CEO’s That Made Harley-Davidson

Recently it was reported that the typical CEO at the biggest U.S. companies received an 8.5 percent raise last year, taking in $11.5 million in salary, stock and other compensation, according to a study by executive data firm Equilar for the Associated Press.

Over the last 5-years, median CEO pay has jumped by 19.6 percent not accounting for inflation.  That’s nearly double the 10.9 percent rise in the typical weekly paycheck for full-time employment across the country.

It could be, but this isn’t a rant about the typical line worker vs. CEO wage-gap.

If we’re being intellectually honest, CEOs today are required to master a broader range of skills than in the past, when top executives might have climbed the ranks with just one discipline. Companies are bigger, more global and increasingly complicated, and there’s accelerating competition in countries such as China, India and Brazil. Executives must also adapt to quicker technological change, including shifts brought on by autonomous driving, electric vehicles and the widening use of mobile devices.  And then there is the Board, and the increasing requirement that CEOs push their stock price ever higher to collect their maximum possible payout.

So, who are those CEOs at Harley-Davidson, that made Harley-Davidson?  Below is a historical snapshot of the motor company leadership:

Jochen Zeitz — Credit: Liam Sharp

Jochen Zeitz — born in Mannheim, Germany, the 57-year old was appointed May 7, 2020 as President and Chief Executive Officer (CEO). Zeitz served as Acting President and CEO since February 2020 when the previous CEO, Matt Levatich resigned. Zeitz also continues to serve as Chairman of the Board.

For more background please see this post.

Prior to being named Chairman, Acting President and CEO in February, Zeitz was a member of the Harley-Davidson Board of Directors since 2007 and established the Company’s Brand and Sustainability Committee. He served as Chairman and CEO of Puma for eighteen years from 1993 to 2011 and was also PUMA’s CFO from 1993 to 2005. Zeitz remained Chairman of Puma after being appointed CEO of the Sport and Lifestyle division at luxury goods company Kering (formerly PPR) from 2011 to 2012. He then served as a director on Kering’s Board of Directors from 2012-2016.

He also sits on the boards of financial services company Cranemere, and the Kenya Wildlife Service, as well as running his own charitable foundation (The Zeitz Foundation) and co-chairing The B Team, a non-profit that he co-founded with Richard Branson in 2012 to promote sustainable business practices. He has won the Financial Times Strategist of the Year award three times, been awarded the German Federal Cross of Merit, and co-authored two books – one of which, a dialogue with Benedictine monk Anselm Grün called The Manager and the Monk: A Discourse on Prayer, Profit and Principles, has been translated into 15 languages.

About fifteen years ago, he started his own business – Segera, a 50,000-acre luxury resort retreat on the Laikipia plateau in Kenya’s central highlands.  In addition, Zeitz launched other projects in Africa: The Zeitz Collection of contemporary art from Africa and its diaspora; the Zeitz Museum of Contemporary Art Africa, a complex of 100 galleries in a 1920s granary in Cape Town converted by Thomas Heatherwick, which houses work from both its own and Zeitz’s collections: and The Long Run, which rates sustainable tourism projects according to Conservation, Community, Culture and Commerce (4Cs).

On a personal level — he divorced his first wife Birgit Jöris in 2012 following an 18-year marriage.  He is currently married to LA-based producer Kate Garwood‚ 41‚ producer of the 2016 movie “Race”‚ about U.S. track star Jesse Owens.  They have two children; 4-year old Jesse, born September 2017 and a three year old. He keeps homes in Switzerland, Santa Fe, Los Angeles, the ranch in Kenya and has property in west London.  One would also assume he now has a home in Milwaukee!  His favorite thing is a Scottish Bailey.

Matthew S. Levatich

Matthew S. Levatich — Resigned on February 28, 2020 after a 26-year career at Harley-Davidson with the last 5-years as CEO.  For more info see this post HERE.

Harley-Davidson promoted Levatich to President/CEO in May 2015 when Keith E. Wandell retired.  Mr. Levatich was named COO during CEO Keith Wandell’s tenure.

Mr. Levatich, joined Harley-Davidson in 1994. Prior to becoming COO in May 2009, he held wide-ranging roles in the U.S. and Europe. Those roles included Vice President and General Manager of Harley-Davidson’s Parts and Accessories business, Vice President of Materials Management, and President and Managing Director of the Company’s former MV Agusta business. In addition to an undergraduate degree in mechanical engineering from Rensselaer Polytechnic Institute, Levatich holds a graduate degree in engineering management and an MBA from Northwestern University. He has served on the board of directors of Emerson, a St. Louis-based global manufacturing and technology company, since 2012.

Mr. Levatich is known as an avid rider and an engineer, that demonstrates a clear vision for the company and talks constantly about focus and alignment and helping the organization remain clear on what it is they’re here to do.  No longer is the motor company the “voice of the executive” rather it’s the “voice of the customer.”

