Hurt by the slumping economy and high gas prices, Milwaukee-based Harley-Davidson Inc. said last week that its second quarter earnings were $222.8 million, or 95 cents per share, down 23 percent from earnings of $290.5 million, or $1.14 per share, for last year’s second quarter. For the quarter, the company’s revenue dropped about three percent to $1.57 billion, down from $1.62 billion for last year’s second quarter.
During the second quarter the company shipped 80,326 motorcycles to its dealers and distributors. "While this result exceeds our guidance range of 76,000 to 80,000 units for the quarter, it is a decrease of 15.6 percent from the year-ago period," said Jim Ziemer, chief executive officer of Harley-Davidson, Inc. "This decrease reflects the impact of the shipment reduction we announced April 17th in response to ongoing weakness in the U.S. economy."
In response to the slumping economy, and rising gas prices, in April the company also announced plans to idle plants and change production schedules, resulting in the loss of 370 union jobs. "We expect U.S. economic conditions and ongoing consumer concerns to continue to create challenges at least through the end of the year," Ziemer said. "We believe the actions we took to reduce shipments to our U.S. dealers and our related workforce reduction position us appropriately for the current economic environment. I am confident about our future as we continue to manage and reinvest in the business for the long-term."
The company expects to ship between 74,000 and 78,000 motorcycles during the third quarter of 2008. For the full year of 2008, the company plans to ship between 303,500 and 307,500 units. The company is taking other steps to grow and meet the challenges of the slumping economy, Ziemer said.
"Last week, we announced our planned acquisition of the MV Agusta Group and celebrated the grand opening of the Harley-Davidson Museum," Ziemer said. "Next Tuesday, we introduce our exciting new 2009 motorcycles. A month from today, we kick off our 105th Anniversary Celebration with the launch of the first of 105 motorcycle rides to Milwaukee from around the U.S. These are just some of the ways we are positioning the company for the future, strengthening bonds with current customers and reaching out to new customers."