Harley profit drops 84%; Buell shut down

[OhioChick]

Source: Market Watch

Oct. 15, 2009, 10:14 a.m. EDT

SAN FRANCISCO (MarketWatch) -- Harley-Davidson Inc. shares shrugged off early declines Thursday after the motorcycle giant reported a steep drop in third-quarter profit and said it will discontinue production of its Buell sport-bike brand.

Harley /quotes/comstock/13*!hog/quotes/nls/hog (HOG 26.66, +0.40, +1.52%) stock followed the broader market back into the green by midmorning, up 1.4% at $26.64. The shares are up 57% since the beginning of the year.

The Milwaukee-based company posted a profit of $26.48 million, or 11 cents a share, an 84% retreat from $166.54 million, or 71 cents a share in the year-ago period.

The latest quarter included a one-time charge of $14.2 million related to Buell and a goodwill impairment charge of $18.9 million related to the sale of MV Agusta.

Total revenue fell to $1.1 billion from $1.4 billion a year earlier as retail sales fell 21.3% worldwide and 24.3% in its home market.


Read more: http://www.marketwatch.com/story/harley-posts-84-profit-drop-shuts-down-buell-2009-10-15

[dugaresa]

1. the middle class can no longer afford such luxuries, things like high unemployment and rising health

costs are what kills this type of industry

[high density]

5. Yep

If you don't pay people a decent wage, they can't buy $15-30k toys.

[tridim]

2. Harleys are too expensive, by a LOT.

Harleys used to be utilitarian vehicles built for the common man. Now they're exactly the opposite.

Luxury-retro is probably not a wise recession-proof business model.

I'll probably get flamed for saying that, but it's true.

[snooper2]

6. you shouldn't get flamed, why the fuck would I buy a Harley

when I can get this for less :)

[8 track mind]

10. mmmmmmm the rocket 3! n/t

[av8rdave]

18. I test rode one of those a couple of years ago...impressive!

[tridim]

20. I still don't trust Triumph

But they sure make pretty bikes. Always have.

My Dad had a TR-6 in the 70's and it drove him insane almost every weekend. Coolest POS car ever?

[snooper2]

22. Their bikes are a whole different animal...

Which is obviously a good thing :)

[av8rdave]

27. I don't either, but their bikes are vastly better than they were years ago

I still wouldn't buy one, but that rocket was a blast to ride.

[Blue_Tires]

7. remember, buying H-D is as much about buying into a 'lifestyle'

as it is a motorbike

[Gman2]

8. I dont mind that so much, but they dont turn, zoom or stop. They are a deathtrap.

I feel all cruisers are an accident waiting to happen.

I also think that harley should be part of any green car stuff. Lghtweight{friggin relatively speaking} structures, and maybe a motor that doesnt run like a misloaded washing machine. Motorcycle cos. are better placed to make new, lightweight cars, with zippy performance, efficient and even racey stylish. I already want one.

Where, other than gov, is the seed money going to come from?

[tridim]

9. Isn't that basically what Buell was?

And they just sold it.

[Gman2]

14. Thats a moto, a luxury, I'm talkin newtech cars.

[sofa king]

16. I always considered Buell to be just the racing wing of Harley.

Not that a Buell won a race, ever, in its entire history, until last month. But for those who for reasons of warped patriotism refused to buy an Asian or European crotch-rocket which was better, faster, and cheaper by far, Buell was a major choice. They wouldn't be my first guess as the company which can make the leap to highly efficient and inexpensive cars, because their bikes are already neither of those things.

I will say, however, that the ones I've looked at from time to time have a unique style and a lot of personality. I'll bet the people who own Buells adore them.

[tridim]

17. I almost bought a Buell Blast

I'm a big fan of small displacement, small bikes. I guess it's a good thing I didn't bite on that one.

Small bikes are plenty fast and generally don't waste energy accelerating hundreds of pounds of useless chrome plated accessories.

[sofa king]

34. Yep, small is cheap, too.

I just figured out that my 50cc moped has cost me, including everything I can think of from oil to fuel to the $20 in spare parts I've had to buy and the price of the moped when I bought it new, about 3.5 cents per mile and dropping at 11,000 miles. Compare that to 49 cents per mile for a Volkswagen and you can see why I don't want to go back.

