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White
Posted on Thursday, October 15, 2009 - 03:05 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

Thanks Court! Looking forward to hearing from you.
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Edmbueller
Posted on Thursday, October 15, 2009 - 03:06 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

Court;

I look forward to your calming voice of reason and facts in this whirlwind of rumors and conjecture.
Darcy
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Court
Posted on Thursday, October 15, 2009 - 03:16 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

UPDATE:


quote:

Highlights From HOG's Q3 Conference Call; Discontinues Buell Brand, Sees More Dealerships Closing in N-T, But Int'l Growing

1:13 pm ET 10/15/2009 - StreetInsider

Harley-Davidson (NYSE: HOG) reports Q3 EPS of $0.11, which includes items and may not compare to the analyst estimate of $0.21. Revenue for the quarter was $1.12 billion, which compares to the estimate of $1.1 billion. Surprisingly, shares are up 3.5% today.





Highlights From HOG's Q3 Conference Call:

Harley-Davidson is narrowing its guidance for full-year 2009 shipments, and now expects to ship 222,000 to 227,000 Harley-Davidson motorcycles to dealers, including 35,000 to 40,000 during the fourth quarter. The Company continues to expect full-year gross margins to be between 30.5%-31.5%.

Harley-Davidson also unveiled major elements of its go-forward business strategy to drive growth through a single-minded focus of efforts and resources on the unique strengths of the Harley-Davidson brand, and to enhance productivity and profitability through continuous improvement. As approved yesterday by Harley-Davidson's Board of Directors, the Company will discontinue its Buell product line and divest its MV Agusta unit as part of this strategy.

(CFO) To-date we are on track with previously announced restructuring activities. We're working to reduce administrative cost, eliminate excess capacity and exit non-core operations.

Our decision to discontinue Buell and sell MV Agusta takes into consideration the following. Investment in the Harley-Davidson brand has provided greater returns than either the Buell or MV Agusta brands. Harley-Davidson customers have a much higher repeat purchase intend and our success in attracting new customers to the Harley-Davidson brand indicates the brand is well positioned to grow worldwide in the future.

The Buell dealer network will continue to sell new motorcycles into 2010 and provide service into the future. We have chosen to discontinue the Buell product line as oppose to selling the business in part because Buell is so integrated into the Harley-Davidson business systems and distribution network. From an accounting perspective, Buell is not considered a separate and distinct operation and as a result will not be presented separately as a discontinued operation.

Of approximately 125 million in total cost associated with the discontinuation of Buell. We expect to incur approximately $55 million of restructuring and impairment cost in 2009 related to contractual requirements, write down of asset and severance benefits. We also expect to reduce our hourly workforce by approximately 80 employees and our non-production primarily salaried workforce by approximately 100 employees.

During Q2, we recorded a $14.2 million impairment charge relate to the fixed asset associated with Buell.

In addition to restructuring charges, we anticipate approximately $60 million in cost related to helping our dealer sell their inventory and charges for absolute inventory which will negatively impact gross margin in Q4. In addition, we expect approximately $10 million of cost in 2010. Buell revenue was $134.9 million in 2008 and $59.4 million 2009 year-to-date.

Turning to our plans to divest MV Agusta. Like Buell ongoing investment in MV Agusta does not align with the company's long-term strategy. MV Agusta has value driven by its respected heritage, exciting products and passionate workforce. It is a standalone entity with a separate distribution network. As a result we expect to report MV Agusta results as a discontinued operation which means MV revenue, cost and earnings will be reported as a separate line item below Harley-Davidson's income from continuing operations beginning in Q4.

MV Agusta revenue was 15.9 million in 2008 and 42.9 million September year-to-date. Net losses were 30.1 million in 2008 and 52.6 million through the first nine months of 2009. This includes the $18.9 million, I'm sorry, this includes an $18.9 million impairment charge of good will related to the purchase of MV Agusta recorded in the third quarter.

Our third area of focus has been to obtain funding to support the lending activities of HDFS. I'm very pleased to report that we have exceeded our $1 billion 2009 funding needs by 1.9 billion which will support any 2010 funding needs including the mitigation of 2010 financing risks. Last week we closed a $700 million TALF-eligible term securitization. We saw a strong demand in the weighted average interest rate drop to just 1.2% from 2.1% in our July transaction.

Worldwide, dealer retail sales of Harley-Davidson motorcycles during the third quarter were down 21.3% compared to down 9.6% in 2008.

On a sequential basis, worldwide sales were down less than they were in the second quarter of this year when they were down 30.1%.

During Q3, U.S. Harley-Davidson motorcycle retail sales decreased 24.3% while the U.S. 651 plus cc motorcycle market dropped 35.9%. Our market share was up 8.4 percentage points to 53.8% in the quarter versus last year.

