Will The Economy Force Harley-Davidson To Change Tactics
Much has been said the last few months regarding H-D’s future. Major stock analysts are calling for a hold on H-D stock as events unfold. With equity firm KKR making a bid to position itself to acquire Harley-Davidson, other companies have similarly made overtones….which begs the question, is the company for sale or considering it? At this point the company and it’s expansive product line are a major undertaking. Global expansion in new markets has not come without cost and the development of new products such as the Street 500 were necessary to try and gain any kind of foothold in markets where big twins and touring bikes are just not practical and remain a niche item. For example, in Australia and most countries 6 out of 10 new bike sales are 500cc and under….because…..you guessed it, that’s the restriction on size for new riders.
The majority of new Harley-Davidson sales are repeat customers, loyal to the brand. When it comes to trading up they’re not being offered a worthwhile valuation on their used bike, making it necessary for them to pursue selling it privately to get top dollar. Harley-Davidson has always encouraged dealers to upsell walk in customers looking for a used Harley-Davidson, and steer them towards the new models and financing if needed. H-D is now in a position where it realizes unless they support the used bike market and build programs around it such as warranty and financing, they may be missing out on a substantial chunk of repeat buyers and the increased revenue both from sales and financing. Rider and bike accessories also would benefit and see increased numbers. So, will there be used Harley-Davidson financing and dealer support? Time will tell, but then again…these are uncertain times. In the meantime…the wolves keep circling.