During the last 20 years, Harley-Davidson did a magnificent job at fullfilling the needs and wants of the rebel inside all of us. In the mid 80’s, with a brand symbolizing the American dream of independence and freedom, Harley-davidson was able to seduce a still young generation of “Baby Boomers” who embraced their image and bought in droves a lot of their bikes. In the 90’s, until 2006, Harley was able to constantly redefine its image to fit in the lifestyle of the aging rebels and had an easy job at adapting its models just by observing the popularity of new design trends (stretch, rake, 6-speed transmissions, wide tires, etc). imposed by a vibrant custom motorcycle industry
Dealers went from motorcycle shops to luxurious “Harley Dream Department Stores” which became one of the entertainment places for the MWTK’s (married With 2 kids) and older EN’s (Empty Nesters) to spend part of the money of their peak income years. A booming economy financed by too easy borrowing at very low rates amplified the success of many companies, and you can put Harley Davidson motorcycles in the top list of discretionary purchases that many could not really afford if not extracted through credit card charges and equity lines of credit . It was way too easy for Harley-Davidson and the custom motorcycle industry. The Milwaukee company started to lose track of who were their loyal consumers. For me, the symbol of this disconnect is when Harley-Davidson was ridiculed for having Elton John headline its massive anniversary party, not exactly the music of choice for those more inclined to wear black leather and jeans than beige Dockers and Ralph Lauren polo shirts.
In addition Harley could not see, like most consumers, that we were riding inside an economic bubble. Consequently its executives fell asleep at the switch, easily expanding sales by borrowing very cheap money to lend it for a profit to all those who wanted to own a Harley. Financing bikes on 6-year terms became its main source of profit. During that time Harley-Davidson completely forgot to think about the way to connect, both in terms of marketing and new products, with the new generation of motorcycle riders moving up through the ranks. Hello Harley, they don’t have as much money to spend on a motorcycle, they speak a different language, listen to other bands and don’t want to look like their baby-boomer parents and ride the same bikes. One of my favorite quotes is from famous hockey player Wayne Gretzky: “skating to where the puck is going to be, not where it has been.”
What we see now coming from Milwaukee iis damage control. And it takes time. 1-Reshaping the company by cutting costs anywhere possible to re-establish the company in a financial situation where it can refinance its debts, satisfy Wall Street and its share holders. Mission accomplished. Harley has a ton of money to lend to its buyers and the stock is up 98% for the last 12 months. 2-Multiplying promotional incentives and discounts and limiting production to ease the burden of too many new bikes on the dealer floor. Mission in progress… 3-Talking to and helping minorities and women access to their motorcycles. In progress… 4-Painting some of its existing models in flat black, replacing chrome shine by dull powder coating, and calling the new line ‘Dark Series” to attract the new rebel X & Y generations? Convincing? Not really, but nothing else that Harley-Davidson could do in a short time. But what’s next? It has to be true new models (following the heritage) that the less than 35 year-olds can afford without over borrowing because they are already the most indebted young generation (student loans, cars, 1st time homes).
The custom motorcycle industry can’t live well without Harley-Davidson succeeding its transition to a completely new motorcycle world with brand new models at more affordable prices. Of course, Harley knows this. Your comments and sometimes very harsh critics in my Blog towards the mother company is for me the proof, if any necessary, of your great expectations and of your strong affective attachment to the brand. Baggers and Trikes are not the future of Harley-Davidson in terms of volume. Not beyond 5 to 10 years. Right now they are just popular bikes in majority for the aging/old rebels. So, the custom versions done today by custom builders are not the future of the custom motorcycle industry beyond the same lapse of time.
Custom Builders and after-market part manufacturers have always been a huge source of inspiration for Harley and other clone manufacturers . And it will never stop to be this way. New old school bikes are very cool, but contrary to common belief, are in majority bought and customized by an already 35/40 year old crowd, and most will never be for long distance rides. And miles ridden have a strong positive influence of the motorcycle industry health. V-Twin or V-rod sport bikes? What else? A major trend has yet to emerge, one susceptible to persuade youngsters to ride, to visit a Harley dealership, to order one (under 10 k), to have it customized or built from the ground up by a custom shop. I am not sure that Harley-Davidson will be ready right away with new models for youngsters and DINK’s (Double Income No Kids) to take full advantage of the inevitable motorcycle industry rebound. And us on the custom side. Are we ready? Maybe, instead of whining at Harley, should we work harder at defining the new lines, the street legal platforms and components able to turn a youngster into a biker. Harley-Davidson may follow…(pictures copyright Harley-Davidson)