Connecting With Harley-Davidson

I’m talking about rider “connectivity” which has become a topic of discussion and debate in certain circles.

Technology content, infotainment and virtual connectivity all seem to be the metrics by which a growing portion of the motorcycle community defines the performance or desirability of a motorcycle. 

Don’t get me wrong, I’m a big fan of connectivity in motorcycles, but it’s not the kind that involves touchscreens, phones, Nav, satellite radio and cell towers. My definition of connectivity involves the seat of your pants, your hands on oversized handlebars and your feet on the pegs. 

It’s the visceral connection, not the blue-tooth connected one!  It’s the emotional and physical connection, the one that makes you want to ride it. How does the infotainment touchscreen with VOX interrupts provide that?

I’ll assume most Harley owners are as passionate about riding their motorcycles as I am.  Yet, as I travel around it seems many of you are suffering from a “connection disorder” — an affliction that occurs when a rider can’t connect their multitude of electronic devices with their motorcycle!  

I want to connect via my senses, not my phone. Direct steering feel, linear brakes, great lateral grip and the melodious exhaust soundtrack are what connect me when I’m riding.  I want a motorcycle that puts me deep into the rider, motorcycle and road feedback loop.  Not one that isolates me from it.  Or distracts me from my riding senses.

How did this Harley-Davidson connection disorder come about?

It started with the launch of the Boom! Box Infotainment System and the affliction has grown exponentially.  Back in the day, multitasking while riding was about downshifting smoothly while braking and throttling up for the next corner.  Multitasking today is about loudly shouting to activate the intercom while navigating through menu tabs to deactivate your appointment alert.

Historically a mechanical aptitude and a passion for motorcycles was everything needed to enthusiastically explore the world of 2-wheel vehicle dynamics.  In 2015,  you’ll need some “tech genes” in your family tree or be prepared to visit a genius bar in the Harley-Davidson dealership.

I’m unsure why Harley-Davidson is so busy developing and marketing motorcycle connectivity technologies that don’t even involve being on the motorcycle, much less riding it.  Can you spell “wearables”…  It won’t be long before your watch connects to the infotainment system.  Monitoring your heart rate as you cruise the two-lane blacktop is something all riders will want, right?

As I’ve traveled around this year I’ve witnessed riders affected with the disorder — not many at first, but enough to know I was witnessing a connection disorder trend that will only spread.  I hope it’s not contagious!

Photos courtesy of H-D

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The Harley-Davidson Saddlebag Recall

Saddlebag Sketch

This is more than a simple saddle bag retaining clip that takes less than 10 minutes to replace.

Harley-Davidson is facing steep competition.  Not only from less expensive motorcycles imported from Asia, but electric motorcycles from Zero, Brammo (now owned by Polaris) and also from core customers who look for a mainstream gasoline cruiser from Indian and Victory.  Polaris will undoubtedly be first to market with a chrome-plated electric cruiser given the previous discussion by CEO Matt Levatich.

In addition, it’s not clear that Harley-Davidson is getting much of a sales bump from the decision to double-down on support of outlaw biker gangs as part of their marketing pitch.  The hard-edge reference is NOT about the one-percent patches, rather licensing support of TV shows like Sons of Anarchy (SOA) and other Hollywood fluff.  Trying to appeal to people who don’t have much adventure in their lives with a TV show prescribing on the road escapism… well it escapes me!   Meanwhile they try so hard to alienate and re-write the Baby Boomer chapter!

But I’ve digressed.

Harley-Davidson reported slipping revenues for Q2 2015.  U.S. market share is below 50% for the first time ever!  The company is betting on its name recognition and motorcycle quality.  They even choose to muster up some brash swagger and declined slashing prices as a subtle way of saying “our bikes are better!”

And on that quality topic, Harley recently issued a saddlebag recall – campaign number 15V-427.  The motor company is the poster child for the “land of recalls” sans Chevy.  So many, that owners find it difficult to recall when their bikes didn’t!

Snarky comments aside, all manufactures have issues, but Harley-Davidson is unique in acknowledging and using quality as a key differentiator and strategy for increasing sales.  I’m not sure how well that will work for them.

Meanwhile the Dealers are replacing the 4 (2 on each side) saddle bag pin retaining clips free of charge. The motor company issued a recall stating that the saddlebag mounting receptacle, P/N 10900009 on some model year 2014 and 2015 Touring family vehicles (see drawing #1 above) may not adequately secure the saddlebag to the motorcycle during use.  If this condition remains undetected, the saddlebag may become separated from the motorcycle while it is in motion, possibly creating a hazard for other motorists including your riding buddy’s in formation behind that “separated” bag.

