Heard it from a mile away... Harley-Davidson stock surged 22% yesterday after the motorcycle legend reported expectation-beating earnings. Harley's quarterly sales fell 8% compared to a year ago, but profit spiked 39%. That's because Harley's new CEO Jochen Zeitz has been majorly streamlining:
Bring back the bicep tats... and the head bandannas. Before Zeitz took over in February, Harley was chasing a new customer base: Millennials. It tried to win young love with cheaper, smaller rides like electric motorcycles and bikes. The old CEO wanted to launch up to 100 of these models. The new CEO doesn't care if a 25-year-old from Williamsburg likes it:
Harley's choosing short-term gain over long-term growth... Harley's cost-slashing, Boomer-focused plan means higher profits now. But its US bike sales have fallen for five years straight through 2019. Meanwhile: cuter, youth-friendly motorcycles have lifted sales for rivals like Polaris and Eicher. Harley needs to take Millennials along for the ride to notch long-term growth.