Interestingly, Harley-Davidson has evolved from platform teams. Dyna platform, Softail platform, which was largely modeled like the automotive industry. Each platform team was competing for the next big capital investment so they could say now it’s Dyna’s turn to have a major refresh. Or now it’s Softail’s turn. Or now it’s Touring’s turn.  And that doesn’t exist anymore.

In an interview with Cycle World Mr. Levatich stated: “We’re not really in the business of manufacturing motorcycles. We’re in the business of building customers.”  

Keith Wandell

Keith Wandell —  hired from Johnson Controls to serve as Harley-Davidson President/CEO in 2009 — retired May 1, 2015 — only 6-years later.

Credited for leading Harley-Davidson back to profitability by cutting jobs and making its production more efficient he transformed manufacturing through a restructuring plan that generated more than $300 million in annual savings.

Mr. Wandell cut millions of dollars in costs and eliminated several thousand jobs in the manufacturing plants. He brought a sense of urgency to the company, saying he did not want it to be like General Motors and the auto industry that had fallen into deep trouble.

Under his leadership, Harley made significant gains in reaching new customers through growth in international markets and sales to “outreach” segments in the U.S., including young adults, women, African-Americans and Hispanics.  Mr. Wandell also was credited with stoking excitement for a planned electric bike, called Project LiveWire.

Mr. Wandell has been the Non-Executive Chairman of Dana Incorporated since October 27, 2016 and served as its Interim Chairman from September 9, 2016 to October 27, 2016.

James Ziemer

James Ziemer — served as President/CEO from 2005-2009.  Retired in 2009.  Mr. Ziemer is a native Milwaukeean who grew up in the neighborhood next to Harley-Davidson’s original Milwaukee factory location on the city’s west side.

He started with the motor company in 1969 as a freight elevator operator while attending the University of Wisconsin-Milwaukee. He worked at Harley-Davidson for 40 years.  Upon earning his undergraduate degree in accounting at UWM, he joined the accounting department where he spent the majority of his career. He was named the Company’s Chief Financial Officer in 1990. In 2005, 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 Harley-Davidson.

As a sidebar, also in 2009, eleven years after being bought by Harley-Davidson, Erik Buell leaves the company to establish Erik Buell Racing.

Jeffrey L. Bleustein

Jeffrey L. Bleustein — retired as Chairman of the Board of Harley-Davidson in April 2009.  He was Chairman from December 1998 to April 25, 2009.  Previously, he served as CEO from June 1997 to April 2005.

He served at Brunswick Corp in many capacities and was President of Trihawk, Inc., a subsidiary of Harley-Davidson, 1984 to 1985. Remember Trihawks?

Mr. Bleustein was a technology consultant with American Machine and Foundry Co. (AMF).  In 1969, AMF merged with Harley-Davidson and in 1975, AMF assigned him to help reorganize Harley-Davidson engineering operations.  Led by AMA Hall of Famer Vaughn Beals Jr., and 11 other Harley-Davidson executives (including Willie G. Davidson), Bleustein helped execute an $81.5 million leveraged buyout of the company from AMF on June 16, 1981.

To commemorate the buy-back, approximately two dozen company officers, along with their wives and select motorcycle press, made a cross-country motorcycle trek from the production facilities in York, PA to Harley-Davidson’s main offices on Juneau Avenue in Milwaukee. This 900-mile independence journey was also a ride to support the Muscular Dystrophy Association, now the official charity of Harley Owners Group (HOG). The ride followed a host of ceremonies at York which included the signing of documents that marked the ownership change, and pulling the first “new Harley-Davidson” motorcycle off the assembly line. This 4-day celebration began a new chapter in the company’s “new” future.

Mr. Bleustein was responsible for notable engineering innovations which included the rubber engine mounts, redesign of the V-Twin and introduction of the Kevlar drive belts.

During Mr. Bleustein’s tenure (circa: 1998), Harley-Davidson bought Buell Motorcycle Company and named founder Eric Buell Chairman of Buell Operations. The first Buell’s hit showrooms in late 1999.

Rich Teerlink

Rich Teerlink  — served as Chairman and CEO until 1999 at Harley-Davidson until he retired.  Mr. Teerlink joined Harley-Davidson in August 1981 as CFO where he enjoyed great success over his 18-year career.  He started with the company just two months after the group of 13 Harley-Davidson managers had bought the company from its then parent company, American Machine and Foundry Co. (AMF), in a leveraged buyout.

Mr. Teerlink’s greatest accomplishment was establishing the Harley Owners Group (HOG) in 1983.  Mr. Teerlink joined the Vertex Board in 2002, and while serving on the Vertex Board, he also served on the Boards of Johnson Controls, Snap-on Tools and Quad Graphics.

Mr. Teerlink is also a notable author of More Than a Motorcycle, The Leadership Journey at Harley Davidson book.  Mr. Teerlink retired from the Vertex Board of Directors, effective February 4, 2015.

