After too many years, Harley Davidson is posting good revenues and profits and this is only the first year of its five-year 'Hardwire' strategic plan.

Harley's Fortunes Looking Up

Analysts might have forecast a strong fourth quarter of 2021 for Harley Davidson, but no-one expected it to be quite that strong!

At the end of the first of the company's five-year Hardwire strategic plan, revenues totalling $1.02 billion were recorded, which are a 40% increase compared to the $725 million reported in the same quarter of 2020. That resulted in a net income of $22 million, compared to a net loss of $96 million in Q4 2020. For the year, Harley-Davidson reported a 2021 net profit of $650 million compared to a profit of $1 million in 2020. In total, motorcycle sales were up by 8%.

Of course, comparing anything to 2020 is likely to show good growth, given the trading conditions as the pandemic gripped the globe and paralysed virtually everything: a more relevant comparison would be with 2019, the last year of 'normal' trading before the pandemic but 2021 was sufficiently back to normal for any company to consider financial results as encouraging.

As expected, the Pan America had much to do with the boost in profits, quickly becoming the number 1 selling adventure bike in the U.S. since its launch earlier in the year. But there were also some other positive indications.

Part of the Rewire/Hardwire plan's aims was to simplify the product line-up by reducing the product line-up, which has traditionally been complicated. Forecasting a reduction of 30%, Harley actually achieved a 40% reduction.

The Livewire dealer network grew from 20 retailers to 49 which is impressive by any standards but to happen in one year is amazing.

Pan America and Livewire might be new departures for Harley and showing that that is the direction to take in future but that would be to ignore the popularity of its traditional product offerings. The recently announced 2022 Low Rider ST apparently sold out its first allocation in just ten minutes! Harley may be seen as a traditional manufacturer, but then its customers are also traditional!

The figures are hugely encouraging for Harley: for one thing, they have validated the gamble they took on the Pan America. Hopefully, this will be the catalyst for some more out-of-the-box thinking. If Harley can do that, then they have all the boxes ticked and their future survival is assured.