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Wednesday, 26 July 2017


More lay-offs loom at Harley as second quarter domestic U.S. sales plummet ahead of significant peak season market decline

The shocking headline news is that Harley-Davidson’s second quarter domestic U.S. sales were down a massive -9.3 percent compared to the second quarter of 2016, a result that is way worse than the one they were expecting in a peak selling season where total domestic U.S. new motorcycle sales were down by around 7 percent for the quarter.

This puts Harley’s domestic sales down by - 7.9 percent for the first half of the year and leaves their domestic market share in the 601+cc category at 48.5 percent for the second quarter (compared to 49.5 percent for Q2 in 2016) and at 49.6 percent for the first half year 2017. The company is citing “weak industry sales on soft used bike process” as among the Q2 impactors.
The company says that dealer inventory is down by approximately 7,200 motorcycles year on year and that it will further cut production with its revised unit shipments now forecast at between 241,000 and 246,000 for the full year 2017, 39,000 to 44,000 of them in Q3 – down by between 10 and 20 percent from Q3 2017. Total second quarter shipments were 81,807 units (down by -7.2 percent on Q2 2016 and are 152,638 for the half year (down by -10.8 percent of the first half of 2016).
Touring model sales were up by +13.4 percent for the quarter, at 44.8 percent of the model mix, and are 43.1 percent of the mix YTD, up by +4.4 percent; their Street/Sportster lines were 24.3 percent of Q2 shipments, but Cruisers, which includes V-Rods and CVOs as well as Softails and Dyna models, were down by -11.8 percent in terms of the overall model mix, at 30.9 percent of the total (33 percent/-4.7 percent YTD).
Originally the company had forecast that 2017 would be “flat to modestly down for them,” but they are now having to accept that the “new normal” Levatich referenced in February means “down double digits” for the year, with massive restructuring of channel inventory levels not just a first quarter fix, as originally suggested.
The cut in production will result in further lay-offs, likely of hourly paid staff, as the company continues to “aggressively manage our cost structure,” CEO Matt Levatich said, in acknowledging the “unexpected magnitude of the industry softening in the second quarter.”

"Harley shares tanked -11 percent"

Managing supply, further reducing costs, and continuing pursuit of their previously announced 10-year strategies, not least the training of 2 million new riders and introduction of 100 new models, are the three pillars of recovery that the Harley ranch is bet on at this time – with much now hinging on market reaction to the new 2018 model year introductions.
CFO John Ollin and CEO Matt Levatich both acknowledged that “our biggest opportunities for growth is outside the United States,” and both have reaffirmed their stated objective of seeing at least 50 percent of sales being made internationally within 10 years, and the recently announced plan to build an assembly plant in Thailand to service the ASEAN region – believed to be a direct response to U.S. withdrawal from the Trans Pacific Partnership (TPP) free trade deal that would have seen tariff barriers reduced; a withdrawal that Levatich is on record as saying “would have helped us a lot.”
Harley’s total worldwide motorcycle retail sales were 81,388 in the second quarter, down by -6.7 percent, with worldwide sales -5.7 percent YTD. Of that 31,720 units were international sales, which is down by -2.3 percent for the second quarter, and are -2.1 percent for the YTD.
Their Europe, Middle East and Africa region was the best performing of their export markets, with sales down by only 1.6 percent for the second quarter and -2.1 percent YTD; their European 601+cc market share was up by 0.2 percent for the second quarter at 10.3 percent, but remains -0.9 percent for the YTD at 9.4 percent.
Harley’s Asia Pacific market was down -3.2 percent (-6.0 percent YTD); Latin America -8.5 percent for Q2 (up by +5.3 percent YTD), with Canada up by 0.4 percent in Q2, but down by -1.5 percent TYD.
Harley added 13 more dealers internationally during the second quarter, and has reconfirmed its intention to grow its international dealer network by between 150 and 200 new outlets between 2016 and 2020.
In the press release that accompanied the release of their results, Matt Levatich is quoted as saying: “We are pleased with our ability to deliver strong margins in the quarter despite challenging market conditions, particularly in the U.S. Given U.S. industry challenges in the second quarter and the importance of the supply and demand balance for our premium brand, we are lowering our full-year shipment and margin guidance.
“Our long-term strategy, focused on building the next generation of Harley-Davidson riders, is our true north. Our new product investment is one pillar of our long-term strategy to build riders globally, and we are energized by the strength of our model year 2018 motorcycles coming later this summer.”
Revenue from the Motorcycles and Related Products segment was down in the second quarter of 2017 versus prior year “largely due to lower motorcycle shipments.” Operating margin as a percent of revenue increased versus the prior year quarter primarily as a result of mix favorability driven by demand for the Milwaukee-Eight powered touring motorcycles and lower SG&A [Selling, general and administrative] spending.
The company says it now expects full year 2017 operating margin to be down approximately 1 percentage point compared to 2016. The company continues to expect 2017 capital expenditures to be $200 million to $220 million.
Shares in Harley-Davidson tanked by nearly 11 percent within an hour of trading opening on the day the second quarter figures were released (July 18) in the heaviest daily trading seen in more than two years. The share price recovered slightly during the day (from a 12-month low), but were left trading some 25 percent lower than their 12-month high of $62.94 in March.

