May 4, 2009 – Harley’s 1Q bike sales fall in U.S.
May 4, 2009
Filed under Features
Harley-Davidson’s U.S. retail sales are down in the first quarter, but its market share is up significantly, the company reported.
Harley officials said the company’s market share in its relevant market (the 651cc and up motorcycle segment) rose to 57.8 percent in the first quarter, an increase of more than 8 percentage points over the year-ago quarter.
In his last earnings conference call before his retirement, Harley CEO Jim Ziemer attributed the market share gain to the company’s strong brand image and the fact that metric manufacturers did not have a substantial number of lower-priced, non-current model year bikes in the market this year like in the first quarter of 2008.
Overall, Harley reported its U.S. first-quarter retail sales fell 9.7 percent compared to the prior-year period. The U.S. industry in the Harley-relevant market fell 22.3 percent during the same time period, company officials said.
“We are mildly encouraged by this lowest rate of retail sales decline relative to the prior two quarters, but we do remain cautious,” said Tom Bergmann, Harley’s chief financial officer.
Harley’s worldwide motorcycle sales fell 12 percent in its first quarter due to lower demand internationally. Sales fell in Canada by 30.4 percent and in Europe by 17.4 percent.
“Clearly many European countries are experiencing the same economic challenges as many other parts of the world compounded by the late arrival of spring weather in some European countries,” Bergmann said, before noting, “however, we did see retail sales trends improve in late March compared to the rest of the year.”
International sales also fell in the company’s Asia Pacific Region (7.2 percent) and in Latin America (26.3 percent).
The company saw sales decreases in its parts and accessories, by nearly 7 percent, and in its general merchandise, which includes apparel and collectibles. The latter dropped 10.5 percent compared to the previous-year period to $75.2 million.
Harley’s financial services segment reported a significant drop in income. This segment reported $11.2 million in income, a drop of $23.7 million or nearly 68 percent. psb