If this happens there is a good chance you’ll be picking up a new “road rash” painted saddlebag and dirty laundry strewn across the roadway!

UPDATED: July 23, 2015 (1:40pm PDT) — the recall effects 185,000 motorcycles which covers certain 2014 and 2015 Road King, Street Glide, Electra Glide Ultra Classic, Ultra Limited, Police Road King, Police Electra Glide and CVO Ultra Limited bikes. Also affected are 2014 CVO Road King and the 2015 Electra Glide Ultra Classic Low, Ultra Limited Low, Road Glide, CVO Street Glide and CVO Road Glide Ultra motorcycles. No injuries or crashes have been reported due to the saddlebag issues and no information has been provided on the number of “separated” bags.

UPDATED: July 29, 2015 — Polaris introduces its 2016 line up which includes the Victory Empulse TT ($19,999), an electric model which rolls out way ahead of H-D’s LiveWire.  It’s based on the Brammo Empulse R motorcycle produced by the electric motorcycle division of Brammo Inc., which was acquired by Polaris earlier this year.

Photo courtesy of H-D.

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Harley-Davidson Q2 2015 Earnings

I’ll get right to the point.  Motorcycle sales down.  Revenues down.  Earnings down. Currency issues.  Tough competition.

The company’s Q2 earnings were hard to sugar coat for Matt Levatich, President and CEO.  But he sure tried.

“Our actions during the quarter have had a positive impact. We are encouraged by the momentum at retail as the quarter progressed, both in the U.S. and internationally.”  “We are confident in the strength of our business and the strategies we have in place to maintain our industry leadership and grow our business over the long term,” said Levatich. “Our singular focus on the customer through unrivaled products, unique experiences and our expanding dealer network is the bedrock we are building on to continue to grow our reach and impact with customers across the globe.”

Dealers worldwide sold 88,931 new motorcycles in Q2 2015 compared to 90,218 motorcycles in the year-ago quarter. In the U.S., dealers sold 57,790 new motorcycles in the quarter compared to sales of 58,225 motorcycles in the year-ago period.  In international markets, dealers sold 31,141 new motorcycles during the quarter compared to 31,993 motorcycles in the year-ago period, with sales up 16.6 percent in the Asia Pacific region and down 8.9 percent in the EMEA region, 2.6 percent in the Latin America region and 9.9 percent in Canada.

Second-quarter revenue from motorcycles decreased 11.6 percent to $1.31 billion compared to revenue of $1.48 billion in the year-ago period. Following the company’s decision in April to lower motorcycle shipments, the motor company shipped 85,172 motorcycles to dealers and distributors worldwide during the quarter compared to shipments of 92,217 motorcycles in the year-ago period.

Revenue from motorcycle parts and accessories was $256.8 million during the quarter, down 5.4 percent, and revenue from general merchandise, which includes MotorClothes apparel and accessories, was $77.5 million, up 1.5 percent compared to the year-ago period.

As the new CEO, this is Mr. Levatich’s first solo “ride” on an earnings report after Keith Wandell retired.   You have to give the company cred for its integrity of not over producing its motorcycles, but employees and shareholders can’t be happy with these sales.

Full disclosure:  I have no positions in HOG stocks and no plans to initiate any position within the next 72 hours.  I wrote this article from publically accessible information and expresses my own opinion.  I am not receiving compensation for it and have no business relationship with the company.  I currently own a Harley-Davidson Road Glide.

Photo courtesy of H-D.

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Harley-Davidson Earnings Report: Q4 2014

2015 Road Glide

Harley-Davidson (NYSE: HOG) released its Q4’14 financial report along with full-year results.  The motor company reported a drop in net income for the final quarter, but overall profits were up for the year.

Celebrating its 112th year, Harley-Davidson shipped 270,726 motorcycles around the world in 2014.  The Road Glide had a big comeback and sales have been robust and represented about 14% of total U.S. retail sales in the fourth quarter.

For the full year 2014, the Company shipped 270,726 motorcycles to dealers and distributors, a 3.9 percent increase compared to 2013 and in line with guidance. Full-year revenue from motorcycles was $4.39 billion compared to $4.07 billion in the year-ago period. Revenue from parts and accessories was $875.0 million compared to $873.1 million in 2013.  Consolidated revenue topped the $6 billion mark for the first time since 2006.

In 2014, international sales of new Harley-Davidson’s grew at more than 5% and accounted for more than 36% of total retail Harley-Davidson  motorcycle sales which is up from 30% in 2008.

You can read the full financial press release HERE.

Photo courtesy of H-D.