In the international markets, we saw a sequential improvement with sales being down 13.1% in Q3 versus down 18.2% last quarter.

Between 2007 and 2008, we trimmed year end U.S. dealer inventory by approximately 22,000 units and as you know, we have taken actions in 2009 to reduce shipments which we believe will result in significantly lower inventories at the end of 2009 compared to last year.

To-date, four dealers and 10 secondary dealer locations have closed and we have, we expect 15 to 30 dealer points could close during the next six months.

Also, our shipments of Harley-Davidson motorcycles for the third quarter were 54,236, down 20,468 units from the same quarter last year in line with our third quarter shipment guidance and consistent with our previous annual shipment projection of being down 25 to 30% from 2008.

Revenue from Harley-Davidson motorcycles decreased to $803.3 million from Q3 of 2008 primarily as a result of 27.4% lower shipments of Harley Davidson motorcycles during the quarter partially offset by a favorable shipment mix resulting in increased average revenue per unit of $1,006.

Total revenue for the segment was 1.12 billion, down 21.2% from Q3 2008.

Gross margins in the quarter decreased to 33.1% of revenue compared to last year.

We are pleased to maintain our expectation of full year gross margin between 30.5 and 31.5% despite the impact from discontinuing the Buell product line.

For Q4, we expect gross margins to be negatively impacted by fixed cost spread over 14, the 19,000 fewer units and the impact of approximately $60 million charge resulting from the discontinuation of Buell.

Operating margin for Q3 2009 decreased to 9.5%, negatively impacted by lower gross margin, restructuring charges and asset and goodwill impairments, partially offset by lower SG&A funding.

Now moving on to our Financial Services segment. During Q3 HDFS reported an operating loss of 31.5 million, a decrease of 67.1 million compared to last year. This decrease was driven by several items. First, a $41.4 million increase in the provision for retail loan loss allowance. Of that total, 28 million was due to expected higher loss incidents and lower recovery values of repossessed motorcycles in the future.

(Chief Operating Officer, Harley-Davidson Financial Services) During Q3, HDFS originated 588 million in retail motorcycle loans compared to 821 million in the third quarter of 2008. This 28% decrease is primarily attributable to lower retail sales of Harley-Davidson motorcycles in the U.S.

HDFS retail market share of new Harley-Davidson motorcycle sold in the U.S. was 51.2% in the third quarter of 2009 compared to 57.6% in the third quarter of 2008. This decrease in market share shows that there continues to be a competitive marketplace in retail financing for Harley-Davidson motorcycles.

At the end of Q3 approximately 5.18 billion of receivables were classified as held for investment. Of these receivables, 938.6 million were wholesale and 4.24 billion were retail.

Regarding delinquencies and credit losses, the impact of the recession and high unemployment continue to drive increases. The 30-day delinquency rates for managed retail motorcycle loans at September 27, 2009 is 5.8% compared to 5.59% at the end of Q3 of 2008.

From a credit loss perspective, annualized retail credit losses totaled 2.7% for the year-to-date versus 1.97% last year.

(CFO) Cash and cash equivalents as of the end of the quarter totaled 1.52 billion.

(CEO) Between now and 2014, we expect to expand our international dealer network by 100 to 150 dealer points primarily in markets where we already have a presence and see opportunities to create and fulfill additional demand. In Mexico, for example we are going to 13 dealers this year from the eight that we had at the start of 2009.

And with our product plan we are confident that we will continue to expand the appeal of Harley-Davidson motorcycles to the under age, under 35 age group.

And we expect earnings to grow at a faster rate than revenue through 2014 including productivity savings net of inflation of 120 to $150 million including the restructuring of our York operations and SG&A to decrease as a percentage of revenue.

(Q&A) Keith, could you just clarify one of the last statements you made there the 120 to $150 million, if you could just maybe go through that again and expand on that last statement and was that inclusive or exclusive of what you're looking to do at York? (A)That is inclusive of the restructuring at York and its net of inflation.

Okay, so over a 120 to $115 million, is that so that's you already restarting post the savings that you've already outlined with the restructuring again through 14 or I guess everything collective? (A)Yeah, that's post.

Okay, so the 140 to 150 and add another 120 to 150 on to that what's you are saying? (A) Yes.

And then the other question is it appears that you all are very comfortable with the sell-through that you are seeing right now or the levels of inventory in the channels you narrowed your guidance to the upper half of the range, should we anticipate any - on a go-forward basis, your productions and to basically match the sell-through that we are seeing? (A)What we've given for the remainder of this year, beyond this year Tim?

