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Posts Tagged ‘Road Glide Custom’

Finance-HDThe iconic “I’ll be back” catchphrase made famous by Arnold Schwarzenegger in the 1984 movie “Terminator” can now be used to describe that financially, Harley-Davidson is back! 

There is no getting around it.  Harley-Davidson had an exceptional Q3’13.

There was of course the strong financial performance, the biggest launch of new motorcycle models in the company’s history that resulted in excellent retail sales and who can forget the epic 110th anniversary in Milwaukee.  In the initial 45 days at retail since launch, the Rushmore motorcycles sparked the largest year-over-year new model sales increase in 20 years. Sales were up markedly in both the U.S. and internationally. In fact, it was the best international model year launch ever in terms of initial volume.

H-D have been telling us for quarters that they are laser focused on the international businesses. They are targeting 100-150 international new dealer points through 2014 and, over the last 3+ years, have opened 110 new dealer points, with two-thirds being in emerging markets.

Last week H-D reported Q3 revenue of $1.34B and net income of $162.7 million, or 73 cents per share.  For the motorcycles and related product segment revenue was up 8.4% in the third quarter, including a 10.7% increase in motorcycle revenue largely driven by the strong mix of the touring bikes.  U.S. sales were up 20% from July through September and profit jumped 21%.

During Q3’13, parts and accessories sales were up 7.0%, driven by the success of certain product categories such as LED lighting and audio. General Merchandise was down 12.6% compared to Q3’12 due to what H-D referred to as lapping the strong sell in of 110th anniversary apparel and accessories, which began in Q3 of 2012.

Important to the Road Glide riders is the fact that H-D discontinued the Road Glide Custom and Road Glide Ultra.  Management was quick to point out that these models, represent, on an annual basis, about 4-5% of the overall Touring volume.  In terms of retail sales, H-D had brisk retail sales of the Road Glide in the third quarter.  It will be interesting to see if there is any sales headwind from discontinuing the Road Glide in Q4.

One of the items that jumped out at me is that wholesale and MSRP prices have increased by an average of about 3.5% on the new 2014 models. By region, U.S. prices are up roughly 4.25%; EMEA, up 1.5%; and Asia-Pacific and Latin America, each up about 2.5%.  The significant new “content,” which was added to the 2014 model year motorcycles was expected to increase costs by 2.75%.

H-D did not change the 2013 forecast of motorcycle shipments of 259K-264K.  Poor weather in the U.S. during Q2 was again cited as the primary reason for challenges in hitting the high forecast number.

Photo courtesy of H-D

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Ludacris

When you dine with the devil, bring a long spoon.” — Machiavelli

Having a ‘thug’ like Ludacris anywhere near your marketing campaign may not be a good thing.  Yet, Harley-Davidson has decided having a pitchman who glamorizes a life of guns, violence, drugs and is disrespectful of women is EXACTLY what’s needed to turn around motorcycle sales.

The “hoes in different area codes” rapper has released many songs that convey and represent his morals.  Even President Obama said he wouldn’t let his daughters listen to his rap, but did admit Ludacris was a ‘great businessman’.  Political pandering is not my point here.

Recently H-D collaborated with RIDES Magazine to create custom bikes for recording artists Ludacris and Shawnna.  This promotion was in part to gear up for the release of their album “Battle of the Sexes”, where the artists worked with RIDES and “New York Nick” Genender, shop owner of NYC Choppers, to create bikes that reflect their individual personalities.  There is a behind-the-scenes video of the build HERE and more videos/photos can be viewed at RIDES.  In addition, they’re giving away a motorcycle to one lucky winner: a customized 2010 Harley-Davidson Road Glide Custom, created in part with suggestions by RIDES readers. Learn more about the bike or enter for a chance to win HERE.

Is this a shrewd advertising move to use a pitchman who’s going to draw attention to a community that H-D wants to sell motorcycles to or is this a mistake to promote and associate the H-D trademarks with a person that espouses violence, degrading sex and substance abuse?

Does anyone remember how fast Pepsi pulled the ‘musician’ from its soft-drink advertisements in 2002?

Photo courtesy of H-D and RIDE.

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