a big conference call explaining their new strategy to investors. Part of HD's problem frankly is gum on their corporate shoe. Their customer base hasn't disappeared but it has moved. | ||
| Danger_dave |
Because there are now viable metric alternatives? - interesting angle on globalisation. | ||
| Rocketman |
As you know Ducati had a big stink with their union last year when they laid off 100 workers to reduce production when dealers refused to accept further shipments. when dealers refused to accept further shipments of soon to be replaced models, would be more accurate. Rocket | ||
| Rich |
Metric alternatives? I haven't seen anything that would make me switch. I've ridden most of them, and they don't measure up, at least not for me. | ||
| Danger_dave |
Nothin wrong with a M109 and it's a fraction of the price. Whatever our brand opinions here - it's a viable alternative in the greater marketplace. | ||
| Rich |
True, I just haven't seen or ridden any that would make me ride something other than the "real thing". I'm ruling nothing out, though. | ||
| Dobr24 |
I would like to ride Triumphs new touring bike! | ||
| Thumper74 |
Dobr, are you referring to the Sprint ST or the Rocket III? Both are VERY sweet bikes. My roomate has an ST and it's a beast. If I ever need a bike for two up riding I'd be torn between an ST and a Uly. For the money, the ST is a very sweet deal. His dad has a Rocket III and you can't beat the 'get up and go' that a 2300 cc motorcycle offers... | ||
| Jackbequick |
The bike load on the showroom floors can vary a lot from one region to another and seasonably. Up here in the northeast this is the time when very few if any are riding. Many who are planning new purchases have their on rides up for sale on consignment, that loads up the used models display areas. Then the new season's models are starting to show up. A lot of them will arrive already sold but if you're looking to buy you have to be there quickly when the new "sales stock" models hit the floor to get first choice. Even then there is some "politics" with the sales people and their friends, lovers, and the "chosen few". I swear it sometimes looks like you have a better chance of getting what you want (and maybe even a better deal?) if you are in a "uniform" that identifies you as one of "them" and that complements the moco image. Buying cages is a lot less complicated. But it is about time for another visit to Central Maine H-D just to kick tires a little. Maybe see an 1125R even. Jack | ||
| Ryker77 |
Dollar is down Gold is up Credit card debit is up Housing foreclosers is up personal savings is down Luxury toys are not in most peoples budget or credit line. | ||
| Court |
Dollar is down Gold is up Credit card debit is up Housing foreclosers is up personal savings is down Wall Street Bonuses hit a record $38,000,000,000 averaging over $600,000 per employee in the industry. Based on the Masseratis and Carerra 4Ss floating around . . . there is at least one group that "didn't get the memo". | ||
| Wolfridgerider |
Wall Street Bonuses hit a record $38,000,000,000 averaging over $600,000 per employee in the industry Could this be one reason my 401K is not growing as fast as it should? | ||
| Lost_in_ohio |
Yep 403b is down as is my kids college saving plan lost money last quarter. Hopefully it goes back up....of course I have 12 years before he needs it. | ||
| Ducxl |
Based on the Masseratis and Carerra 4Ss floating around . . . there is at least one group that "didn't get the memo". Let's see a histogram of those people compared to the rest of our society. A miniscule number me thinks. | ||
| Rex |
The showrooms are definitely full. We are in the middle of winter. Lots of high dollar machines sitting on the floors. Some of the new models are waiting for delivery. Lots of Buells sitting in the Chandler HD Buell store. One new 1125 R is there, but is not selling. Too bad. The economy is scary. You don't think of buying a HD for saving fuel money. 18,000- 25,000 plus is a lot hard earned money. | ||
| Court |
>>>A miniscule number me thinks. I agree. One guy taking a $58,000,000 bonus screws it up for the rest of them. Wall Street had, at least for folks working there, one of the best years ever. | ||
| Ducxl |
I wasn't being a wiseguy.I just think,for the people who'd mostly be buying Harley-Davidsons,have precious few dollars to spend on motorcycles. Of course,i may be wrong and we may NOT see the expected recession | ||
| Buellinachinashop |
"HD has been in trouble for a while. There are stuck producing too many bikes, and not enough demand." Nope. HD sold more bikes this past season than that of the 100th. They had record sales last year. I think people are confusing a full showroom with lack of sales. Court is right on, HD has challenges, but they sell bikes yet. | ||
| Davegess |
It is far better for a manufacturer to be running with demand and supply close together. When demand is really tight the dealers get all the extra profit as the sales price to them does not change but once a year except in really unusual circumstances. If you can build close to demand you can run your factory more efficiently and the more units you make the more $ you make. H-D is right about were they want to be. They are making money, just not breaking last quarters record. They do face challenges and may or may not be able to meet them but they have a ton of good people so I think they will. | ||
| Danger_dave |
No wonder they sell - I've just finished with the local press fleet and they are blardy nice machines. | ||
| Danger_dave |
What do you identify as the challenges Court and Dave? | ||
| Corporatemonkey |