The downside, of course, is that it only does 30 mph, is brutally cold and wet in anything but hot weather, looks like a clown bike, and angers other drivers, one of whom is going to put me in the trees one of these days. But until then, I can go anywhere in the state in one day on a handful of pocket change.

[8 track mind]

11. the only decent bike they ever made was

the XR750, which of course wasn't street legal.....

[8 track mind]

13. They were never worth a damn off road anyway

The Legendary Jim Holley at his finest!

[tridim]

21. That's a hilarious pic.. Nice slicks!

Is that an AMF era Harley?

[8 track mind]

30. dont think so

this was done in 1984. This was an April fool's story from dirt bike magazine. super crosser Jim Holley did actually jump that fully dressed Harley. That landing had to be totally unpleasant.

[dysfunctional press]

24. the way i've always looked at it-

if you're in a car, and have an accident- except in the worst ones, you're almost always going to end up on 4 wheels...but if you're in ANY kind of an accident on a motorcycle, you'll almost never end up on two wheels. i remember one time seeing how fast i could get it up to, and at 110mph all i could think about was what would happen if i had a blowout. i never tried that again.

i used to enjoy my bikes, but i developed a spinal condition that makes it incredibly dangerous/stupid- the slightest mishap could kill/cripple me.

[guitar man]

25. They're not all that expensive

The Sportster is the everyman's bike, the base model for 2010 is $6999. If harley has made one big mistake it would be letting the Sportster line be a red headed stepchild for too long. The "RUBs" that can still afford the big toys have abandoned Harley for custom brands like Big Dog and American Ironhorse.

The Evolution Sportster is a damn fine motorcycle, I own a '99 model that has been a bulletproof ride so far. I have not had to spend a lot of money at all to keep riding it.

[DeadEyeDyck]

31. I have an 2001 FXSTS (Springer Softtail)

There is something very special about owning a Harley. I saved for years to buy mine.




I feel like I own a piece of America's Heritage. I mean, Harley goes back to the beginning of the industrial revolution. The entire pioneer personality is embedded in a Harley.

[guitar man]

33. That's a beautiful machine

I have always loved the look of a springer :thumbsup:

Here's my Sporty, I got a steal on it and have ridden the crap out of it with no real problems.

[IDFbunny]

35. They're certainly too loud

and deliberately so. How come are Harleys allowed to be so loud?

[Fumesucker]

3. I can recall when riding a Harley marked you as at least somewhat counter culture..

Then it got to the point that brain surgeons and Wall Street traders were riding Harleys.

Not so cool any more, IMO.

[Doremus]

4. Horror! Panic! Profits are DOWWWWWN!

Y'know, it would be easier to feel sorry for corps if they were carping about actually LOSING money.

I just can't work up a good cry over smaller profits, sorry.

[Psephos]

28. Profits are what fund job creation. n/t

[ProgressiveProfessor]

12. Damn, Buell was the only thing they made worth riding

[Craftsman]

15. HD is not a motor company it is a mechandising company that happens to make bikes

[pfitz59]

19. Do wall Street bonus babies care?

They can buy custom made bikes with their gi-normous 7 digit bonus checks!

[bullwinkle428]

23. Yeah, I'm guessing those Orange County Chopper goobers are probably

turgid with excitement over the news about the record bonuses for the Wall Street gang!

"Some call ya the elite...I call ya ma base!"

[SoxFan]

26. Two-wheeled Hummers

While I feel bad for the impact this could have on the employees, I loathe the Harley brand. Noisy toys for bozos who are overcompensating for something.

[IDemo]

29. They are actually making much better bikes these days

Case in point: the V-Rod - liquid cooled, ~125hp, engine developed with assistance from Porsche, belt final drive (as I believe all Harleys are now).


I may have to break down and buy one if my current $3995 ride ever stops being so much fun:

[DeadEyeDyck]

32. beautiful ride n/t

[alcibiades_mystery]

36. So Harley is still making a profit

Gotcha.