Cool spring weighs on Harley

Second quarter Harley-Davidson dealer sales have been slow so far because of a late spring, according to a new research note by Milwaukee-based Robert W. Baird & Co. Inc.

However, things are picking up for the 51 dealers Baird surveyed as the weather improves, particularly for new bikes like the Project Rushmore line.

While the second quarter is flat from 2013 so far, Baird predicts a strong finish in June, helped along by Harley’s Street models. The Street bikes are used in the Riding Academy training fleets, so they will be recorded as retail sales right away, Baird said.

“We expect a strong finish in June, including a boost from new Street models,” the Baird note stated.

In addition, inventory is lean, and newer models are in high demand.

“Rushmore has been huge,” one dealer said of sales. Another said, “We can’t get enough of the hot selling (Rushmore) bikes.”

Harley dealer sentiment is “high” (82 out of 100), and the dealers expect retail growth of 5 percent for the year, which is in line with Baird’s forecast.

In its most recent earnings report, Harley said it sold 57,415 motorcycles worldwide during the first quarter of 2014, a 5.8-percent increase over the same quarter last year. The sales boosted the company’s total revenues by 10 percent, with earnings up by 22 percent.

Much of the growth came from international sales, which increased 10.9 percent over the prior year. Sales in the United States grew by 3 percent as the company, accustomed to marketing to middle-aged men, made inroads among women, African American and Hispanic consumers.

Harley’s stock shares, which trade with the ticker symbol “HOG,” have been hovering near their 52-week high of $74.13 in recent weeks.

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