Beyond this year, I mean, if you take looking forward, just as a general rule do you want to expand basically any supply demand gap that's there or do you want to kind of keep it where it is and let that fluctuate and according to how your sell-through goes? (A)By the end of the year, we are very comfortable where inventory levels are and they will decrease between now and the end of the year as we take our production down. As we move in the 2010, we will look to keep that inventory level tight through 2010.

Okay, okay, and then may be a question for Larry or whoever wants to take this. Given what you outline with HDFS, we're assuming no further improvement, no deterioration in the current economic environment. Would you anticipate your reserves in that, at what point would you anticipate the level of reserve that you're taking to moderate or maybe turn positive? (A)I think really probably two things would be drivers of that. One is obviously we're looking at unemployment very closely. So if we start to see improvement and unemployment; I think that's going to have a positive impact on our portfolio and then the required reserve levels. And I think the second thing, as I talked about is, we made significant changes to our underwriting criteria, beginning 2009. We're seeing positive trends there as that, as those new assets become a greater percentage of the total portfolio over time. Today they're not that bigger percentage of total portfolio, but over time as they become a bigger percentage that should drive better credit performance and lower reserve requirements.

Good morning and John, congratulations on your new permanent role. Don't think I've been a part of the quarter with packed with more information than this, so I'll try to be brief. With respect to your negotiations in York, can you give us an update on your upcoming events as the year concludes? (A)We are currently in negotiations with our labor union and I would characterize those as just being sort of in the beginning phases and we do expect and will have an answer and a decision on New York sometime between the 1st and 31st of December and whereby we will either be staying in New York and restructuring that operation in a way that will be sustainable for our company going forward or we will then move the operations to another location.

Harley-Davidson, Inc., through its subsidiaries, produces heavyweight motorcycles, as well as offers motorcycle parts, accessories, and related services.





Read . . . think . . . don't jump to conclusions. We'll talk more. The plan is not to "just survive", but rather to win.

Think.
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Hughlysses
Posted on Thursday, October 15, 2009 - 03:29 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

Well, I already believe in one Resurrection...
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Moxnix
Posted on Thursday, October 15, 2009 - 03:32 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

After wringing my hands, gnashing my teeth and tearing my collar, I'm given to opine there may yet be a light at the end of today's announced tunnel. Triumph doing okay, Norton about to go back into production financed by a very savvy chap's bankroll, BMWs not what they used to be, new Egli Vincents available, new Manx Nortons and Matchless G50s, there may yet be a place for the Buell. Once the emotional charge has worn off this seeming crisis, the voices of reason will come out with a few ideas that offer hope.

The concepts and ingenuity brought to the market by The Erik are not likely to stop with today's news.
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Sayitaintso
Posted on Thursday, October 15, 2009 - 03:45 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

And with our product plan we are confident that we will continue to expand the appeal of Harley-Davidson motorcycles to the under age, under 35 age group.


I would be very interested to see what's in the product plan that would bring interest to the under 35 crowd..... only thing out there that I see is the XR and maybe the Nightster


(Message edited by sayitaintso on October 15, 2009)
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Xl_cheese
Posted on Thursday, October 15, 2009 - 03:46 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

I'm bored at work today so I thought I'd see what the "other" forums thought of this. Interesting that they are all pretty much disappointed just like we are.


http://forum.svrider.com/showthread.php?t=112953

http://www.r1-forum.com/forums/showthread.php?t=27 5782

http://www.gixxer.com/forums/showthread.php?t=2449 09

http://www.kawiforums.com/two-wheeled-discussion/1 43646-buell-just-folded.html

http://www.1000rr.net/forums/showthread.php?t=6821 0
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Bud
Posted on Thursday, October 15, 2009 - 03:48 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

i really don't here any fat lady singing yet


dedicated to buell, yep,
not only skin deep,

how much i have tears in my eyes from hearing Erik announcing probleby the worse clip he ever had to make,

i don't think the saga ends here,
but the next periode is going to be very tough.

Erik, Kim, Henry, Tom, Jamie, Bob
hang in there..
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Crackhead
Posted on Thursday, October 15, 2009 - 03:49 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

what % of HD stock is publicly traded? could we beat them at their own game?
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Ridenusa4l
Posted on Thursday, October 15, 2009 - 03:54 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

Court I'll be up all night waiting for a calming word, to ease my/our mind(s), im completely torn up with this, i LOVE my bike,i LOVE the USA(which includes family and friends), and i LOVE buell, and when any of them are in trouble i get upset(pissed)...

RIDEN USA 4 LIFE
Jake
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Chadhargis
Posted on Thursday, October 15, 2009 - 03:54 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

A hostile takeover?? Humm......
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Hughlysses
Posted on Thursday, October 15, 2009 - 03:58 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

I sure hope SOMEBODY can figure out how to focus and point all this pent up anger in a direction that will HELP Erik Buell and company quickly.