Mr. Teerlink was inducted to the AMA Motorcycle Museum Hall of Fame in 2015.  Mr. Teerlink was awarded an Honorary Degree, Doctor of Laws from Marquette University on May 22, 2005.

Vaughn L. Beals Jr.

Vaughn L. Beals Jr. — served as CEO of Harley-Davidson from 1981-1989 and as Chairman from 1981-1996.

In June 1981, it was a challenging time as American Machine and Foundry Co. (AMF) wanted to cut and run, but no one wanted to buy a company with a limited line of high-priced, obsolete products and a reputation for unreliability.  Vaughn Beals Jr., and 13-other** Harley-Davidson executives (including Willie G. Davidson), led an $81.5 million leveraged buyout of the company from American Machine and Foundry Co. (AMF).

Mr. Beals previously served as a research engineer for North American Aviation and Cummins Engine Company where he negotiated the purchase of logging equipment manufacturer Formac International as he was a minority owner and CEO.  This proved to be valuable during the AMF Harley-Davidson buyout.  He was named Harley-Davidson CEO after the buy-out option.

In 1982, the motor company won an anti-dumping judgment from the International Trade Commission (ITC). This led then-U.S. President Ronald Reagan to impose additional tariffs on imported heavyweight Japanese models, as allowed by the ITC.  The additional tariffs–45 percent on top of an existing 4.4 percent measure–were meant to decrease gradually over five years, until April 1988.

In June 1986, Harley-Davidson went public with a stock offering to raise capital to help pay off the buy-out option.  This was very successful increasing share price from $11 to $24.  Harley-Davidson  used some of the stock sale revenues to buy Holiday Rambler, a U.S. maker of recreational vehicles, for $150 million.  The Holiday Rambler sale pushed Harley-Davidson into the Fortune 500 category for the first time at number 398.  In March 1987 the company asked the ITC to remove the tariffs imposed on Japanese motorcycle imports a year earlier than scheduled.

Willie G. Davidson, V.P. Styling (Left); Vaughn Beals Jr., CEO and Charles Thompson, President (Right)

Mr. Beals was inducted to the AMA Motorcycle Museum Hall of Fame in 2008.

Charles Thompson — served as President and CEO of the restructured Harley-Davidson after American Machine and Foundry Co. (AMF) buy-out option.

Mr. Thompson was a long-time Harley-Davidson employee, well-liked throughout the motorcycle industry and served as president and CEO of the restructured company until his health failed in 1982.

William Herbert “Bill” Davidson — was president of Harley-Davidson Motorcycles from 1942 to 1971.  He was the son of William A. Davidson who quit his regular paying job with the Milwaukee Road railroad in 1903 to get into the business of making motorcycles.

William Herbert “Bill” Davidson

Bill Davidson, started working on the Harley-Davidson shop floor of the family business in 1928 after attending the University of Wisconsin.  He won the AMA National Enduro Championship in 1930 and when he wasn’t winning motorcycle races, Bill worked his way up through the company, becoming a foreman, manager of many departments, and finally president of Harley-Davidson in 1942.

In 1963, Bill brought in his son William Godfrey Davidson (Willie G.) on to head up the styling department of the company. Willie G. would end up creating some of the company’s more popular designs, including the legendary Low Rider and the Super Glide which was inspired by the ideas of bike customizers.

In 1965 Harley-Davidson went public as the two families decided to give up control and put the company’s shares on the market.

In 1969, Harley-Davidson was bought by American Machine and Foundry Co. (AMF), a leisure equipment manufacturer.  The arrangement proved, at least initially, to be a good one for Harley-Davidson, for it was in the mid-1960s that the company experienced its first real competition after Indian went out of business. The financial resources and stability that AMF was able to provide helped the company battle Japanese motorcycle manufacturers, who had begun exporting their vehicles around the world, placing themselves in direct competition with Harley-Davidson.

Bill stayed on as president under the control of AMF reporting to it’s then current chairman and CEO Rodney C. Gott (Mr. Gott served as AMF president, starting in 1962, and chairman and chief executive, from 1968. He retired in 1978).  Mr. Gott was a Harley-Davidson rider and big motorcycle fan.  As a sidebar: In World War II, Mr. Gott was a decorated veteran who served in Gen. George S. Patton’s Third Army and on the staff of Gen. Lesley James McNair, chief of ground forces, and was also commander of the 79th Infantry Division Artillery.

In 1971, Bill Davidson was made Harley-Davidson chairman, but reported that he had little power while under AMF’s control.  It was noted that he was chairman of the Harley-Davidson board that never met.  Conflicts with AMF’s strategy and chaotic market conditions led to Bill Davidson’s resignation in 1973.

It was a period of high CEO turnover at Harley-Davidson.  During this time, AMF named John O’Brian and then Gus Davis as president, marking the first time someone other than a Davidson would sit in the company presidents chair.  Other Harley and Davidson family members continued on at the company under AMF’s ownership.  Bill Davidson’s son John was vice president of Sales, and then moved up to become president after Gus Davis.  William J. Harley was engineering vice president until his death in 1971.  His brother John Harley remained at the company until his death in 1976 as the last Harley at Harley-Davidson.

