Harley Must Hire a Motorcycle Industry Insider
As this edition of AMD went to press, a slew of US financial data left the short-term economic picture just as unclear as it has been for months (years even!). Which has made the task of coming up with any kind of motorcycle industry half-year 'school report' almost impossible.
In June 2025, US industrial production decreased by -0.2%, while capacity utilization also ticked down to 77.4%. The manufacturing sector saw a slight dip (-0.1%), but excluding motor vehicles and parts (which saw a -6.6% decrease due to ongoing semiconductor shortages), it experienced a small +0.4% increase. Mining output rose, but utilities saw a decrease.
Meanwhile, the headline rate of inflation in the U.S. rose again to 2.7% having ticked up to 2.6% in May, from 2.5% in April. While core consumer prices, which exclude volatile food and energy components, were up at 2.9% in June, from 2.8% in May, there is no substantial evidence of the expected tariff driven inflation spike yet. Economists and analysts are now suggesting that will likely be seen in August and that, against the 'Fed' target for inflation of 2.0% annually, it will likely be in the region of 3.1% by the end of the year.
Why dwell on this, here? Simply because, more than in any other developed economy, inflation data strongly drives consumer sentiment, having an unusually fast cycle effect on consumer spending confidence in the United States. This, in turn can have a very quick short-term material effect on the direction of travel that motorcycle shops can expect to see in business activity levels - especially where P&A/G&A sales are concerned.
So, take your stats of choice and best of luck in trying to form a reliable view of just where the domestic U.S. economy and our place in it will be six-months from now, never mind two to three years ahead.
"Harley dealer eco-system"
Looking at the motorcycle industry registration data isn't very helpful either. Sales numbers have a slower effect cycle on the aftermarket than broader consumer sentiment, but they do feed another toxin into the market's Dopamine, and while slower to impact they also cast a longer-term shadow.
As I write the MIC Q2 sales data had not been released yet, and Harley's own Q2 fiscals are due in around 10 days. But with Harley's own unit decline driving such a large (though ever diminishing) share of the overall On-Highway unit sales market in the United States it is hard not see the Q1 trend continuing.
Domestic U.S. sales of 'street' motorcycles were down over Q1 2024 by -11.4% (-7,571 units) with 58,719 motorcycles reported sold. The overall motorcycle sales picture saw a 12,135 unit decline (-10.2%) at 106,567 units for the quarter.
Internationally the picture is even more difficult. Every few years the European data becomes hopelessly slewed by a prior year-end rush to pre-register unsold inventory before a new tranche of regulations comes into force on January 1st.
While the underlying performance of the European motorcycle market in 2024 was actually very good, with many markets still performing at record or near record levels, the impending transition from the so-called Euro 5 regulatory framework to what is being termed "Euro 5 plus" saw the OEMs slam several tens of thousands of motorcycles through the registrations process in the final three months of the year.
It's not as if the difference between the two regulatory frameworks is all that great, it isn't, but it meant ridiculously high sales in Q4 of 2024 and artificially suppressed data for Q1 pf 2025. That effect has continued in the data through the spring peak sales season and deep into the summer peak riding season.
They have been sold, though often with pretty impressive incentive packages, so they have represented door swings and capital recovery for Europe's dealers and will have fed the new purchase options and P&A/G&A action but making sense of where the European market is at is not easy.
My sense is that Europe is up, in registration terms, all be it modestly - low single digits at best and maybe as little as 1 or 2% in genuine 2025 "Euro 5 plus" new unit sales terms. This despite many of the same headwinds that American dealers and consumers are facing. Though with the additional stress of 'local' issues - not least the little matter of the war in Ukraine, which is still supressing sentiment and impacting public finances.
On both sides of the Atlantic, the fallout from Harley-Davidson's well publicized and at some stages bitter travails continues to weigh heavily on the market, especially on Harley's dealer network.
Continuing the downward trend in the Harley dealer ecosystem, as I write another dealer has shuttered its doors permanently. After 25 years in business, High Country Harley-Davidson, with locations in Frederick, Colorado and Cheyenne, Wyoming, has closed both its stores - merely the latest to find itself impaled on Harley's hubris. Several high-profile stores closed in 2024 alone, including legacy locations in San Francisco, New York City, and Illinois. Reasons cited ranged from economic challenges to ownership changes and corporate "restructuring" (always polite corporate-speak for "chaos and carnage").
The unprecedented Dealer Network churn of the past five years hasn't only affected the United States. There have been some equally shocking examples of remarkably inappropriate dealer management around the world - Germany, Switzerland, UK, Austria, The Netherlands, France, Australia and Japan just name some markets where there have been closures, bankruptcies and downright bad decisions and wrong-headed policies.
Whoever Harley does appoint as its next CEO, it absolutely MUST be someone who knows and understands the international motorcycle industry and, ideally, someone who knows and understands Harley-Davidson as well. Add to my recent candidate list (see AMD June/#311) another name that should be in the frame - Mike Kennedy. He remains a popular figure, in Harley's international markets especially.
Since Keith Wandell was drafted in as a 'Company Doctor' in 2009, Harley has been in the hands of non-motorcycle industry executives for all but four or five of the past 16-years. That has been management's 'original sin'. It is time for the Board to head to the confessional and plead for forgiveness and enlightenment.
.JPG)