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Harley-Davidson Up On Blocks – Again

Quality control issues in 2014 seem to bedevil Harley-Davidson.

The latest examples are the recalls of 4,688 model year 2014-2015 FLS Softail motorcycles manufactured March 25, 2013, to October 2, 2014 for a lamp-outage detection issues and 1,560 of its 2015 Tri-Glide Ultra Classic FLHTCUTG motorcycles due to rear-brake master cylinder issues.

The Softail motorcycles may have been manufactured without lamp-outage detection for the front turn signals and a rider may not be aware that a front turn signal is not working. And without working front turn signals, there is an increased risk of a crash.  Harley-Davidson is notifying owners, and dealers will correct the body control module software, free of charge. The recall began in December 2014.  The Harley-Davidson’s number for this recall is 0618 or NHTSA campaign number: 14V725000.

On the 3-wheel, certain Tri-Glide Ultra Classic motorcycles manufactured from July 14, 2014, through Oct. 15, 2015, could have rear master cylinder assembled with an incorrect piston.  Harley says this piston may not provide the proper support and may allow a tear in the primary cup. If the primary cup develops a tear it will decrease the brake performance and might increase the risk of a vehicle crash.  Harley-Davidson will notify owners, and dealers will replace the rear master cylinder, free of charge. The recall began December 16, 2014. The Harley-Davidson’s number for this recall is 0162.  Owners may contact Harley-Davidson customer service at 1-800-258-2464 or National Highway Traffic Safety Administration Vehicle Safety Hotline at 1-888-327-4236, or go to www.safercar.gov.

While Harley-Davidsons recalls this year pale in comparison to the massive 300,000 bike recall issued back in 2011, but that was simply a rear brake light problem.

Most of the 2014 Harley-Davidson recalls seem to be centered around rushed product development and/or shoddy workmanship.  That same workmanship issue which has dogged the automakers.  And speaking of, these are the same automakers which just 4-years ago Mr. Keith E. Wandell (Harley-Davidson CEO and President) stated; “Look in a mirror – Harley was already so far down that same (GM) path it wasn’t even funny.”   Basically warning Harley-Davidson employees that it was turning into a GM… and the credibility issue that becomes being associated!

Prior to the above recalls we’ve seen the motor company recall more than 105,000 model 2014 Touring and CVO Touring motorcycles because of a problem with the anti-lock braking system that caused the front wheels to lock up without warning. In August, it recalled over 4,500 bikes for a faulty ignition switch.  It’s also recalling about 1,400 of its 500 and 750 Street bikes from the 2015 model year for a possible fuel tank leak.  I’ve captured the 2014 recalls HERE.

Is Harley-Davidson re-testing the customers reputation of shoddy workmanship (and raising the ghost of Harley’s past)?  It would do well to get a tighter grip on these issues and instill the pride of craftsmanship that should be the motorcycle maker’s hallmark.

Photos courtesy of Harley-Davidson.

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Harley-Davidson Q3’14 Financial Results

2015 Road Glide

Ideas are a dime a dozen.  Execution is everything.

We know that behind the success is a lot of unseen work by the employees and dealers, but is Harley-Davidson ever executing!

Success is hard work and very few want to do the heavy lifting.  Because it’s boring, because its challenging, because no one is paying attention and it might not pay off in the long run.

However, passion and excitement are contagious and leading the Q3’14 financial news announcement is how the new 2015 Road Glide models were the best-selling 2015 Harleys!  The Road Glide was the highest selling model from the new line-up, yet only constituted 4% of the net retail sales this quarter, down from 8% in Q3 2013. This was because the model was only available since the latter part of the quarter, and is now expected to spur domestic sales in Q4.

2015 CVO Street Glide

Sure there was continued strong demand for Street Glides and Ultras, which contributed to the strong sales and the new Rushmore models including the CVO Street Glide, the Electra Glide Ultra, Classic Low and Ultra Limited Low and the Freewheeler, a trike all contributed.

Retail sales at dealers in the US, which account for two-thirds of Harley-Davidson’s business, jumped 3.4 percent in the third quarter as domestic dealers rolled out 50,167 new motorcycles onto the highways.  Keep in mind that motorcycle sales rose this quarter despite a tough comparison with last year’s huge launch of Project Rushmore touring bikes, which had fueled a U.S. sales surge of more than 20 percent.

The stiffer competition from Indian didn’t seem to materialize, but there was a profit hit from an unprecedented number of motorcycle recalls, which cost the company $14 million in the quarter or approximately $0.04 on EPS.

