On a drive to tackle declining sales in United States, Harley Davidson is investing its resources into electric motorcycles in order to attract young and environment conscious riders.
While the 116 year old automobile giant rolls out its first “LiveWire” bikes labeled at $29,799 into the market, Harley has clearly stated its interest in attracting young customers. However, this bold steps appears to be too farsighted as it has been aimed at a market of young, eco-conscious and affluent consumers, which is currently nearly non-existent.
The sports variant was available for pre-order since January of this year in US. Irony is that most of the orders have been received by the old customers and not the young targetted motorcyclists. Since Harley has gripped the market, United States has been its biggest consumer, accounting to more than half of its sales. However, the company has failed over the years to increase their sales here. Since their market continues to move down with older segments, the company is shifting its focus to potential new customers with their latest venture.
The company’s reports of 2018 revealed the steepest decline in sales in United States in the past 4 years. Estimates speak that the sales will continue their downfall in 2019 too. The company has witnessed a 42% downfall in stock price in the past 5 years while the competitor S&P 500 Index has shown a rise of 47% in the same span. These figures are concerning for the brand.
On the subject of market potential of LiveWire, a bike dealer told Reuters;
Interest is very high. But once you get to pricing, interest is thrown out of the window.
More than half of the college grads in United States, towards whom Harley has cited its hopes, are burdened with student loans which drains out an average of $200 to $300 from them monthly.
Harley is also not offering any discounts or incentives for its potential buyers, which may impact their sales graph positively.
Gary Jon Prough, general sales manager at a dealership in Countryside, Illinois, told Reuters that majority of youth will not be able to avail the legacy of LiveWire as it appears to be targeted at youngsters earning above $100,000 annually.