Comes after the Milwaukee firm loses ground in the market

Recently, we were contemplating about Harley’s upcoming new models, ’Bronx’, ’48X’ and ’Pan America’, as part of their new strategy to add 100 new models in the coming decade. But it looks like the Milwaukee Bar & Shield brand is not able to register any success stories today due to its current downward trend in the market.

Taking considerations of customer demands, the firm has decided to close its factory in Kansas City, Missouri, in 2019 and consolidate its production in York, Pennsylvania. This will cut around 800 American jobs from the production ranks in Kansas and add 450 positions to its York facility that had lost 118 jobs last year.

Harley-Davidson decides to pull the plug of its Kansas City plant Exterior
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Harley-Davidson has become a worldwide brand now after aggressive expansion that took place in the past decade. It gave the brand new customer bases and everything went according to plan for Harley until 2017 where the brand registered a 6.7% downfall worldwide. In the US alone the numbers were down by 8.5% compared to the previous year.

Additionally, the motorcycle industry as a whole continues to suffer in terms of attracting new riders, with the only major growth markets occurring in protected territories, like South American and Asian countries. Harley also had to undertake issues from two trade unions last year where it reached solvency of their partnership agreements after reaching an impasse on labor issues.

Harley-Davidson decides to pull the plug of its Kansas City plant Exterior
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Closing the Kansas plant will cost Harley close to $200 million through 2019 but will save $65 million to $75 million in annual cash after 2020. Talking politically, this is the brand our president praised last year as a "great example" of a business that creates jobs and builds plants in the USA. Things weren’t much different then, but have gotten worse now with the company projecting that their global sales will further drop by 4.9% in 2018.

Joe Capra, directing business agent for Local 778 of the International Association of Machinists & Aerospace Workers told the local news “They didn’t even give us a call ahead of time, It is real devastation for these people who work here and work hard in the Kansas City area.”

Harley-Davidson decides to pull the plug of its Kansas City plant
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The $2.5 billion used bike market happens to be the biggest competitor for Harley as many new riders opt to buy a used bike before they move into a brand new one. The many baby boomers who were once upon a time Harley’s rich base, are no longer active and are putting up their old Harleys up for sale. In May 2017, there was healthy sales growth of used Harley-Davidson bikes. 2.5 times more than brand new Harley sales.

To slow the downtrend, Harley has implemented new strategies including enhancing its riding academy to attract customers towards its products. New models like the Street rod and the upcoming ’Bronx’ and ’48X’ are supposed to draw fresh breed of riders early in their riding stint. Hopefully, it can do wonders sending Harley back to its glory days.

Harley-Davidson decides to pull the plug of its Kansas City plant
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