Harley-Davidson Announces Job Cuts After Sales Continue To Drop

Milwaukee-based Harley-Davidson Inc. is telling workers at some of its United States plants that layoffs are on the way.

The company has not announced the total number of layoffs or at which factories the cuts will take place. But a union official told WPR that Harley intends to layoff 180 employees at its Menomonee Falls and Kansas City plants, and furloughs will come in the fall.

The company will be shipping fewer motorcycles to dealers after a second-quarter earnings report Tuesday morning that showed U.S. sales were down 9 percent, compared to a year ago, according to the company. Harley also reported a nearly $100 million drop in revenue from motorcycles and related products.

On a conference call with Wall Street analysts, Harley-Davidson’s CEO Matt Levatich said that cutting back on shipments also means reducing production.

“This action will require an hourly workforce reduction at some of our U.S. manufacturing plants. We’ll be sharing details with employees beginning (Tuesday). But suffice it to say, no one wants to have to take these steps,” Levatich said.

Some workers may not learn their status until Wednesday, he said. The company recalled 57,000 motorcycles in June, and its shares have dipped by 11 percent since the start of the year.

In an official statement Tuesday morning, the company addressed plans to reduce the number of motorcycles it intends to produce and ship.

“This supports the company’s commitment to manage supply in-line with demand and is the result of continued U.S. industry declines,” the statement reads. “We believe we have the right strategies in place to attract new riders and continue igniting the passion of our current customers, and we will continue to manage our business with focus and discipline as we invest in growing the next generation of Harley-Davidson riders globally.”

As WPR reported in April, Harley-Davidson listed a long-term growth strategy on its corporate website. It included a goal of creating 2 million new riders in the U.S. by 2027, expanding its international business and growing its business with minimal environmental impact.

Director of United Steelworkers District 2 told WPR in a written statement that the job losses may be tied to facilities overseas.

“Not long ago, President Trump hailed this company as a model of American manufacturing,” Bolton said. “Shortly thereafter, management announced plans to open production facilities in Thailand. Now we get word that 180 hard-working Americans will be lose their jobs.”

The company employs 5,400 people in the United States. In April, 118 were let go at a plant in York, Pennsylvania.

Analysts say the layoffs may be due to fewer younger people being attracted to motorcycles. Wayne Houpt has owned a Harley dealership in Thiensville for 43 years. He said the company faces a challenge selling motorcycles to younger riders.

“The people we’ve had in our age limit are starting to grow out of them, but what we’re trying to do, like everybody else, is trying to get the younger people riding motorcycles,” Houpt said.

Speaking to reporters in Green Bay on Tuesday, Gov. Scott Walker said the state can’t “control market forces.”

He said the state will work with the company to expand sales to the extent that it can. “In the future, we’re going to continue to try to open up more export markets to sell their products,” Walker said.

Walker also took the opportunity to tout the state’s job climate and an unemployment rate hovering around 3 percent. “Our challenge right now is about filling jobs unlike six or seven years ago when it was about creating jobs.”

Editor’s Note: This story was last updated at 4:14 p.m. Tuesday, July 18, 2017. This story will be updated as WPR learns more. Chuck Quirmbach and Patty Murray contributed reporting to this story.