The New York Times reported that Harley is likely to see a prolonged recovery due to the fact that younger buyers (i.e., millennials) are snapping up lower priced used bikes and metric models as opposed to purchasing a new Harley.
“So long as the base of ridership declines (in the United States), it will be an uphill battle for (Harley-Davidson). I have a projection of total motorcycle ridership for the country declining for at least the next five years,” Bernstein analyst David Beckel told the Times.
Harley-Davidson’s U.S. retail sales hit a five-year low last year. The company said last month new-motorcycle sales fell about 8 percent through June this year in the United States, forcing it to lower its full-year shipment forecast and cut production and jobs.
Chief Financial Officer John Olin said on a post-earnings call last month that through May the company saw healthy sales growth of used Harleys, a market more than twice the size of new motorcycle sales.
Harley-Davidson has done more this year to encourage dealers to bring used-motorcycle buyers into the family, said Jim Woodruff, chief operating officer of auction services provider National Powersport Auctions (NPA). “It’s more acceptable for an authorized Harley dealer to have more used inventory this year than last year.”
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