In 1975, AMF put Vaughn Beals Jr. at the head of Harley-Davidson, and Jeff Bleustein was named chief engineer. Bleustein was charged with making manufacturing improvements, which had  become increasingly necessary as production grew and quality declined.  A limited line of high-priced products and a reputation for unreliable motorcycles marked this timeframe in history.  AMF began to lose interest in keeping the struggling motorcycle business afloat.

Rodney C. Gott (Left) and John Davidson, President Harley-Davidson

In a bit of irony, (circa: 09/1977), the motor company unveiled a motorcycle museum in York, PA., that was named after AMF’s CEO — Rodney C. Gott Motorcycle Museum.  A video HERE.

In June 1981, to save the company, and to effect a turnaround, thirteen Harley-Davidson executives, led by Vaughn Beals Jr., put together a plan for a leveraged management buyout. With the financial support of Citicorp, the management team succeeded in taking control of Harley-Davidson from AMF on June 16, 1981, at a cost of $81.5 million.

The role of the new officers after the company buy-out option included: Charles Thompson, president and chief operating officer; Jack Hamilton, Chris Sartalis, Jim Paterson, Kurt Woerpel, Peter Profumo, Jeffrey Bleustein, Thomas Gelb, William Davidson, and Tim Hoelter, all vice presidents. The president of the various divisions were: John Davidson, golf; David Caruso, parts and accessories; Ralph Swenson, York; and David Lickerman, Harley-Davidson International.

Even though he was no longer actively involved with the company, Bill Davidson lived to see the renewal and success that Harley-Davidson enjoyed starting in the late-1980s.

Bill Davidson died in 1993.  He was inducted into the AMA Motorcycle Museum Hall of Fame in 1999.

Walter Davidson — was president from 1907 to 1942.  Bill Harley was chief engineer and treasurer. Author Davidson is secretary and general sales manager and William A. Davidson is the works manager.

In 1936, six sons of the founders are working at Harley-Davidson.  Walter Davidson’s sons Gordon and Walter C.; and William Davidson’s sons, William Herbert “Bill” and Allan; and Bill Harley’s sons, William J. and John.

In 1942 from his death bed,  Walter Davidson named his nephew William Herbert “Bill” Davidson as president and his own eldest son Gordon, as vice president of manufacturing.

Historical Principal H-D Subsidiaries: Holiday Rambler Corporation; Utilmaster Corporation; B&B Molders; Creative Dimensions; Nappanee Wood Products.

Article References:

Vaughn Beals Jr. – Wikipedia

Growing Up Harley-Davidson – Jean Davidson

Harvard Business Review – Harley Leadership U-Turn
Jeffrey Bleustein – Wikipedia

The Morning Call – Harley Is A Classic Turnaround Story

Rodney C. Gott Obituary
Gus Davis Obituary

Cycle World Magazine – Interview with CEO, Matthew S. Levatich

Cycle World Magazine – Rodney C. Gott Motorcycle Museum

Chicago Tribune – The Real Harley-Davidson Story

James Ziemer – Northwest Harley Blog

People – Buy Back Article

Rick Barrett – Journal Sentinel

Richard Benson – Wired UK

Harley-Davidson (Buyout) Management Team

**The Harley-Davidson managers post buy-out option: left to right standing: John Hamilton, Dr. Jeffrey Bleustein, Kurt Woerpel, Chstopher Sartalis, and William G. Davidson.  Left to right, seated: James Peterson, Timothy Hoelter, David Lickerman, Peter Profumo, David Caruso, Ralph Swenson, Charles Thompson, and Vaughn Beals Jr.

 

Photos courtesy of Harley-Davidson

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Harley-Davidson Makes Changes At The Top

Matthew (Matt) S. Levatich

Harley-Davidson announced that the current CEO of Harley-Davidson, Keith Wandell (age 65) is retiring after taking over the position back in May 2009.  Matthew S. Levatich (age 50), who has served as the President and Chief Operating Officer since May 2009 is scheduled to take over as the next CEO on May 1, 2015.

Mr. Levatich served as President and Managing Director of MV Agusta, a former subsidiary of the Company. In his 15 years at Harley-Davidson, Matt has held positions of increasing responsibility in the U.S. and Europe. He served as General Manager of Parts & Accessories and Custom Vehicle Operations and Vice President of Materials Management.

Matt joined Harley-Davidson in 1994 through its Leadership Development Program and serves on the executive advisory board of the MMM Program at the J.L. Kellogg Graduate School of Management and Robert R. McCormick School of Engineering and Applied Sciences at Northwestern University.  He is a trustee on the Milwaukee Institute of Art and Design and a Regent at the Milwaukee School of Engineering (MSOE). Mr. Levatich holds an Undergraduate Degree in Mechanical Engineering from Rensselaer Polytechnic Institute. He holds ME in Engineering Management and MBA in Marketing, Finance and Organizational Behavior from Northwestern University.

