When Jochen Zeitz took over as Harley-Davidson’s new President and CEO in May, 2020, the legendary brand underwent a massive strategic restructuring. Zeitz’s Rewire and Hardwire initiatives slashed models in development, reduced operating costs, balanced supply, and refocused Harley on its core business: Touring models.
While the plan required some time to pan out and a few losses in the process, Harley-Davidson’s Q1 earnings update is an encouraging sign for the MoCo. Buoyed by a resurgent Touring segment, Harley sold 44,200 motorcycles in Q1 compared to 40,400 units during the same period in 2020. That’s a nine-percent boost, but the North American market was responsible for 74% of the sales pie. With 32,800 units already sold this year, the company experienced a 30-percent growth over the 25,200 bikes sold during Q1 last year.
“I am very satisfied with the recovery in all our activities,” said Harley-Davidson CEO Jochen Zeitz, “demonstrating that, especially in North America, the actions taken to reshape our business are having a positive impact.”
While the boom in North America is driving renewed fortunes at the bar and shield, the international outlook is less optimistic. The Europe, Middle East, and Africa (EMEA) market shrunk by 36 percent in 2021, with figures reducing from 7,700 to 4,900. Of course, the COVID-19 pandemic impacted the region’s performance, but the elimination of the Street lineup and the Sportster family not meeting Euro 5 emissions standards also hurt Harley.
The Asia-Pacific sector remained stable with a modest one-percent gain in 2021, but the Latin American market plummeted by 59 percent. Mainly due to the global pandemic and resulting economic situation, Harley’s Latin American Q1 sales slumped from 1,800 bikes in 2020 to only 700 units in 2021.
Overall revenue grew by 10 percent, with the brand’s motorcycle operations accounting for most of that improvement. However, contributions from its financial services also rose from $70M to $259M in 2021, an increase of 272 percent. Similarly, earnings per share ballooned by 273 percent, moving from $.45 up to $1.68. Yes, Zeitz’s master plan took nearly a year to bear fruit, but hopefully, the Motor Company can keep the momentum going in 2021.