issue 186

Harley-Davidson ended last year on a high note. The best, most profitable Third Quarter Financial Report in three years. The supply chain problem seems to be over. Dealer showrooms are full of Harleys with sold signs on most of the bikes. There are waiting lists to get your bike serviced. There is even talk that the dreaded computer chip shortfall is over. 

All that said there are dark clouds on the horizon. Crazy political upheaval in the Northern Hemisphere and even a major war. Then too there are scary financial numbers like in 2008. Because of good financial government oversight, Australia like in 2008, seems to be in better shape than the money-printing rest of the world financial markets. That’s good news for us and H-D Australia-New Zealand. As you know we got through all those bad things in the past by riding our motorcycles. Things are a-changing, and for the better!

So what does that have to do with Harleys? Everything. You see, if you know your Harley versus Indian Motorcycles history, Indian and Merkel probably made better motorcycles but Harley had better book keepers. After all the Davidsons were Scottish. Which takes us back to the Third Quarter Harley financial report mentioned above.

Jochen Zeitz became the H-D CEO in 2019. He was known for saving the Puma sporting company. His plan was just like the Davidson’s from 1903 onward. Make a great product that people wanted but number one was to pay the bills. Indian went broke in 1953 while Harley-Davidson masterfully pressed on in those many troubled times. Like the 2008 World Financial Crisis and now with the Covid-19 pandemic which masked the real problem of the coming world financial woes, like Russian’s new empire building and the “building” boom and bust in China.

Fortunately for Harley-Davidson, Jochen is showing the way. First he cut out all the duplicate bikes that no one asked for. Built and delivered almost enough bikes barely meeting demand. Raised the prices to whatever the buyers were willing to pay. And most importantly, cut costs and handled the stupid tariffs with Harley assembling bikes in Thailand for the EU, Asia and for us in ANZ.

Then, as you have seen in the last few years under Jochen, when he said “one of my personal highs of the year (2021) was watching Kyle Wyman win the King of the Baggers series …with performance baggers.” He went on to say “Touring is the very core of our business and our heritage. We do it better than anyone else.” 

Just recently with the Third Quarter report, Jochen announced the “Repurpose” of the huge historic factory building in Milwaukee keeping the Willie G. Design Center and consolidation of the USA assembly and logistics in York. A new logistics company knows the automotive business and is bringing in its expertise to Harley while keeping the 600 blue-collar workers. And interestingly Jochen is letting people continue to work from home.

My point is simple. Look at what Jochen has done, what models he has cut and where he is leading the Motor Company, back to profitability for the investors and great bikes for the core riders. Case in point, go to my favourite website at www.h-d.com/us and click “BIKES” where you can see what the Motor Company is selling/sold in the USA. Go to www.h-d.com/au and see our market, we have the Breakout but the Yanks don’t. 

Now you see where Harley is going when you drop down to COLLECTIONS: CVO, ICONS, AND ENTHUSIASTS. Those three in capital letters are shouting at you, these are the big profit money makers for the stockholders!

Let me put it to you simply, Ferrari and Porsche don’t make “no” budget entry-level cars. That’s the future baby. Get use to it. The “budget” Harley is the PRE-OWNED MOTORCYCLES on the h-d.com “H-D1 Marketplace”…and great buys for the smart money! That said, Harley does really need something like in the past that if you “purchase a Sportster and we’ll trade it up for the same price you paid for it”. Buy an entry level Sportster and you get full trade-in on a big twin M8 within a year.

The need for an entry level inexpensive Harley is shown by the Softail Standard with an M8 107 engine is cheaper than a Sportster Nightster 975 here in Australia. Harley doesn’t want to sell you a “build it yourself Standard”; but it wants to sell you a FXLR ST 117 with a $9,000 paint job and boombox. Then let the dealer fit a few performance goodies from the parts bin.

The proof to me that Harley isn’t looking at the mass market is it didn’t even show up in 2022 at the biggest motorcycle show in the world, the EICMA in Milan Italy. Where a few years ago it teased the Pan America and Bronx. That says to me, why compete in price with the mass market Asian streetfighters with marginal profits? 

So let me fall down on my sword and make a few predictions for 2023: 1) No more “Standard” model Harleys. 2) Icons, Revivals, Apexes, Enthusiasts and of course CVOs are where the profits are. 3) The Pan Am will have a 975 little brother. 4) And drum roll please, eventually the core riders will get an update to the 2008 Touring frame…with all the same Batwing, Road Glide fairing, FXLR ST Dais Nagao fairing. But the frame will be upsized with dual-rear shocks. It will be lighter, stronger and stiffer like the Softail M8s. Just for grins it may come with a future proof RevMax 1800cc torque monster engine. 6) The next 2023 Icon should be the Revival of the 1936 EL, the model that blew away the competition. 

Way back in 2019, the offical HOG magazine published the “Bikes that changed Harley-Davidson history.” Three of those bikes have been revived as CVO models (1977 Low Rider, 1980 FLT Tour Glide and the 1984 Softail.) Thus leaving only the 1909 Model 5-D with the first Harley V-twin, and the 1936 EL Knucklehead with the new overhead valve engine. 

But wait a minute – after serving us for 66 years, the air-cooled Sportster deserves to be the next Icon model. But just one year before the Sportster was the Elvis’ 1956 KH model which was on the cover of The Enthusiast Magazine with the most rememberable paint job, ever. So the Elvis KH has my vote as the next Icon in 2023. 

I’ll go one step further and say Harley should have enough end-of-the line Sportster Forty-Eight 1200s left over. Or if not they surely have some spare 2022 Sportster Nightster 975s.

That’s all from me. Enjoy riding in 2023!