Championship of the Americas

‘Early Bird’ registration benefits at Championship of the Americas

Registration is open for the Championship of the Americas (COTA), North America’s most prestigious bike competition, taking place at AIMExpo presented by Nationwide this September (21 – 24) in Columbus, Ohio. 

Bob Kay, Director of the Custom Culture content of AIMExpo and of COTA, is inviting all builders to embrace the opportunity for profile and business that AIMExpo represents, and to enjoy ‘Early Bird’ benefits by registering now.
First, rooms can be reserved through the AIMExpo website at SUBSTANTIAL savings …
Second, we would like to publish early builder registrations on our website and in the AIMExpo edition of AMD Magazine (the September edition) to help you expand your network and exposure.
Third, because COTA at AIMExpo is the only official affiliate of the AMD World Championship of Custom Bike Building in the Americas, FreeStyle builders can compete for $7,500 in expenses to represent Team America at the AMD World Championship, held at ‘INTERMOT Customized’ during the 2018 INTERMOT in Cologne, Germany. In 2016 the AMD World Championship and ‘INTERMOT Customized’ saw some 150,000 high mileage riders and industry visitors attending the ‘show-within’ show’, likely making it the best attended single custom show in the world.

Fourth, AIMExpo is continually solidifying its position as ‘Go-To’ motorcycle and powersports industry show, creating sponsorship opportunities for all builders of all classes, which simply are not available anywhere else. The motorcycle media will be there in full force including Hot Bike, Street Chopper, Motorcyclist, AMD, Cycle Source, Thunder Roads Ohio, Dealernews and MPN.
For full rules and regulations and your opportunity to register, just visit, click on register and scroll down to Championship of the Americas. If you have a question, just e-mail or give Bob Kay a call on 817-312-0380.
AIMExpo has a unique ‘European expo’ style formula with two days reserved exclusively for builders, dealers and industry visitors (September 21 & 22), followed by a weekend when the show is open to all visitors, including the public, and with a first public opportunity to see the new 2018 Harley-Davidson and Indian Motorcycle models, and as both companies make their AIMExpo debut, we are anticipating a record consumer attendance.

Featured as one of the main focal points of Custom Culture at AIMEXpo, the Championship of the Americas will be complemented by great exhibiting brands located nearby, including S&S Cycle, Andrews Products, TC Bros, Simpson Helmets, Red Line Oil, JRI Shocks, Lethal Threat and AD Farrow Harley-Davidson, to name just a few.
Also joining the list of Custom Culture vendors throughout the show is Barnett Tool & Engineering, Jim’s Machining, RideWright Wheels, Air FX, Hawg Halters, All American Wheel, All Balls Racing, Motion Pro, Race Tech Suspension, Cometic Gaskets, Cramp Buster, Clamp Tite, ASA/Jensen, Arnott Air Suspension, Zan Headgear, Yuasa, Wiseco, Ram Mounts, Odyssey Batteries, Antigravity Lithium Batteries, Handy Industries, Neway Manufacturing, JE Pistons, Vega Helmets, National Cycle, SBS, Millennial Technologies, Koso North America, Kibblewhite, K&N Engineering, Iron Pony, Hot Leathers, Energy Suspension, DNA Specialties, EBC, Spectro Oils and Bell Helmets – with more vendors signing up each week.

Tucker Rocky/Biker’s Choice

Biker’s Choice 2018 Dealer & Brand Expo

Tucker Rocky/Biker’s Choice has announced that it will again stage its ‘Dealer & Brand Expo’ next year, with the event slated for February 8 - 10 at Frisco in Texas (some 25 miles north of Dallas).
After a break, Tucker Rocky/Biker’s Choice brought their annual dealer event back for the first time since the merger with MAG in February this year; the event was well attended and well received and the company had said at the time that it hoped to make it an annual fixture at its new February timing.

Andy Graves, CEO: “Our new look, new format Dealer & Brand Expo has been quite an investment, but the response from our dealers and the results it is generating make it entirely worthwhile”

At the time, MAG/TR CEO Andy Graves told AMD that “our new look, new format Dealer & Brand Expo has been quite an investment, but the response from our dealers and the results it is generating make it entirely worthwhile.

