Struggling Harley-Davidson Halts Production Amid Pandemic
The coronavirus is another issue the motorcycle manufacturer can’t afford.
Announced today, Harley-Davidson will shutter most of its U.S.-based production plant in Menomonee Falls, Wisconsin. The closure comes after one of the company’s workers tested positive for Covid-19, better known as the coronavirus.
Nearly all of Harley’s manufacturing will be closed, including its powertrain and vehicle assembly operations. Like other industries, the motorcycle manufacturer told much of its white-collar employees to work from their homes via computer, though critical onsite personnel will remain.
In the announcement, acting CEO Matthew Levatich said, “We recognize the unprecedented nature of this global crisis. In order to best support our employees and following the social distancing guidance issued by public health authorities, we are temporarily suspending the majority of production at our manufacturing facilities. We will continue to monitor the situation and take necessary steps to prioritize employee health and safety.”
Harley-Davidson’s plant closure comes at a time of crisis for the brand. Sales have fallen in recent years to record lows as a product lineup ages in parallel with its intended demographic. The cost of ownership, along with the brand’s one-note designs, and some behind-the-scenes mismanagement, including the ousting of Mr. Levatich from the CEO position mounted by investment group Impala Asset Management, have contributed to its fall from motorcycling dominance.
Jochen Zeitz, formerly the CEO of Puma and a member of Harley-Davidson’s board, has been named as Levatich’s successor. Zeitz’s appointment pushed forward by Impala, is a shrewd move as many have credited his management in saving the struggling outerwear brand, seeing its stock price go from €8.6 to €350.
Zeitz still has his work cut out for him, though. Even recent bright lights like the utterly fantastic LiveWire electric motorcycle, which was somewhat doomed due to its $30,000 price tag, and the announcement of a massive push to revitalize its lineup with an off-road adventure motorcycle, a new naked sportbike, a mid-tier EV, and a number of cheaper traditional Harleys, haven’t moved the needle enough to counter Harley’s looming fall.
Harley-Davidson’s statement also included that those affected by the shutdown will be temporarily laid-off, though their medical benefits will continue. Given the magnitude of the viral outbreak, Harley-Davidson’s commitment to resuming production by the end of March, after a thorough cleaning, seems highly unlikely. Here’s hoping Zeitz can pull off Harley’s much-needed Hail Mary.
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