Matt will take the helm of the company at a much better stage than it was during the tenure of Wandell where coincidentally, Harley-Davidson has reported consecutive profits for six years in tandem, which shows how key the effects of Wandell were on the company.

Congrats are in order.  There are challenges ahead which need to be overcome by the company as a whole and it will be interesting to watch advances in the pipeline made by Mr. Levatich.

Photo courtesy of H-D.

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Road Glide Absence Impacts Q4 2013 Financials

2013 Harley-Davidson Road Glide

Harley-Davidson Inc. reported it’s Q4’13 financials today posting a 9.7% year-over-year rise in earnings to 34 cents per share from 31 cents in the year-ago quarter.  The year-over-year increase was due to higher revenues and lower operating expenses in the Motorcycles segment.

Revenues improved 1.7% to $1.19 billion and operating income rose 5.1% to $122 million from $116.1 million in the fourth quarter of 2012.  Net income increased 6.8% to $75.4 million from $70.6 million a year ago.

For the 2013 full year results revenues increased 5.7% to $5.9 billion from $5.58 billion in 2012 and net income increased to $734 million from $623.9 million a year ago.

Harley-Davidson shipped 46,618 motorcycles to dealers and distributors worldwide during the 4th quarter which was down 0.95% from 47,067 motorcycles in the fourth quarter of 2012.   In the U.S., shipments improved 6.3% from the year-ago quarter to 27,387 units and commands roughly 50% share of the U.S. market,

Keith Wandell, chairman, president and chief executive officer of Harley-Davidson called the year “outstanding.”

So were there any other highlights?

Well yes… John A. Olin – Chief Financial Officer and Senior Vice President stated, “As we anticipated, U.S. retail sales growth in the fourth quarter slowed from the third quarter’s growth rate, behind 2 key drivers…”   “The second was the impact of the absence of the popular Road Glide models in the 2014 model year.  When you look at Q4 of 2012, the Road Glide represented 9% of that volume, and that Road Glide customers are incredibly loyal to that motorcycle. And that’s probably the biggest impact that we had on our 2013 retail sales in the fourth quarter.”

Mr. Olin also talked about a “fatten the tail” strategy.

Huh?

I’m not 100% sure of the context, but simply put, a financial fat tail describes a rare and extreme event.  On one end of the spectrum, are products like Project RUSHMORE that encourage trade-up at a high revenue and at a very high margin, and typically are aimed at H-D’s core customer. But, Rushmore is selling extremely well with outreach customers. And in addition, the Street Glide is the #1 selling bike to women, young adults, African-American and Hispanic’s.

Suffice to say that the Road Glide was a huge part of H-D sales and it’s no longer there.  Yet, the quarter was great!  Congrats to the H-D team.

Photo courtesy of The Bike Exchange

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Harley-Davidson And The “The King of Good Times”

I’m talking about Kingfisher.

Beer was introduced into India by the British, who eventually set up a brewery that produced Asia’s first beer — a pale ale called Lion. However, these days, lager is the only type of beer you’ll find available in India and “The King of Good Times” is Kingfisher.

It’s India’s most recognized and widely available beer. Its name has been associated with sports, fashion, and even an airline.

And sooner than anyone would have thought… in Bawal, India a Harley-Davidson assembly line worker will be having a Kingfisher and relaxing with co-workers.

But, I’ve gotten ahead of myself…  let’s jump into the the way back machine and set the dial for — 2009.

“The fact is we must focus both our effort and our investment on the Harley-Davidson brand, as we believe this provides an optimal path to sustained, meaningful long-term growth,” said CEO Keith Wandell at the October 15, 2009 announcement to discontinue production of Buell motorcycles.  On October 30, 2009 the last Buell (Lightning XB12Scg) rolled off the company’s East Troy, Wisconsin. assembly line.  It was the last of the 136,923 motorcycles built in the company’s 26 years of operation.

Harley-Davidson Street 750

It was a combination of factors in making the decision, but essentially the global recession forced a reckoning and Harley-Davidson decided to refocus on its tent pole products or what I’d call doubling down on its core lineup of heavyweight bikes.  As a result, the motor company abandoned entry level motorcycles (Buell Blast), exited the sport bike (Buell and sold MV) and thumb their noses at the adventure market (Buell Ulysses).   In the process the motor company made a lot of motorcycle enthusiasts upset about what looked like a myopic approach of only looking at spreadsheets versus doing a bit more market research and addressing a need.

Jump ahead 4-years and witness the financial rebound of the company and the launch this week of the new Harley-Davidson Street 750 and Street 500 motorcycles.  Could it be a Buell Blast ReDeux?  The smaller 500cc motorcycle basically fills a void left when they discontinued the Buell motorcycle line which included the 492cc Buell Blast.  More important in this announcement is the fact that the motorcycles will be made both in the U.S. and Bawal, India, marking the first time the company will manufacture a complete motorcycle at an overseas facility.  I’ll repeat that… the first time the company will manufacture a complete motorcycle outside the U.S.!