Here are some of the financial stats for Q3’14:

• There are now more than 1,450 H-D dealers in 90 countries
• U.S. market segment share (MSS) was flat at 56.3%
• Harley reported that net income for Q3’14 was $150.1 Million, or 69 cents per share, a decrease of about 8 percent compared with $162.7 Million, or 73 cents per share, in the same period a year ago.  The company cut shipments to dealers who had been saddled with inventory after a slow Q2.
• Revenue for Q3’14 was $1.3 Billion, down from $1.34 Billion. Supply chain problems with the Street, its newest motorcycle platform, caused the company to delay shipping the motorcycles.
• Harley dealers worldwide sold 73,217 new motorcycles, up from the 70,517 sold in the third quarter of last year.
• Harley expects shipments in the fourth quarter of 2014 to increase by3.5 to 5.5 percent from 2013, which had been a record year for sales.
• 30-day delinquency rate for motorcycle loans was 3.0% vs. 3.11% in 2013.

Congrats to everyone at H-D on the great execution in the quarter!

Photo courtesy of H-D.  Full disclosure:  The author does not own HOG stock or have a financial vested interest in the company.

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Harley-Davidson Recalls All 2014 Touring Models

Harley-Davidson is recalling more than 105,000 motorcycles from the 2014 model year because their clutches may fail, causing stopped bikes to creep forward and potentially crash.  The motor company said it will rebuild clutch master cylinders for motorcycles impacted by the recall.

The company knows of 19 low-speed tip-over crashes tied to the problem, with three minor injuries reported. Bikes named in that recall include the Electra Glide Ultra Classic and the CVO Road King.

The NHTSA recall details follow:

NHTSA Campaign #: 14V537000
Potential Number of Units Affected: 105,746
Vehicle Make | Model | Model Year(s)

• H-D FLHRSE 2014
• H-D FLHTCU 2014
• H-D FLHTCUTC 2014
• H-D FLHTCUTG 2014
• H-D FLHTK 2014
• H-D FLHTKSE 2014
• H-D FLHTKSHRINE 2014
• H-D FLHTP 2014
• H-D FLHX 2014
• H-D FLHXS 2014
• H-D FLHXSHRINE 2014
• H-D FLSTNSE 2014
• H-D FXSBSE 2014

SUMMARY:
Harley-Davidson Motor Company (Harley-Davidson) is recalling certain model year 2014 Electra Glide Ultra Classic (FLHTCU), Ultra Limited (FLHTK), Police Electra Glide (FLHTP), Street Glide Special (FLHXS), Street Glide (FLHX), Tri Glide Ultra (FLHTCUTG), CVO Limited (FLHTKSE), CVO Road King (FLHRSE), CVO Breakout (FXSBSE), Electra Glide Ultra Classic Twin Cooled (FLHTCUTC), Ultra Limited Shrine (FLHTK SHRINE), Street Glide Shrine (FLHX SHRINE), and CVO Softail Deluxe (FLSTNSE). In the affected motorcycles, a component in the clutch master cylinder may fail, reducing the pressure available to keep the clutch disengaged.

CONSEQUENCE:
If the clutch does not remain disengaged, the motorcycle may creep forward while the rider intends to be stopped, increasing the risk of a crash.

REMEDY:
Harley-Davidson will notify owners, and dealers will rebuild the affected clutch master cylinders, free of charge. The recall is expected to begin in September 2014. Owners may contact Harley-Davidson customer service at 1-800-258-2464. Harley-Davidson’s number for this recall is 0159 and 0160.

In addition the motor company is also recalling 1,384 motorcycles made earlier this year to test for possible fuel tank leaks.  The recall is on model year 2015 XG500 and XG750 motorcycles manufactured June 11, 2014, to August 14, 2014.  Dealers will test fuel tanks subject to that recall and replace them for free if any leak from under their caps. No injuries, accidents or fires have been tied to that problem.

Photo courtesy of H-D.

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Harley-Davidson Rolls Out 2015 Models

2015 Freewheeler™ Trike

The wait is over!

According to the Harley-Davidson press release here’s what’s new in 2015:

Freewheeler™ Trike – From its mini ape-hanger handlebar to its bobtail fenders, the Freewheeler trike fuses custom style and easy-handling performance. The all-new rear body shape gives the Freewheeler a low, lean profile.

Braking System for Softail® Models – A new braking system for Softail models delivers improved modulation and responsiveness and decreases hand lever effort by 40 percent. ABS is now standard on all Softail models and optional on the Slim. New front brake components include a rigid four-piston fixed front brake caliper with 34 and 32mm pistons coated to minimize initial displacement, brake pads with high-output friction material, a new master cylinder with a higher mechanical ratio, and a new 300mm front brake rotor. The caliper and master cylinder have been restyled to enhance the looks of each model.

