Harley-Davidson boss Jochen Zeitz has updated his turnaround strategy after the company recorded a $US92 million net loss in the second quarter of 2020.
Zeitz had already implemented his ‘Rewire’ campaign in an attempt to save the struggling business, however, Zeitz has followed up with his new ‘Hardwire’ strategy, which will see more extreme measures put in place.
Bloomberg reports that Harley-Davidson has cut roughly 14 per cent of its workforce, while the Hardwire strategy will also see the brand reduce its line-up by 30 per cent and delay the launch of its Pan America adventure bike and Bronx Streetfighter.
The company says it will concentrate its efforts on 50 markets, of its roughly 100-market reach, mostly in North America, Europe and some parts of Asia.
“We’re not willing to sacrifice the strength of our legacy in a quest for pure volume growth going forward,” said Zeitz.
“We are an extraordinary and desirable brand but that doesn’t mean we want to become everything for everybody.”
The Covid-19 pandemic has had a significant impact on Harley-Davidson, forcing it to suspend production for several weeks and decrease dealer inventory by a reported 32 per cent.
However, there are clearly bigger factors at play as the brand has posted sales slips for the past five consecutive years in its domestic market.
Zeitz has not defined which models will get the cut, although he has suggested that its current range of products can be confusing.
“We have extraordinary product and more product in the pipeline, but the complexity of our product lineup has been quite substantial,” he said.
“Sometimes it’s even hard to know what product is what, and that complexity might be, for some customers, confusing at times, especially for those who come into the brand and would like to buy a new bike.
“That is not a huge problem but that is something that makes our lives from a product development and investment point of view more difficult.”
Harley-Davidson will invest savings from its cost cuts into a new marketing campaign, as it attempts to reinvigorate the once-monumental brand.
This will include a new social media effort directed by actor and motorcyclist Jason Momoa.
The company is also attempting to reach a new type of customer with the Livewire electric bike, which will be available in Australia later this year, priced from $49,995 rideaway.
Spencer has a keen eye for hard news, and does some of his best living on deadline day. He loves more than anything to travel on his motorcycle, and is adamant that Melbourne Bitter is a world-class lager. He also knows how to operate the big computery thing in the office. By night, Spencer plays guitar with Melbourne punk outfit LOJO LOUTS.