how can harley davidson improve

How Can Harley Davidson Improve? Our Detailed Analysis

As a long-standing symbol of tradition with an impressive 118 years at the helm, Harley Davidson may not appear prepared to succeed in today’s ever-changing landscape where cars are becoming increasingly automated, electric and shared. This article looks into how can Harley Davidson improve its business practices and stay ahead of these trends for future success.

Harley Davidson’s current situation

Harley Davidson’s U.S. bike sales skyrocketed to a staggering 260,000 in 2006, however since then have drastically plummeted by about 40%. Aging demographics can be attributed as one of the reasons for this decline – with the average age of motorcycle owners jumping from 27 in 1985 all the way up to 50 today. This goes to show that Harley Davidson has not been able reach out and attract younger generations over recent years, leading them down an unfortunate path.

In order to tackle the current obstacles ahead, Harley Davidson’s president and CEO Jochen Zeitz has launched “Rewire,” a strategic plan designed to refocus the company on promising growth markets located in North America, Europe and Asia.

Harley Davidson’s “Rewire” initiative

After implementing the Rewire initiative, the manufacturer has strategically exited from low-potential international markets and concentrated on 36 high-growth regions. Additionally, they reduced their costs by laying off 700 employees and formed a distribution agreement with Indian motorcycle maker Hero in late 2020. Furthermore, they spun off their electric bike operations to an independent entity where they retain only a minority stake.

Garrett Nelson, senior equity analyst at CFRA Research believes Harley is headed in the right direction. He applauded their October agreement with Hero for being a win-win situation for both companies.

Focus on growing markets

It is essential for Harley to capitalize on opportunities with other key players in order to expand its reach into Asian markets that are quickly flourishing. “As of now, their distribution network is far too broad,” Nelson mentioned. “Gaining a larger foothold there is an absolute necessity since we think the North American market isn’t growing as much.” On the contrary, Europe’s market continues to grow and the newly-launched Pan America should thrive over there.

Investing in electric vehicles

Citi analyst Shawn Collins suggested a specific plan of action for Harley Davidson’s electric motorcycle, the Livewire. This particular vehicle is retailing at around $30,000 and it happens to be one of the pricier motorcycles that they offer this 2021 model year.

As time passes, we are confident in the potential of electric vehicles given the decreasing costs associated with lithium-ion batteries and economic support from the new administration, Nelson stated.

Shifting focus to brand exclusivity

To adapt to the ever-changing consumer market, Harley Davidson is placing more emphasis on exclusivity rather than increasing their overall sales. In lieu of attempting to increase their market share by selling more bikes, they are striving to make a bigger profit from every single sale – regardless how many bikes they sell overall.

Streamlining product portfolio

To maximize success, Harley Davidson has made the wise decision to streamline its product offering by removing underperforming models and discontinuing a selection of 2021 US portfolio products including FXDR 114, Low Rider, Breakout, Street Bob 107, Deluxe, Street 750 ,Street Rod and Roadster.

As a result, the manufacturer continues to offer their lineup of approximately two dozen motorcycles, mainly in cruiser and touring segments. Additionally, they also have three distinct trike models available.

Harley Davidson is trimming down its product line by about 30%, creating a much more efficient selection, and subsequently saving money in the process. With fewer models to focus on, Harley- Davidson now has the opportunity to individualize bikes with robust options such as custom paint jobs, luggage attachments and seat upgrades; all while providing an additional revenue stream for themselves. This allows customers to make their bike one of a kind while also giving them value for their purchase.

Streamlining the product portfolio may not alone revive a struggling business, however, it is an essential part of any comprehensive plan that seeks to maximize revenue and minimize costs – ultimately leading to greater profits.

Harley Davidson must strike a balance between reinvigorating its core operations and venturing into new markets, all the while prioritizing profitability over size. This will enable Harley Davidson to concentrate on their more lucrative parts and accessories as well as general merchandise segments that are integral in driving success.

Expanding parts and accessories business

To further capitalize on their success, Harley Davidson should focus on growing its parts and accessories business. That way, riders can customize their bike to reflect their own unique style with personalized details such as paint jobs, luggage sets, seats upgrades, stereo systems installations and more.

Although this approach may not instantly cause a revenue increase, it is an essential part of the bigger picture plan for driving up profits while controlling costs and maximizing income. Zeitz realizes the potential in bike parts and Harley lifestyle items.

Should Harley Davidson Expand Internationally?

Harley Davidson’s Rewire initiative has allowed them to make a strategic shift, allowing the company to concentrate its efforts on 36 development-oriented markets in North America, Europe and Asia while leaving behind international regions with low prospects.