Electra Glide® Ultra Classic® Low / Ultra Limited Low Motorcycles – A package of ergonomic enhancements that offer the lowest seat height and highest rider confidence available in a premium touring bike, combined with a full complement of Project RUSHMORE features and classic Harley-Davidson style.

2015 CVO Street Glide

CVO Street Glide Motorcycle – It’s back!  The CVO Street Glide has a new Boom! Audio system with 600 watts of power streaming through four bi-amped front and rear three-way speakers.  It’s a limited-production bagger to achieve that rolling concert “bubble” with volume and sonic quality that will shock the neighbors. There will be four color options with an intricate paint scheme.

CVO Road Glide Ultra Motorcycle – This was a CVO surprise given the new release of the new 2015 Road Glide and many thought it would be a year before a CVO version would launch.  This a super-premium touring motorcycle with world-class aerodynamics, luxury touring essentials and the performance of a Screamin’® Eagle Twin-Cooled™ Twin Cam 110™ engine.

You might recall that Harley-Davidson previously announced the 2015 Road Glide before Sturgis.  It was also included it as part of this press release:

2015 CVO Road Glide Ultra

Road Glide® Motorcycle – After a model year hiatus, this bagger is back with a new triple vented, frame-mounted fairing, Dual Reflector Daymaker™ LED headlamps and a new handlebar with reduced reach and a new wrist angle for improved ergonomics.

Road Glide Special® Motorcycle – The Road Glide Special is equipped with premium Boom! ™ Box infotainment, upgraded suspension, and Reflex™ linked brakes with an Anti-lock Braking System (ABS).

So what do you think of the new models?

Photos courtesy of H-D

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2015 CVO Road Glide Ultra

2015 Road Glide

At the Harley-Davidson dealer show in Nashville…

Well I’m not, but a dealer contact is and I just received confirmation that Harley-Davidson will announce this new CVO model in the their 2015 line later this week.

Informed sources state the new 2015 models will all launch tomorrow.

We wait with baited breath!

Photo courtesy of H-D

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The 2015 Road Glide Wait Is Over

The 2015 Road Glide

Harley-Davidson officially “revealed” the 2015 Road Glide this morning along with an updated web site with some additional details.

The “reveal” is a peculiar twist given that we’re a few weeks away from the typical new model launch window.  Here is the corporate press release announcing the 2015 Road Glide.  I’m sure it’s just the first stage of a lot of hype and media buzz planned for the traditional post-Sturgis announcements.

Or being a bit skeptical of marketing motives… maybe this H-D reveal is simply a tactic to take away some of the headlines from the 2015 Polaris, Indian and Victory news?

2015 Road Glide Inner Fairing

Back to the Road Glide.

There are two models.  The Road Glide and Road Glide Special.  Both models include the same specifications from Project RUSHMORE that is currently available on 2014 touring models.  There is the air-cooled, high output Twin Cam 103™ with integrated oil cooler mated to a 6-speed cruise drive transmission, the new Reflex anti-lock braking system (ABS) with dynamically, electronically linked brakes for optimum braking in all conditions.  Both Road Glide models include the redesigned saddlebags for a sleeker look and added new latches that you can operate with one hand.

The 2015 Road Glide Fairing

The 2015 Road Glide Special is basically an elevated experience of riding that includes the new Boom Box 6.5 infotainment system which features a 6.5″ full color touch screen display and it can be operated by convenient new hand controls or by voice command.  It also includes display color options: Orange (default), Blue, Brown, Green, Gray, Purple, Red.

There’s a new handlebar on the Road Glide motorcycle for 2015 that makes the riding position more comfortable for a wider range of riders and the hand grips are now 5 1/2″ closer to the rider.  There is also new gauges which has a 10% larger speedometer and tachometer with 68% wider numbers; 28% larger fuel and volt gauges with 30% wider numbers.

Most distinctive is the new triple-vented fairing that opens and closes to equalize pressure in front and behind the windscreen.  Lastly there is the new dual Daymaker LED headlamps providing better nighttime riding visibility.

I’ll be interested to experience how easy it is to reach and adjust the infotainment system.  Previously anyone under 6 feet tall could have an issue reaching up to the radio system.

I’m looking forward to seeing the new 2015 Road Glide at the local dealer.

Note:  If you’re tracking or curious how accurate any of the previous blog posts were:  Road Glide spy photos HERE.  Early 2014 Road Glide speculation HERE and HERE.

Photos courtesy of H-D.

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