Harley-Davidson Street 750 (Side View)

The manufacturing news in of itself will be fodder for many future blog posts, but sticking to the motorcycle announcement, the new ‘Street’ bikes are the first Harley-Davidson motorcycles to be designed from scratch since the V-Rod 13 years ago.

It makes this Road Glide owner wonder if that’s an indicator of where all the engineers were redirected in lieu of updating the ‘Glide’ with the all new Project RUSHMORE features that were incorporated into the new 2014 touring models?

The fact is the company has aggressively expanded its marketing efforts because realistically, there is no replacing white Baby Boomer men. And this means they have to attract younger men, non-Caucasian men, women, and do that from countries as disparate as India, Italy, Brazil and the U.S. with much more success.  By turning inwards, relying on a single-brand tradition and nationalism over the last 4-years and divesting itself of brands that were dimming the lights on a brighter future–the motor company can and now has expanded into other segments.

At the Street 750/500 announcement the Harley-Davidson, CEO Keith Wandell said, “The younger riders don’t want their dad’s chromed-out Harley,” “They want the Dark Custom, sinister look, the ability to rebel.”

Sounds like a bit of marketing spin, but with more than half of its dealerships outside the U.S., Harley-Davidson has really put a lot of investment behind a push to expand and broaden its customer base including new motorcycle buyers–worldwide.

Photo’s courtesy of H-D and Kingfisher.  Note: Kingfisher, “The King of Good Times”, is India’s most recognized and widely available beer. Its name has been associated with sports, fashion, and even an airline.

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Harley-Davidson CEO And CFO Sell Stock After Indian Launch

Coincidence? 

On Friday, August 9th, three days after the Indian launch, the Harley-Davidson Chief Financial Officer, John Olin sold 11,104 shares of HOG stock.  The stock was sold at an average price of $59.00, for a total transaction of $655,136.00. Following the transaction, the CFO now directly owns 12,702 shares in the company. The sale was disclosed in a filing with the Securities & Exchange Commission, at this link.

Just a couple of days later Harley-Davidson CEO, Keith Wandell sold 77,102 shares of the stock in a transaction dated Tuesday, August 13th. The shares were sold at an average price of $58.82, for a total transaction of $4,535,139.64. Following the sale, Mr. Wandell now directly owns 70,545 shares in the company.  Those stock options must be working out for him as he now owns three motorcycles; a Street Glide CVO 2011; Road King Classic; and Dyna Wide Glide. 

Well-heeled Riders

As is often the situation with an executive selling  stock it was likely in the pipeline for weeks prior to the actual sale.

But, after the Great Recession began, the lingering impact of the worst downturn in a half-century continues to deplete the standard of living on the middle-class American household.  Let’s face it, the big factor in the market for anything expensive nowadays is that the only people who have disposable income are the super-rich… and THEY have more of it than anyone has ever had in all of human history.

Sure it’s become trite to slam the rich and I’m trying not to be repetitive.

But, it’s not about being ostentatious:  the super-rich don’t care about impressing the rest of us, because they never see us. They glide from the gated community to the private jet to the island vacation home without encountering any “downscalers.”  They mix exclusively with the other super-rich, and those are the only people they care about impressing.

And that’s tough, because when you’ve got enough money to buy about anything that’s ever been made without a second thought, you have to realize that the guy living next door to your McMansion can buy it too.  So, you’ve just ordered a one-off custom color CVO with a turquoise ostrich-skin seat with matching hand-made gloves and boots?  He’ll give it a glance and say, “Not bad. I think I’ll get a couple for my kids to use when they’re home from prep school.”

So, if really you want to one-up your neighbors by owning something they can’t, your choices are restricted to items with a built-in limited supply, such as art works, and a U.S. Congressmen. Or in keeping with a narrower interpretation of that custom motorcycle style genre, just minimize the amount of tchotchkes on that bone stock H-D motorcycle.

Simple is the new chrome and when your well-heeled fellow riders guffaw, you just have to learn to smirk in a superior way and say, “I guess you don’t grasp the irony…”

Photos courtesy of Indian Motorcycle and Flickr.

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Harley-Davidson Brand Ranking Improves

2012 Interbrand Top 100 — Harley-Davidson #96

Maybe it was the Willie G. retirement?   Or it could have been a result of Mark Hans Richer (H-D CMO) flexing marketing muscles on the urban scene.

It might be that after nearly three years of downsizing, plant closures and restructuring its business, Harley-Davidson is firing on both cylinders and there is a lot less heat buildup due to the “synthetic lube” of Keith Wandell’s (H-D CEO) new break-in procedure?  Whatever the case, it has emerged with an improvement in brand value.

This according to Interbrand who recently released the 2012 Best Global Brands.  In 2010, the H-D brand was 100 on the top 100 list.  In 2011 it improved to 98th and for this year it again improved its ranking to 96th.