I don't want to get into a pissing match with anyone, but here are some fine quotes to ponder. AP Harley-Davidson Idles 5,400 Workers Monday November 26, 7:22 pm ET By Emily Fredrix, AP Business Writer Harley-Davidson Idles 5,400 Workers This Week in Production Cut MILWAUKEE (AP) -- Some 5,400 Harley-Davidson Inc. workers are out of work this week as the motorcycle maker cuts production because of falling sales. The Milwaukee-based company announced in September it would shut down production at plants in Wisconsin, Kansas City, Mo., and York, Pa., this week as part of a planned cut in production. A shorter layoff is better than a long one, said Frank Larkin, a spokesman for the International Association of Machinists and Aerospace Workers, which represents workers at Harley-Davidson plants. At least workers were able to prepare for it, he said. "We were informed early on this was being proposed and we were able to relate to our members they would need to begin planning financially for one week without a paycheck," he said. Employees will still receive benefits during the week, he said. Harley-Davidson spokesman Bob Klein said the plant in York, Pa., the company's largest, has 2,800 workers idled this week. There are about 1,750 workers idled in Wisconsin at power-train operations in Wauwatosa and Menomonee Falls and another in Tomahawk. The Kansas City, Mo., plant has 850 workers idled. Workers in Pennsylvania weren't fazed by the shutdown, said Tom Boger, the business representative for the International Association of Machinists and Aerospace Workers Local 175 union. He said it was short and they had time to prepare. "People seem to be OK with it," he said. "It seems to be just no problem." Boger also said the shutdown was well-timed to go with the start of deer hunting season in Pennsylvania, meaning workers wouldn't have to take days off to hunt. Last month, Harley-Davidson reported its third-quarter profit fell 15.3 percent amid a continued sluggish U.S. market for motorcycles. The company said it expects next year to be difficult, too, as domestic buyers become more cautious about their spending given rising oil prices and slumping home sales. The company cut bike shipments and earnings expectations in September. Shipments were down 10.8 percent to 86,535 units in the most recent three-month period. Harley-Davidson expects full-year shipments to be between 328,000 and 332,000 units, down from 349,196 units last year. Shares of Harley-Davidson fell 8 cents to $46.45 Monday. AP S&P Lowers Harley-Davidson Ratings Wednesday November 28, 8:59 am ET Standard & Poor's Ratings Services Lowers Investment-Grade Ratings on Harley-Davidson NEW YORK (AP) -- Standard & Poor's Ratings Services on Wednesday lowered its investment-grade ratings on Harley-Davidson Inc., citing lower sales and profits because of a challenging retail motorcycle environment. Consumers have been cutting spending on nonessential items in recent months because of concerns about the housing downturn and eroding credit. The ratings agency cut the motorcycle company's corporate credit rating to "A" from "A+" and maintained an "A-1" CP rating on the Harley-Davidson financial-services division. The company's outlook is stable. Credit analyst Hal Diamond said in a statement that the downgrade also reflected reduced liquidity resulting from buybacks and dividend increases surpassing discretionary cash flow. AP Fitch Downgrades Harley-Davidson Friday November 30, 3:03 pm ET Fitch Lowers Debt Rating of Harley-Davidson, Citing Large Share Buybacks, Declining Sales NEW YORK (AP) -- Fitch Ratings on Friday downgraded the long-term issuer default rating of Harley-Davidson Inc. to "A+" from "AA-," citing lower cash balances because of large share buybacks, declining sales and weaker margins. Both ratings are investment-grade. Fitch offered a "Negative" rating outlook, saying it expects poor margins to continue into next year, compounded by smaller issues includes larger dividend payments and higher raw-material costs. The credit rating agency also lowered the short-term issuer default ratings of both Harley and its financial-services subsidiary and funding corporation to "F1" from "F1+." Now my take, I do think they are a well run company, but I think they need to get a handle on the brand. They have a good product, but are diluting the brand with reckless merchandizing. They need to downsize, to make the brand a premium player again. There is just too much good competition out there waiting to pounce. | ||
| Swampy |
Yes, I want to know what the future holds also. Me, living in the rust belt and personally shackeled here, I want to know what the next step is. Syknard: "And didn't even know we have the key" | ||
| Court |
Dave (NZ) You deserve and answer. I'll gather some notes over the next couple days for you. In the interim, it may not be wise to take stock picking advice from me . . . Both HD and Ducati posted nice gains today and Triumph took a shot on the nose . . . .  With regard to some of the "cut and paste" above . . . reread that carefully. And all the time, each time you see an event cited, ask yourself "who is pulling that lever". Decreasing output, in response to a challenging retail motorcycle environment. Consumers have been cutting spending on nonessential items in recent months because of concerns about the housing downturn and eroding credit. is not per se a "bad thing". It is to HD's credit that they can IDENTIFY and REACT to the market. It's the difference, sitting at the corporate controls between being a pilot and a passenger. Larger problems, I would suggest, would develop of the market went soft and HD, chanting some sort of HOG mantra, kept the knob set to "full output". One of the essential elements, when I evaluate a firm, is do they manage or watch? Dave, I'll get you your answers. Court (Message edited by court on January 14, 2008) |
