Harley and Chief Marketing Officer part companyIn a move that appears to have been signposted by Harley-Davidson's October third quarter fiscals, Harley has parted company with its Senior VP/Chief Marketing Officer Mark Hans Richer.
At the time of writing it wasn't clear if Richer had received a better offer, had fallen on his sword, or had been invited by CEO Matt Levatich to pursue the next stage of his career elsewhere.
Either way, the biggest surprise about the announcement is not that it has happened at all, but that it didn't happen before Harley's Q3 announcement. Then again, Richer's divesting of share options some three months ago (he wasn't the only senior executive or board member to be doing so) may hint at an earlier decision and a tactically delayed announcement.
In a statement, CEO Matt Levatich said: "In his time with Harley-Davidson, Mark Hans was instrumental in achieving our transformational goals, including expanding our reach to both core and outreach customers, and we thank him for his contributions. The changes are an important piece of the company’s recently announced plan to build on its leadership position in the market and grow demand, with a key objective to lead in every market."
Those who have been voicing surprise at Richer's departure clearly had not read between the lines of Levatich's October statements, and his reference here concerning "expanding our reach to core customers" shouldn't be allowed to fool anyone.
The new marketing and four-point action plan that accompanied the quarterly financials contained a thinly veiled critique of the bottom-line effectiveness of Harley's marketing policies; hinting that for all the benefits that out-reach, crowd sourcing and exploitation of new customer demographics may have brought, and that "likes" and Twitter followers had generated, hadn't translated into sufficient metal shifted at a time when the company had allowed its core demographic and patronisingly referenced "legacy" customers to go shopping for competitive offerings.
If the company had managed to convincingly expand its reach to core customers, then they'd have left Polaris no demographic real estate to occupy with Indian.
Richer joined Harley from GM in 2007, while Jim Ziemer, a 40 year Motor Company veteran, was CEO and two years before Keith Wandell was hired to fire fight the company back into the world of the living. Since joining Harley, Richer had successfully consolidated his position, accruing seniority and a burgeoning portfolio of "reports."
His prior positions have now been shared out between two of the executives he had hired.
Sean Cummings (a very experienced international powersports and recreational products industry executive) moves up from Latin American market management to being Senior Vice President of "global demand." Cummings joined Harley in 2014.
Shelley Paxton steps up to become VP Marketing and Brand from her Digital Strategy Officer and VP Global Integrated Marketing and Planning roles, having joined Harley (from Omnicom Media) in 2010.
While Richer was surprisingly well regarded for the marketing job he'd done among Harley's dealers, the speculation will be that Levatich hasn't been minded to trust him with the job-loss funded additional emergency marketing spend that he unveiled last month.
Meanwhile, the scope of those job losses being used to pay for the emergency marketing spending has become apparent with 250 lay-offs of salaried staff expected by the end of 2015 and speculation already rife in the Milwaukee area that this will turn out to be just a first stage tranche of job losses.
These job losses come just two years after the company started to see the full $50 million annual benefit the 950 job cuts and benefits changes triggered by the new seven-year labor contract that was eventually agreed with Harley's unions in 2010. That "agreement" was only finalized after then CEO Keith Wandell had threatened that the company would consider leaving Wisconsin if the unions weren't prepared to play ball.
Having lost some 15 percent of its stock market capitalization within 24 hours of the October Q3 financial announcements, and having struggled to recover any more than around a third of that value by the time of the November 4th Richer announcement, as of 24 hours later Harley's stock was still moribund at around $50, still $6 south of its pre-Q3 announcement level.
Meanwhile Keith Wandell has added further to his portfolio of independent directorships with a seat on the board at Dover Corporation, the diverse 7.8 Bn turnover owner of PMI (Performance Motorsport Inc), itself the owning division of such powersports industry staples as Wiseco, JE Piston and X-Prox in The Netherlands.
Dover is currently seeing Group sales decline (-9 percent for the first nine months of the year), so are no doubt eyeing Wandell's turn-around expertise; as did his bankrupt former competitor, battery maker Exide Technologies, when they poached him as their new Chairman earlier this year - a role he accepted in tandem with bringing his trusty side-kick at Harley along for the ride - CFO John Olin, as a board member at Exide as the company prepared to exit from its bankruptcy protection filing.
Interestingly Harley-Davidson has so far been coy about the batteries it plans to use for its promised Project LiveWire E-Bike. Although Exide has always been a traditional lead-acid battery maker, they have been and are investing heavily in electric vehicle battery technology and research ... what price the LiveWire having Exides in it, if it does finally ever enter production?