How does Interbrand choose which brands it considers best?

The research firm uses three factors: 1) the financial performance of the branded product or service; 2) the role the brand plays in influencing consumers; and 3) the strength of the brand in asking a premium price for its products or bringing in earnings for the company.

“Stereo Typical” Harley Ad

The restructure strategies seems to be paying off with signs of solid performance and consistent growth. Sure there are significant “head winds”…  meaning challenging economic times and the motor company knows that it cannot solely rely on baby boomers, and needs to appeal to women, minorities, Gen Y, and Millennials.

HERE is an example of that new outreach (#stereotypicalharley).  Or the remix version HERE.

The management at Harley-Davidson want customers to “feel a certain way” when using their products, visiting a dealer, or surfing on the H-D Web site.  They know that a brand connects a business with the hearts and minds of consumers.

Photo courtesy of Interbrands and H-D.

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110th Anniversary Harley-Davidson Models Announced

110th Anniversary Logo

Well not officially, but according to this site, they’ve obtained a double top secret (read: “leaked”) list of the new Harley-Davidson 2013 model lineup.

No sources were provided, no color schemes or was there any validation via a photo or a scanned copy of the leaked list provided so take all this with a grain of salt.

Motorcycle enthusiasts are well aware that 2013 is the 110th Anniversary for the motor company and similar to the 100th and 95th anniversary celebrations there were a lot of special color combinations and special badging on a broad range of models so we can expect the same for 2013.

For 2013 in the top-of-the-line CVO’s, there will be the CVO Road Glide Custom Anniversary Edition, the CVO Road King, the CVO Road King Anniversary Edition and the CVO Ultra Classic Electra Glide Anniversary Edition. The 2012 CVO Softtail Convertible and CVO Street Glide are dropped.

That last one means the price just went up for any stragglers in the dealer showroom floors on this year’s 8-speaker, 1000 Watt, aural bubble machines, i.e., the CVO Street Glide!

Moving down from the CVOs there’s the new 2013 Road King Anniversary Edition and for “trike” crowd there will even be a three wheel Tri Glide Anniversary Edition.

On the Sportster line-up, there is the Sportster 1200 Custom Anniversary Edition, and the Nightster is being dropped.  On the Dyna and Softail lines there’s the new Fat Boy Special Anniversary Edition, Heritage Softail Classic Anniversary Edition and Super Glide Custom Anniversary Edition.  According to the report the “Anniversary Edition” means black paint and some special badges.

In related news, on Monday (June 25th) the Harley-Davidson CEO, Keith Wandell and members of his management team will be in New York to ring the closing bell at the NYSE commemorating the company’s 25th anniversary on the exchange.  It wouldn’t be unheard of them to take Experience Square and transform it into a mini-showroom and have some 2013 models on display.

When I get more information I’ll update this post.

UPDATE: September 9, 2012 – An updated post on the 110th models is HERE.

Photo courtesy of H-D.

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Harley-Davidson Q1 Financial Report

By now you’ve likely read the Q1’12 financial report about how Harley-Davidson Inc. blew away the key financial metrics for the quarter.

You know – Financial Reports – the documents and records pulled together by the motor company to track and review how much money the business is making (or not) with the purpose to update the lenders and shareholders.  These reports are not very friendly or helpful explanations.  More often they require an accounting degree because of the use of financial derivatives, contracts and instruments.

At any rate, not only did H-D report strong gains in earnings for the first quarter of 2012, but motorcycle and related products revenue for the quarter jumped to $1.27 billion, compared with $1.06 billion for the year-ago period.  Consolidated revenue for the quarter, which includes revenue from H-D’s financial services unit, rose to $1.43 billion for the quarter, compared with $1.22 billion in the year-ago quarter.  Most important was the fact that retail sales of new motorcycles grew 20.3 percent worldwide in the quarter compared with the prior-year period and it was led by a strong 25.5 percent increase in the U.S.

Is Harley-Davidson becoming cool to work for again?

It’s a big place and I’m sure some would say yes its cool.  However, what they’ve been through the last couple years has been painful and the process of getting rid of a lot of old bad habits has some maybe thinking no.  The Harley-Davidson chairman, president and CEO, Keith Wandell’s willingness to take on the risks took a lot of courage and it now seems to be paying off.

In other words, it takes 10,000 hours to become world class.  This is a key point in Malcolm Gladwell’s book called “Outliers” which has popularized the theory of 10,000 hours to excellence.  Clearly Mr. Wandell has put in his 10,000 hours, but that doesn’t mean anyone will notice.  Many will just shrug their shoulders at his accomplishments, or they might not even care.

I’ve taken notice and wonder if Harley-Davidson is ahead of its time or is the outlook less optimistic because they’re very good at setting targets that they are confident of being able to hit?