Standing by for suggestions....
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Poppinsexz
Posted on Thursday, October 15, 2009 - 04:02 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

I guess my one big question is - who owns the Buell patents, name, logo and other associated stuff?
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Buellkowski
Posted on Thursday, October 15, 2009 - 04:04 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

From the Buell website's Legal Notice: Buell, FIREBOLT, LIGHTNING, BLAST & ULYSSES are among the trademarks of H-D Michigan, LLC.

In addition to everything else Buell-related, H-D also owns the Buell (R) name, which they value so little they won't even consider selling it (yet). Think hard about losing your name and perhaps you'd be in tears, too.

So help me, if H-D rebadges even ONE former Buell...
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Carbonbigfoot
Posted on Thursday, October 15, 2009 - 04:04 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

You wanna talk "hostile", take a look at the XB board....

Haven't seen so many red dots before!

Wow.

R
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Davefla
Posted on Thursday, October 15, 2009 - 04:11 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

Think I'll stop in at my local H-D/Buell dealer and, following my purchase of whatever Buell clothing I can find on the half a rack they devoted to the products, gently explain why they won't be seeing much of me in future. It starts with the fact that the local Triumph/Ducati/KTM dealership is very nice.
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Garp
Posted on Thursday, October 15, 2009 - 04:17 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

what % of HD stock is publicly traded? could we beat them at their own game?

Their Market Capitalization is about 6.5 Billion. You want to start a Paypal account for contributions
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Ridenusa4l
Posted on Thursday, October 15, 2009 - 04:24 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

+ infinity Bud

Jake
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Jaimec
Posted on Thursday, October 15, 2009 - 04:39 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

I've gotten spoiled by belt drive. It'll be hard to even consider something with a chain. Guess that leaves BMW as the sportiest brand out there WITHOUT a chain drive.

Not the S1000RR, mind you, but the R1200S or the K1300S are starting to look better and better despite the steep price.
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Chadhargis
Posted on Thursday, October 15, 2009 - 04:39 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)


quote:

Their Market Capitalization is about 6.5 Billion.




Anyone here owed a favor by Warren Buffet or Bill Gates?
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Conchop
Posted on Thursday, October 15, 2009 - 04:43 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

Court / Erik

Just a quick note. Perhaps I can help. I know people who have available factory space and manufacturing experience. Robotics- local steel and aluminum availability - very inexpensive electricity and utilities. I can perhaps fix things with local political powers for help in funding and taxes.

consolidatedchopper@yahoo.com

Tough times -
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Carbonbigfoot
Posted on Thursday, October 15, 2009 - 04:54 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

Maybe PMC? The Pegasus Motorcycle Company?

R
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Xbmacon
Posted on Thursday, October 15, 2009 - 05:05 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

I'm left really shocked and puzzled...
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Lars1974
Posted on Thursday, October 15, 2009 - 05:09 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

i shall buy an extra lottery ticket this weekend and if i win - i know which direction my money goes....

Thanks to Erik and the team and to Court for keeping us informed!
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Lastcyclone
Posted on Thursday, October 15, 2009 - 05:10 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

"Buell is not considered a separate and distinct operation and as a result will not be presented separately as a discontinued operation."

What the heck does this mean?
Isn't that a double negative?


(Message edited by lastcyclone on October 15, 2009)
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Tipsymcstagger
Posted on Thursday, October 15, 2009 - 05:22 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)


quote:

What the heck does this mean?
Isn't that a double negative?


Sounds to me they're saying Buell is considered a product line, not a subsidiary or separate entity.

Tipsy
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Scooter808484
Posted on Thursday, October 15, 2009 - 05:32 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

Harley-Davidson customers have a much higher repeat purchase intend and ...

This particular Harley-Davidson customer no longer has ANY repeat purchase intend.

Trying to remain calm, but it's quite difficult....
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Randomchaos
Posted on Thursday, October 15, 2009 - 05:33 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

Court, I greatly look forward to your words. That quoted post you made really was just a bunch of number tossing to me. Made little to no sense at all.
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Hooper
Posted on Thursday, October 15, 2009 - 05:35 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

Wow, there is some real venom on those other bike forums. The Suzuki SV (v-twins sticking together) and Yamaha R1 people seemed to be the most kind. I've never ventured to other bike sites...that was a little bit maddening.
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Ferris_von_bueller
Posted on Thursday, October 15, 2009 - 05:41 pm:   Edit Post Delete Post View Post/Check IP Print Post    Move Post (Custodian/Admin Only) Ban Poster IP (Custodian/Admin only)

I'm having a hard time reconciling the near broken man I saw in the video on Buell.com with the optimism of Court. If there ever was a time, now would be the time to hear the rest of the story. "Remind me to tell you sometime" would be NOW.
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