“The new timing is key as it gives our dealers and vendors the opportunity to do business at just the right time. The reaction is entirely positive, so we do expect to hold it again at this time in 2018 and beyond.”

LeMans Corporation

Collins takes the reins at LeMans

Janesville, Wisconsin headquartered LeMans Corporation, the parent company for Parts Unlimited, Drag Specialties and well-known brands such as Thor, ICON and Moose, has announced that Mike Collins has been appointed as President/CEO.

Mike Collins, President/CEO of LeMans Corporation

Mike has been with LeMans for 24 years, most recently as Vice President Purchasing. “Mike has successfully directed our Purchasing Department for several years, guaranteeing dealers the best fill-rate in the industry,” said Chairman Fred Fox.
“He has also developed strong and well respected relationships with all of our major vendors. We are excited to have Mike at the helm to lead the company as we plan for continued growth and expansion.”

Bruce Schumacher, Director of Purchasing

LeMans is also announcing the appointment of Bruce Schumacher to Director of Purchasing. “Bruce has been a valued member of the LeMans team for many years,” continued Fred Fox. “Most recently he has been very instrumental in our successful expansion into the European market. He will continue to direct the purchasing team at Parts Europe in his new role.”
The LeMans Group distributes to dealers through five warehouses in the United States, two locations in Canada, and its European distribution center in Germany.

News Briefs

America’s top Ohlins suspension dealer Daniel Laine Kyle of Carmel-by-the-sea, California, is likely looking at some serious goal time and major league fines after pleading guilty to tax fraud by hiding cash transactions – he is estimated to have defrauded the US government of anywhere between $500,000 and $1.5m in taxes over a six year period.

A Suzuki Motor America employee is being taken to court by U.S. authorities over claims he knowingly lied for his employer in an application for a Certificate of Conformity under the Clean Air Act – altering documents to show the company would not be over its allotted emissions for the 2012 model year.

Kawasaki Motors Corp., U.S.A. has settled a dispute with the Consumer Product Safety Commission which saw it hit with a $5.2m fine over alleged failure to report an ROV defect that could have created a “substantial product hazard.”

Swiss oil blender Bucher AG is celebrating the 100th anniversary of its formation this year. It started out as a leather and floor care products business called REX in 1917 and evolved to become the Motorex motorcycle lubricant and oil brand in 1947.

MTA Distributing has added U.S. availability of Thai made Vee Rubber tires for V-twin applications.

International Motorcycle Shows

International Motorcycle Shows 2017/18 series

The 2017/2018 dates and venues for the Progressive International Motorcycle Shows series have been announced by owner Universal Business Media – with the cut-down seven city itinerary of 2016/2017 essentially being repeated, with three timings changed (*).
In 2015/2016 there had been 10 venues – for last year Portland, Sacramento, Miami and Phoenix were dropped, with a return to Washington DC added. UBM says that research has shown that “31 percent of the IMS 2015/2016 Tour attendees purchased a new or used vehicle within 12 months of attending a show.”
This will be the 37th season for the IMS series since its inception in 1982 and will see a return for the J&P Cycles Ultimate Builder Custom Bike Show, with builders competing for a cash and prize fund valued at over $100,000 in total during the Tour.  Classes include Freestyle, Modified Harley presented by Harley-Davidson, Modified Custom and Modified Retro presented by Royal Enfield.

  • Long Beach, CA: November 17-19, 2017
  • New York, NY: December 1-3, 2017
  • Minneapolis, MN: December 8-10, 2017*
  • Cleveland, OH: January 26-28, 2018
  • Dallas, TX: February 2-4, 2018*
  • Chicago, IL: February 9-11, 2018
  • Washington D.C.: February 23-25, 2018*
The 2017 ‘King of the Builders’ was Nick Beaulieu of Forever Two Wheels, Windham, Maine, with “The Hate Machine”, an S&S 111” engined custom chopper with a custom-made girder front end, hand-made frame with pentagram downtube and axle blocks, one-off pentagram wheels, hand-made exhaust with pentagram exhaust tips, custom tail section and aluminum gas tank and Baker 6-speed, featuring a BDL belt drive

Motorcycle Storehouse

More in store at Storehouse

Heavy Industry ‘Switchblade’ pegs and grips
Kuryakyn Heavy Industry ‘Switchblade’ pegs are said to have a “rugged appearance with the finesse of proprietary EPDM rubber compound to provide vibration dampening for long haul comfort.” The design allows the rider to deploy flip-out heel rests and the splined adapters allow angle adjustment. Available in chrome or black with or without H-D male mount adapters (for Harley or universal mount with model-specific adapters).
A brake pedal pad is also available for ‘84-‘17 FXST; ‘08-‘11 FXCW/C; ‘93-‘17 FXDWG; ‘08-‘17 FXDF with forward controls; ‘15-‘17 XG 500/750 Street, and all Kuryakyn forward controls.
Heavy Industry grips, available chrome or black, include throttle sleeve and aluminum end caps; fitments include ‘82-‘17 H-D with dual throttle cables (excl. Street); ‘16-‘17 Softail and ‘08-‘17 Touring (e-throttle).

