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  1. #1
    Senior Member Judy's Avatar
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    Once lauded by Trump, Harley-Davidson is now sputtering

    Once lauded by Trump, Harley-Davidson is now sputtering

    By Aimee Picchi
    Updated on: January 30, 2019 / 1:12 PM / MoneyWatch

    Harley-Davidson is losing speed, hurt by the Trump administration's trade war and the aging of its core baby-boomer customer base.

    The motorcycle company on Tuesday said its profits were erased by a double-whammy of higher costs from tariffs and slumping sales. Inroads from a rival, Indian Motorcycle, is also taking a bite, according to analysts.

    To be sure, tariffs aren't the only woes facing Harley, but their impact has thrust the company into the spotlight thanks to its rocky relationship with President Donald Trump. Early in his administration, Mr. Trump lauded the company as an example of America's manufacturing prowess. But his opinion soured last year after Harley said it would move some manufacturing overseas to escape retaliatory tariffs from the European Union.

    Harley Chief Financial Officer John Olin said in an earnings call on Tuesday that its Thailand plant is on track to produce enough vehicles to meet demand in Europe, China and other Asian countries by the end of 2019. Even so, the company expects a hit of as much as $120 million from tariffs this year, he said.

    "During 2019, we expect incremental tariff cost to be approximately $100 million to $120 million," Olin told analysts. "These costs include EU, China tariffs on our products shipped from the U.S. as well as U.S. tariffs on certain items... coming from [the] international market."

    Along with tariffs, Harley also faces "more pressure than we can remember" due to rival Indian Motorcycle and an aging core customer, Wedbush Securities analyst James Hardiman said in a research note. Investors are likely worried about the "increasing number of retiring baby boomers [who] will continue to put negative pressure on demand, which is in long-term secular decline."

    That pessimism is showing up in Harley shares, which have lost almost one-third of their value in the last year. The stock rose $1.45, or 4 percent, to $36.21 in early afternoon trading.

    "We believe that investors have soured on the story, as the various bull cases that fueled the stock (takeout rumors, new bike demand, Trump bump) appear to have largely fallen flat," Hardiman said.

    First published on January 30, 2019

    https://www.cbsnews.com/news/harley-...ow-sputtering/
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    Senior Member Judy's Avatar
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    What cooked your goose was closing plants in the United States and moving them to foreign countries. How you could have been this stupid is beyond me. Apparently you know more about making great motorcycles than you know about your customer base.

    To an American buyer, a Harley made in .... Thailand ..... ain't no Harley.
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    Senior Member 6 Million Dollar Man's Avatar
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    Quote Originally Posted by Judy View Post
    What cooked your goose was closing plants in the United States and moving them to foreign countries.

    To an American buyer, a Harley made in .... Thailand ..... ain't no Harley.
    I couldn't agree more!

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    Moderator Beezer's Avatar
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    Indian Motorcycles needs to capitalize on this and get the ads out.
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    Senior Member 6 Million Dollar Man's Avatar
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    Quote Originally Posted by Beezer View Post
    Indian Motorcycles needs to capitalize on this and get the ads out.
    If they were smart they would. If they came out with a commercial stating how they are made in the U.S., while talking about how Harleys are now foreign made, I bet a lot of people who are looking to buy a bike, would switch over to them instead of buying a Harley.

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