Harley Davidson Forecasts Dull 2017 Because Of Shipment Reduction

Harley Davidson announced that motorcycle shipments done in 2016 does not meet the proper sales target

The target as estimated and has been reduced due to tough global competition. Thus motorcycle company forecasts on reduced number of motorcycle shipments for this year.

The motorcycle maker informs that the dealers in the United States still have the stock of too many 2016 models from the end of the fourth quarter 2016, which is the main reason that led Harley to limit shipments of its 2017 models which also includes higher-margin touring motorcycles having the new “Milwaukee-Eight” engine.

John Olin,the Chief Financial Officer of the company expecting about 51.2 percent of the U.S. big-bike market, Olin said on a conference call, that it will focus on selling 2016 motorcycles through the first quarter of 2017. He also said that they expect $20 million to $25 million as gross margin in 2017. And Harley expects its 2017 gross margin must be in line with 2016 margin level.

The Harley Davidson industry has announced that they planned to ship 66,000-71,000 motorcycles in the first quarter of 2017 which is 20.5-14.5 percent lesser from the previous year. This definitely hurts as the competitors such as Japan’s Honda Motor and Polaris Industries, the Indian motorcycle maker, have reduced the prices to entice their customers. Harley’s other rivals include Kawasaki Heavy and Germany’s Bayerische Motoren.