I’ve alerted people to the fact that the groundwork is being laid for a new kind of Harley-Davidson company in the future. It’s anticipated they will need to aggressively streamline brands, shrink capacity and either eliminate or phase-out certain poor performing models.
Then this past weekend while many of us were in the Nevada desert, hundreds of rain soaked shareholders packed the Harley-Davidson Museum in Wisconsin to hear the top executives plans for the company. Or as retiring CEO James Ziemer put it… “one of the most challenging economic times since the Great Depression.” The Milwaukee Business Journal has more details HERE. In short, Barry Allen, a director since 1992 was elected as the new board chairman and shareholders voted to end the class structure of company’s director terms. Essentially putting the board on notice through an annual re-election process. Also former CEO and current board of directors chairman Jeffrey Bleustein’s formal involvement in the company came to an end.
Ziemer stated that “the company’s fixed cost structure is simply too high.” They plan to reduce excess capacity and make changes to be more competitive for the long term. Several shareholders booed Ziemer on the decision to consolidate factories. Does this imply Harley will now need to consider new China-based facilities to offer a world-class cost structure? Would manufacturing motorcycles in China disrespect the rich heritage of the Harley brand and the importance of the Americana culture? In today’s world I’m not so sure it matters to the price savvy consumer.
And speaking of the economy it’s not a surprise, but odd that Harley-Davidson did NOT participate in the Laughlin River Run last week. Given that customers are now investing more in their current motorcycle vs. trading up you’d think that the largest west coast motorcycle rally is not an event to be snubbed. Most all the Asian brands were well represented and HD being absent was clearly noticed.
Lastly, either in a sign of these recessionary times or nostalgic admiration for his remarkable 40 year career, the employees presented Ziemer with the original wood doors from the freight elevator he operated when he first was hired at Harley-Davidson. Ziemer’s 2008 compensation ($5.6M) should allow him to build a new wooden ‘man’ shack to admire those elevator doors during retirement!
Photo courtesy of HD
Northwest Harley Blog 
[…] he was named President and Chief Executive Officer of Harley-Davidson. When he retired, employees presented Mr. Ziemer with the original wood doors from the freight elevator he operated when he first was hired at […]