Harley-Davidson Inc. has announced plans to overhaul its business after the COVID-19 pandemic resulted in a loss of the business in the three months through June.
Harley reported a second quarter loss of $ 92 million, or adjusted 35 cents per share, as revenue fell 7% year-on-year to $ 865 million. Wall Street analysts polled by Refinitiv were forecasting adjusted earnings of 4 cents per share on revenue of $ 808.46 million.
“Complete rewiring is necessary to make Harley-Davidson a successful business,” CEO Jochen Zeitz said in a statement.
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The Milwaukee-based motorcycle maker, dubbed The Hardwire ,’s five-year strategic plan will include sweeping changes to Harley’s operating model, update the company’s iconic motorcycles, add new products to the mix, and focus on parts and accessories and general merchandise activities.
The plan, which was teased alongside the company’s first quarter results, will also include moving new product launches from August to the start of the year and collaborations with influencers to reach new buyers.
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Harley-Davidson will focus on 50 markets, the majority in North America and Europe, but also parts of Asia. The company is working on plans to exit markets where volumes and profitability do not allow further investment.
The Rewire, Harley’s previous course correction plan that will continue until the end of 2020, is expected to result in savings of $ 250 million this year and $ 100 million in annual savings thereafter. The plan reduced global inventories by 32% and pushed up prices for used motorcycles.
Harley has not provided financial guidance due to uncertainty caused by COVID-19.
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Shares have fallen 21% this year through Monday, worse than the S&P 500’s 0.27% gain.