To reduce costs and finish off the year on a high note, the company laid off 700 employees and entered into an agreement of distribution with Indian motorcycle maker Hero.

According to this data, Harley Davidson appears to be expanding into areas of high growth potential as opposed to broadening their global reach. They may consider additional chances with established players in faster-growing Asian nations; however, right now they are concentrating on developing a dominant presence in critical markets with great opportunities.

Consequently, Harley Davidson should concentrate on developing in high-growth-potential areas that have the potential to yield greater profits instead of attempting to saturate every country with its products.

How Can Harley Davidson Improve

To sum up, Harley Davidson is currently facing several obstacles in the evolving world. Fortunately, its recognizable brand name and massive customer base give it a leg up against other companies. In reaction to these changes, Zeitz has implemented the “Rewire” strategy to redirect efforts towards profitable opportunities.

Harley Davidson should explore opportunities with other well established organizations to bolster their presence in the rapidly growing Asian market. Additionally, strategic investment into electric bikes and streamlining of product offerings are necessary – focusing on expanding parts and accessories would accompany this strategy nicely. Despite trimming down its portfolio offering, Harley Davidson still provides nearly two dozen different motorcycles as well as a trio of three wheeled bikes; these primarily revolve around cruiser production and touring consumer desires.

At Harley’s upcoming investor day event, the management team will need to prove their commitment to top-line growth in order to retain investors’ trust. “Zeitz definitely has a lot of fans, but he faces a major challenge,” noted Collins from Citi Research. “There won’t be any straightforward solutions here; thus far we’ve seen poor performance on revenue.”

According to Craig Kennison – a senior research analyst and director of research operations at Baird – Harley Davidson is indisputably the most valuable motorcycle brand in the world. Its powerful image, massive size, as well as its devoted customer base are factors that give it an edge over its rivals.

For years, Harley Davidson has been aware that they need to target younger customers. Zeitz’s mission is to restore the allure of owning a Harley so more young adults will want one for themselves. This desire is what he hopes will come about in the next three to five years with his vision and efforts.

Harley Davidson is staying ahead of the curve, and must remain committed to optimizing its profits. Their iconic brand name combined with fresh management should help them overcome any impediments they encounter as they navigate an ever-shifting landscape.


Here are some FAQs based on the article on How can Harley Davidson improve:

What is Harley Davidson’s current position in the motorcycle market?

In the ever-changing world we live in, Harley Davidson has been experiencing numerous difficulties. Though its renowned brand is still appealing, it’s success have wavered considerably over time.
US bike sales hit their peak in 2006, but since then the numbers have declined by a staggering 40%. An aging population plays a big part of this story – motorcyclists’ median age has gone from 27 to 50 between 1985 and 2018.

What initiatives have been implemented to turn Harley Davidson around?

Under the directorship of Jochen Zeitz, President and CEO of Harley Davidson, ambitious plans have been put into action to reinvigorate the organization. The “Rewire” strategy has enabled them to concentrate on areas with promising growth potential that will stimulate their future success.
In order to maximize efficiency and profitability, the company has chosen to exit markets with low potential and instead focus on 36 vastly more promising areas across North America, Europe, and Asia.
They have also made difficult decisions such as cutting 700 jobs in addition to establishing a distribution agreement with Indian motorcycle manufacturer Hero. Additionally, they spun off their electric bike operations into a separate firm where they maintain a minor ownership stake.

What is Harley Davidson’s plan for 2021 to 2025?

Harley Davidson has announced their new “Hardwire” plan for 2021 to 2025, which it states is founded on desirability. However, the specifics of this strategy remain undisclosed at this time.

What challenges does Harley Davidson face in appealing to younger riders?

Harley Davidson is facing a major challenge in their struggle to attract younger riders. Many young consumers are hesitant to purchase motorcycles due to safety concerns, the rise of ridesharing services and financially driven urbanization trends. What’s more, they may have different expectations from Harley Davidson’s current user base regarding what they want out of a motorcycle experience.

What has Harley Davidson done to improve its profitability?

Understanding that broadening their global presence wasn’t the way to go, Harley Davidson has shifted its focus from aiming for absolute market share growth towards creating a more exclusive brand identity. The Rewire plan was an observance of this move and understanding.
Harley Davidson is now altering their strategy to maximize profits from each sale, even if that means selling fewer bikes. By cutting its product line by 30%, the company has streamlined costs and optimized efficiency. Furthermore, Harley Davidson’s parts and accessories business is growing rapidly; this gives customers an opportunity to customize their bike while simultaneously providing more revenue streams for Harley Davidson as well.

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