Harley is doing something right

[Smoker]

I like the comment at the bottom.


http://www.wgal.com/money/25440962/detail.html

Harley-Davidson has released its latest earnings report.

Despite slumping sales, officials at the motorcycle maker said profits more than tripled in the third quarter, which ended Sept. 26.

Harley officials said the company's net income totaled $88.8 million, compared to $26.5 million in the same period last year.

The company attributes the profits to improvements in its financial services division and efforts to streamline operations at plants, including the one in York County.

Retail sales of new Harleys decreased 7.7 percent worldwide and 9.4 percent in the U.S.

In a company statement, Harley CEO Keith Wandell said, "Despite the continued challenges in the economy, we are making solid, steady progress at transforming our business."

[Rincewind]

They forgot to mention how much money came from taxpayers in the towns where Harley threatened to leave (York and Milwaukee).  Nor is there mention of how many people lost their jobs in the "streamlining" of the factories.  

[PhilBiker]

Could the one-time payment for MV Augusta be buried in those numbers?  I'd think they would want to make that kind of thing very clear.

[cyclopathic]

numbers probably include the wholesale blow out Buell sales.

The reason they choose to liquidate Buell instead selling it to BRP b/c they got more money by blowing inventory 1/2 price.

[Rincewind]

numbers probably include the wholesale blow out Buell sales.

The reason they choose to liquidate Buell instead selling it to BRP b/c they got more money by blowing inventory 1/2 price.

The sale of Buell was also a major tax write-off - but that happened in 2009, not 2010.  The major recent tax change was the write-off of MV Agusta, which they sold for the cost of one cappuccino but which led to major tax benefits.

Profits through losses - yay.

[chornbe]

To be fair, profits through losses is a well-established practice in tough times. They're far from the only ones doing it. It's not too far off from mass layoffs and such.

They also wrote off and chucked a way a lot of bad debt.

They should spin off Eagle Mark completely, and remove in-house financing from the bike game.

[Rincewind]

To be fair, profits through losses is a well-established practice in tough times. They're far from the only ones doing it. It's not too far off from mass layoffs and such.

Agreed.  The article linked says there is a 7-9% drop in sales at the same time as this tripling of income.  So what Harley is doing "right" is playing with figures, writing off losses, and cutting jobs/benefits.... not selling bikes.

[bomber]

To be fair, profits through losses is a well-established practice in tough times. They're far from the only ones doing it. It's not too far off from mass layoffs and such.

They also wrote off and chucked a way a lot of bad debt.

They should spin off Eagle Mark completely, and remove in-house financing from the bike game.

All true -- financial dealings should be left to the experts, like banks . . . . . .

Oh, wait ;-}

[bomber]

Agreed.  The article linked says there is a 7-9% drop in sales at the same time as this tripling of income.  So what Harley is doing "right" is playing with figures, writing off losses, and cutting jobs/benefits.... not selling bikes.

HDI's job, oddly enough, is not to seel bikes -- it is to make money.

They are doing that.

[chornbe]

All true -- financial dealings should be left to the experts, like banks . . . . . .

Oh, wait ;-}

Thank you for your help.

[HipGnosis]

The Subject would be more correct if it was: 'Harley is doing something, right?'

[Biking Sailor]

Forget bikes, how are the T shirt and do-rag sales?  

[county]

Accounting hocus pocus to mollify stockholders...

[Redbandit14]

HDI's job, oddly enough, is not to seel bikes -- it is to make money.

They are doing that.

Yup and that's true of every company anywhere selling anything. Props to you not many people seem to get that even in A capitalist Society

[Biking Sailor]

All in all, you have to admire the management of HD for harnessing the "biker Image" and marketing/licensing it in the market place.  They continued to build motorcycles that fit that bill (post AMF) and grew the brand at an astonishing rate.  They made a lot of monies from non-riders (doctors, lawyers...), and added to their bottom line.  Along the way they kept the quality of the bikes at a pretty high level with a lot of metal instead of cheaping out with plastic, but not their cruisers.  

[falconati]

...and remove in-house financing from the bike game.

Yikes!  I'd have to disagree with you there.  There's a lot of money to be made in financing.  They've got a wide enough price-range for customers that it seems they could be a pretty good lender if they have enough cash/credit.  

[The Shepherd]

They are selling HD guitar picks at the local music store. They don't have to sell more motorcycles to make a profit. They just have to sell more of their logo branded junk to wannabes and fanbois.

[siclmn]

Yes, their profits are made from selling anything with the logo on it. I test rode one today. I said let me ride the biggest smooth riding one you have. He put me on a 96 inch bagger. What a peice of crap it was. Vibration from idle to any rpms, it was horrible. I asked the guy if he would buy a car that ran that rough. He just gave me a blank stare. It handled like an old lady. It leans and then it starts to turn. At every stop it dives 4 inches. He said that is what it's supposed to do. A new bike that runs like an old bike a 1940 old bike. It never changes. After that I had to put 300 miles on my K bike just to get that horrible experience out of my head.

[bassjones]

Yikes!  I'd have to disagree with you there.  There's a lot of money to be made in financing.  They've got a wide enough price-range for customers that it seems they could be a pretty good lender if they have enough cash/credit.  

Not to mention, they sell more bikes this way.  Some of their sales wouldn't happen if the buyer had to get a loan from a bank because that bank might be less willing to make that loan.  They can be a little looser with their credit decisions if need be.  

[chornbe]

I didn't say they should get out of the financing business.
I said spin off Eagle Mark bank. Partially-owned subsidiaries can be a great way to help isolate debt load when things go to shit.
Keeping the financing close at hand is nothing more than contractual binding. No one said it HAS to be 100% in-house.  
HSBC - thieves that they are - and GMAC do most of the "Big Four" financing in the dealerships, and there's no ownership or MFG liability there. You can buy a new Big-Four bike on a signature and a smile.