Belt Drives TC2P series
This latest in BDL’s 2” belt drive line-up is a wide open 2-piece motor plate design. All come with a 52-69 pulley drive ratio and a new 6-bolt diaphragm clutch configuration with a “slightly different, truer feel.” They fit ‘07-‘17 Softail (excl. Breakout, Rockers) with cable operated clutch or ‘14-‘16 Touring models with hydraulically operated clutch; available chrome or black.


Lang digital measuring tools
New in the American made Lang Tools line-up are these measuring tools - a digital multimeter and two thermometers to easily calibrate engine temperature.

Cult-Werk solo seats
These do-it-yourself kit form solo seats by Cult-Werk are available with or without upholstery and feature contemporary ‘steam-punk’ orientated styling. The Bobber design comes with a one-piece seat with springs; the Old School design with two-piece seat and springs. MCS say these seats “look great with Cult-Werk’s swingarm-mounted fenders.” Made with gloss black powder-coated steel, the kits include base plate, springs and optional leather upholstery. The Old School design has a gloss black powder-coated ABS frame cover and is available short or long (up to the shocks).


Bridgestone Battlecruise H50
MCS say that Bridgestone’s H50 ‘Battlecruise’ tire “may very well be the best cruising tire yet” thanks to “dynamic testing of all the important factors affecting tires on heavyweight bikes such as endurance, roadholding, cornering smoothness, grip, bump absorption, stability during braking and acceleration” delivering “an overall feel of improvement.”


Dyna forward control kit
This complete, chrome plated (or black finish) steel forward control kit reuses the stock shifter lever on selected ‘91-‘17 Dyna models.


Scorpion EXO-Combat helmets
Described as “aggressive style helmets,” they come with a 3/4 shell and an integrated Speedview drop down sun visor – “attach the front mask and it becomes a full-face helmet. The EXO-Combat is a real transformer for those looking for a ‘badass’ look.” ECE approved.

Biltwell ‘Lane Splitter’ helmets
Crafted around Biltwell’s proprietary ABS outer shell and featuring a shock-absorbing EPS liner with hand-stitched interior padding, cheek pads and BioFoam chin bar cushion, generous vents in the chin bar “get the air flowing, and the outlet at the back lets hot air escape. The ‘Lane Splitter’ shield boasts extremely accurate optics and glove-friendly, simple hinge mechanics for high style and easy removal for replacement or cleaning.”
Replacement shields in a variety of colors and tints will be available later this year. A brass peg and hole configuration on the left side of the shield offers speedy opening and secure closing; mesh pockets are included in the ear recess for aftermarket drop-in communication systems. ECE approved.


Wiley X sunglasses
Motorcycle Storehouse say that “Wiley X is undoubtedly one of the global leaders when it comes to protective eyewear, and we are very proud to be one of their partners. We are looking forward to further introducing the brand to our customers all over Europe and to continue to build the brand together.”


S&S Cycle

‘Grand National’ slip-on mufflers for Touring models

Leveraging their technical support and involvement with the runaway success of Indian’s FTR750 American Flat Track Twins race series this season, S&S Cycle has introduced ‘Grand National’ branded 4” diameter slip-ons for H-D touring applications.

S&S VP Marketing David Zemla says of the new line: “Instilled with the same passion for performance as the S&S sponsored race efforts, the ‘Grand National’ features a high-flow baffle, removable dB reducer and aluminum end cap.”
They are available in chrome or ceramic black finish with fitment for 1995 through 2017 Baggers (including M-8 and Tri Glide trikes). “S&S is one of the few on the market to include a secondary stainless steel baffle (db reducer), allowing riders to tune for sound and performance.”

Made in the USA, the S&S ‘Grand National’ slip-on is 50 state legal on most touring models - for ‘95-‘16 H-D touring models with non-catalyst mufflers (except 2010 Road Glide and Street Glide), ‘09-‘17 Tri Glide models with non-catalyst mufflers and 2017 M-8 engined FLH Touring models.
Additional features include race inspired ‘Grand National’ end cap, high flowing perforated baffle design with removable dB reducer, an “aggressive sound and excellent horsepower” with an easy install for direct bolt-on to stock header pipes or S&S Power Tune duals.