Harley Shipping Fewer Motorcycles

Trump Harley Feud Update – Harley is Shipping Fewer Bikes to the US

American Harley Davidson

Posted By

Clint Lawrence

Clint Lawrence, founder of Motorcycle Shippers. Helping give riders more freedom to enjoy the bikes they love. [email protected]

 
 
Where the Trump-Harley Feud Stands Now

Summer may feel like ages ago, but the feud that President Trump ignited with Harley-Davidson in June is still smoldering. Although the president has shifted his Twitter focus away from Harley (at least for now), the repercussions of the scuffle, the trade war and the motorcycle market dynamics have created a perfect storm for Harley-Davidson. (It’s a situation so stark that a recent Fortune Magazine headline reads, “Harley-Davidson Profit Wiped Out by Trump Tariffs.”)

Where does the Trump-Harley feud stand, and has the iconic motorcycle brand’s bottom line really been decimated by the dispute? Here’s the latest on Harley’s position in the motorcycle world and what factors are contributing to it.

(Need a quick refresh on the Trump-Harley feud? Check out our article.)

How the Trump war is hitting Harley

In September, Harley-Davidson celebrated its 115th anniversary with an event that drew 150,000 bikers to Milwaukee. The President had recently recommended that riders boycott the iconic brand, and unsurprisingly, reporters were in attendance to gauge the Trump-Harley fallout. One reporter summed it up this wayChart Showing Harley Davidson Sales Decline: Although the riders were indifferent about Harley’s response to the feud, they loved Trump.

That same month, bikers halfway across the country shared a much different sentiment with USA Today, pledging their loyalty to an iconic American brand. And in September, just months after Trump called a Harley boycott a “great idea,” the U.S. Secret Service put in an order for new Harleys with sidecars. Their justification? Secret Service mechanics already know how to service Harley-Davidsons; despite the political perceptions, the switch wasn’t worth the time or money.

Meanwhile, a key Harley competitor, Indian, saw a 4% surge in sales this fall. Following Harley’s decision to move some production overseas, Indian dealers reported a significant uptick in HOG trade-ins. Where does all this leave Harley-Davidson?

It’s impossible to fully gauge the biker community’s response to the Trump-Harley feud that exploded over the summer. But where the market is concerned, the impact has been crystal clear. Harley’s retail sales dropped 10% in the final three months of 2018. The company barely broke even in its most recently posted earnings

Steel Tubes with Tariff Logo

report. With eight quarters of consecutive declining sales, Harley’s shares tumbled by 9.5% to finish out a tough 2018.

Mainstream media headlines were quick to cite the impact of the Trump tariffs. “Once Lauded by Trump, Harley-Davidson is Now Sputtering,” read one CBS News piece from last month.

What’s really to blame?

Are the Trump tariffs the only reason for the brand’s decline? You can easily point to the lack of enthusiasm among Millennial riders, and you wouldn’t be out of line to cite the rise in electric motorcycles as a threat to the Harleys of the past. (Harley’s LiveWire electric motorcycle hits stores in August, with a cool $30K price tag.) Although it’s not the only factor making Harley sputter, the Trump tariffs have undoubtedly worsened the situation. The company told the SEC that the new EU tariffs added $2,000 to the cost of each motorcycle.

Keep in mind that it’s not all doom and gloom for the motorcycle market. Recent research shows that women riders have hit record numbers; they now account for 19% of the total U.S. rider population. And innovations like the ones from CES are becoming more prevalent in the motorcycles hitting dealerships, which could help entice more Millennials to embrace the ride. Still, Harley’s executives predict 2019 will be another tough year for the brand.

Harley estimates that it will ship between 217,000 and 220,000 bikes to the U.S. this year—one of Harley’s lowest shipment rates since 2010. Between already-declining sales and the continuing trade war, the situation begs the question: Will extravagant anniversary bike rallies in Milwaukee soon be a thing of the past?

Where do you stand on the Trump-Harley feud? How important is it for your motorcycle (and its parts) to be manufactured in the U.S.?