I would suggest that their success this quarter has been largely dependent on “baggers” and the discretionary spending situation improving versus bold new designs.  Meaning the whole motorcycle industry is running on conventional wisdom. People keep doing it the way everybody else is doing it, not expecting a different result so much as being desirous of converting people over to their brand or getting the few remaining conventional buyers left in the business.

You might disagree, but from my vantage Harley-Davidson hasn’t busted out a new “hit” (model) with worldwide success in long time despite the daily onslaught of promotions and publicity.  I’m talking about a stand in the line type of hit!  The conventional orthodoxy of the motorcycle industry is that H-D’s are styled conservatively.  This is typical market research talking.  It’s conventional wisdom saying don’t take a risk on design.  Just accept safe.  A blacked-out bolt here and a new red glitter color there.

Independent of this most recent financial report, the issue is that “safe” doesn’t consistently move the needle in terms of sales.

John Krafcik, President and CEO of Hyundai Motor America

If that were true then Hyundai sales wouldn’t be burgeoning or would they be the most feared major car company in the U.S.  Do you remember when Hyundai’s used to be a joke? Jay Leno said you could double a Hyundai’s value by filling it up with gas.  No one’s laughing now as Hyundai’s John Krafcik steered it from joke to contender. It took a risk.

So, when will we see some of that product “risk” that Harley-Davidson refers to in the quarterly financial reports?  Or has it all come down to being safe and going after the number of “likes” on social networking sites?  Hey, Harley… 1999 called and said they want the true-to-self artistry back!  We can smell the hype.  We know when you’re working it.  What’s sup with all the emphasis on tweeting and hyper-vomiting facebook “fans” over everyone’s networking profiles.  It all adds to the dissonant fray of self promotion and it’s hard to hear when everyone is yelling.

If you have a hot product, people want it.  We know when something impacts us, when we believe it’s great.  And when we find something good, we want to get closer, we want to tell everybody we know.  You don’t have to tweet, you don’t have to Facebook, you don’t even need a website. But it’s got to be different, it’s got to challenge conventional wisdom, it’s got to appeal to people’s hearts more than their pocket books.

Harley-Davidson is at a point where they can make the transformation from the perennial also-ran to a motorcycle industry jauggernaut that pushes the envelope in its designs while other companies try to catch up.  Or the Hyundai equivalent will…

Photos courtesy of H-D and Richard Drew/AP.

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Harley-Davidson CEO Looses Friendly Wager

It’s unlikely that you are aware of this, but prior to the New Years holiday I sent a friendly email to Harley-Davidson’s CEO, Keith Wandell and challenged him to a little competition.

We know that Mr. Wandell likes to golf, but it wasn’t like that “caddy” and “wager” from the scene in Caddyshack… “Five bucks says the kid picks his nose…” nor was it like The Office episode where everyone at the Scranton branch were making bets, one of which was to switch Creed’s apple for a potato and see if he would know the difference.  While that’d be funny I’m sure that Mark-Hans Richer would quickly notice.

Truth be told I suggested a friendly wager for Monday’s Rose Bowl between the Oregon Ducks and Wisconsin Badgers.

In the personal message I stated that if the Badgers lose Mr. Wandell would pull together a care package of Leinenkugel’s beer, Wisconsin cheese, and a package of Andes mints.  Maybe even throw in a discount coupon for some Harley chrome with a personalized note.  Should the Ducks lose, I would send him an Oregon nut— I know what you’re thinking— Hazelnuts and a dead fish (smoked king salmon) to his office in Wisconsin.  I was also willing to throw in a promise of writing only “you done good” blogs about the motor company for a full month.

Must I remind that the Ducks won the game?!

You might want to re-check your email SPAM folder and unblock Northwest Harley Blog email.  I’m sure I sent it.  You know where to get in touch, Keith.  Here’s a cheer in advance of receiving the Leinenkugel refreshments!

Photo created by author at Opuscreative.com

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Keith Wandell Plays Wizard

Keith Wandell doing The Street Interview

Haven’t you heard? The CEO of Harley-Davidson, Keith Wandell has decided to take time off from the company in order to pursue his dream of playing keyboard in a band named “Wizard.”

Just kidding—unless you’ve been hiding under a rock, you probably already know what Keith is up to this week.  He’s coming off a “Booyah” financial quarter where by every financial measure the company has generated improvements.

I ran across this video where Mr. Wandell does an interview with The Street reporter Debra Borchardt.   He’s in the press “hot seat” and provided some insights into H-D’s relative success in the 1H 2011.  The Street — is a leading provider of financial news, commentary, analysis, ratings, and business and investment content, made available through online publications, content syndication and audio and video programming.

Side Bar: Mr. Wandell has come a long way from the initial days of not owning or riding a motorcycle to where today he owns three!  He rides a Street Glide CVO 2011; Road King Classic; and Dyna Wide Glide.  That H-D employee discount must be working out for him.

The bottom line of the interview is Harley-Davidson is rockin’ with Mr. Wandell!

Photo courtesy of The Street.

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