Harley-Davidson has disclosed the circumstances that led the Milwaukee-based company to suspend motorcycle assembly and shipments twice within the last year.
In
May of 2022, Harley announced it would be suspending “all vehicle assembly and shipments” for two weeks after discovering issues with one of its suppliers. In June of 2023, Harley was once again forced to suspend production of most of the motorcycles manufactured at its York, Pennsylvania facility for approximately two weeks.
In Harley’s latest 10-Q filing, New Hampshire-based
Proterial Cable America (PCA) is identified as the Tier 2 supplier linked to both assembly suspensions. The issue began in quarter two of 2022, when Harley learned PCA was facing a “potential regulatory compliance matter” related to brake hose assemblies. This led to Harley’s assembly suspension last May.
"Since then, (Harley) has been working through the regulatory compliance matter with PCA, the company’s relevant Tier 1 suppliers, and the National Highway Traffic Safety Administration (NHTSA), the agency responsible for brake hose assembly compliance in the United States," according to the 10-Q filing.
However, last month, Harley received a separate letter from PCA informing the company that they were investigating a new potential quality issue with brake hose assemblies that were produced after the 2022 suspensions. This caused the suspension at Harley’s York facility.
Both PCA and Harley have petitioned the NHTSA to make a determination that the aforementioned brake hose issues are “inconsequential to motor vehicle safety,” according to the 10-Q filing. If this determination is granted by the NHTSA, Harley would be exempt from any sort of recall related to the brake hose assemblies.
Harley has presented the NHTSA with third-party and internal testing that shows the brake hose assemblies can hold up to extreme conditions and have no impact on brake performance. Harley said it is not expecting a recall at this point but has not completely ruled out the possibility.
“The company estimates, based on its available information and assumptions, that the cost of a potential field action or recall in the aggregate, if any were to occur, could range from approximately $100 million to $400 million,” according to the filing.
If any recall is deemed necessary, Harley said it would “seek full recovery of those amounts.”
Representatives with PCA were not immediately available for comment.
