Slow Q3 on lower shipments for Harley-Davidson

Publish Date: 
Oct 23, 2012

MILWAUKEE, Wis. – Harley-Davidson had a tougher third quarter, with new bike sales down 5.2 percent in the United States and 1.3 percent worldwide compared to the prior-year quarter on lower shipments.

Sales were up 7.6 percent in international markets for the quarter ended Sept. 30, but that wasn't enough to offset the declines in established markets.

Chairman, president and CEO Keith Wandell sees better days ahead.

"We believe our U.S. dealers' third-quarter new motorcycle sales were adversely affected by a limited availability of new motorcycles in July, August and early September resulting from the ERP implementation at [the York, Pa., plant] combined with the move of Harley-Davidson's annual new-model launch to late August from late July,” Wandell said. “As U.S. dealer inventory returned to more appropriate levels and the new 2013 motorcycles became more available, retail sales responded positively and gained momentum as we exited the quarter.”

During the quarter, retail unit sales decreased 4.7 percent in North America (U.S. and Canada) but increased 32.3 percent in the Latin America region, 9.8 percent in the Asia Pacific region and 1.8 percent in the EMEA region compared to last year's third quarter.

U.S. heavyweight new motorcycle retail unit sales increased 3.8 percent through nine months of 2012 compared to the prior-year period, the company said.

Worldwide, dealers sold 61,053 new Harley-Davidson motorcycles in the third quarter of 2012 compared to 61,838 motorcycles sold in the year-ago period.  Dealers sold 40,402 new Harley-Davidson motorcycles in the U.S. compared to sales of 42,640 units in last year's third quarter. In international markets, dealers sold 20,651 new Harley-Davidson motorcycles during the third quarter compared to sales of 19,198 units in the year-ago period.

"Harley-Davidson had a lot of exciting news for customers in the third quarter, with the launch of the 110th Anniversary year and Anniversary Edition motorcycles, and the rollout of our exciting full line of 2013 bikes. While we see great untapped opportunity at retail, we continue to temper our expectations in light of continued softness in the global economy," Wandell said. 

Over the first three quarters of 2012, new unit sales grew 6 percent overall: 6.2 percent in the U.S. and 5.4 percent internationally compared to the year-ago period. Through nine months, dealers sold 206,444 new Harley-Davidson motorcycles worldwide, with retail unit sales up 47.5 percent in the Latin America region, 14.1 percent in the Asia Pacific region and 6.0 percent in North America and down 2.9 percent in the EMEA region compared to the year-ago period.

Revenue from motorcycles during the third quarter of 2012 of $774 million was down 16.1 percent compared to the year-ago period. The Company shipped 52,793 motorcycles to dealers and distributors worldwide during the quarter, down 14.5 percent and in line with prior guidance, compared to shipments of 61,745 motorcycles in the third quarter of 2011.

Revenue from motorcycle parts and accessories were $233.7 million during the quarter, down 0.8 percent; revenue from general merchandise, which includes MotorClothes apparel and accessories, was $75.6 million, up 9.1 percent compared to the year-ago period.

Through the first nine months of 2012, the company shipped 200,558 motorcycles to dealers and distributors, a 10 percent increase compared to the year-ago period. Through nine months, revenue from motorcycles grew 8.4 percent to $2.99 billion, revenue from parts and accessories grew 6.6 percent to $698.4 million and revenue from general merchandise grew 10 percent to $225.4 million compared to the year-ago period.

The Motor Co. plans to ship 245,000 to 250,000 motorcycles to dealers and distributors worldwide in 2012, a 5- to 7-percent increase from 2011. In the fourth quarter, the company expects to ship 44,500 to 49,500 motorcycles, a 2- to 12-percent decrease from the year-ago period, consistent with previously announced plans related to the implementation of surge production at the York plant in the first half of 2013.

The company said it believes surge production provides the flexibility to produce more motorcycles in the first half of 2013, closer to customer demand during the prime selling season. 

Posted by Holly Wagner