FILE PHOTO: The commemorative nameplate on a special edition Harley-Davidson motorcycle reflects the company headquarters in Milwaukee August 28, 2003. REUTERS/Rick Wilking/File Photo
(Reuters) – Harley-Davidson Inc (HOG.N) is reopening its factories this week at lower production rates and sending dealers a narrower range of motorcycles, the Wall Street Journal reported on Wednesday.
The U.S. motorcycle maker, which closed its U.S. assembly plants in March due to the coronavirus outbreak, may not ship any additional new motorcycles this year to about 70% of its 698 dealers in the country, the report said.
Harley would reopen its plants in Wisconsin and Pennsylvania and accelerate production in phases that would be limited to bestselling models and palette of colors and without customizable features for the remainder of the year, the report added.
The company has failed for years to increase sales in the United States, its top market which accounts for more than half its motorcycles sold. As its tattooed, baby-boomer consumer base ages, the Milwaukee-based company is finding it challenging to attract new customers.
To make matters worse, the pandemic has further dented demand as Americans stay at home to curb the spread of COVID-19.
In April, the company’s then acting Chief Executive Officer Jochen Zeitz, who has since taken a permanent role at Harley, told investors about plans to cut costs and “de-emphasize” some of its unprofitable international regions.
Jochen and team are currently working on a new 5-year strategic plan here to revive sales which the company plans to reveal in the second-quarter earnings update.
The shift in strategy for the company that symbolized the counterculture movement of the 1960s comes as it struggles to woo the next generation of younger riders with its electric and more nimbler bikes in the United States.
Harley did not immediately respond to Reuters’ request for comment.
Reporting by Ankit Ajmera and Rachit Vats in Bengaluru; Editing by Shinjini Ganguli