I feared for the future of The Motor Company when, at the Milan Show introduction of the 500 and 750 Street models in 2013, H-D personnel insisted contrary to obvious fact that, "This is a young company, making products for a young clientele." In matters of business it is so often the case that the most vehement of corporate assertions are at 180 degrees to inconvenient facts. If only wishing could make it so.

The facts of the case are that the many Harley-Davidson motorcycles I see on roads and streets are ridden mainly by graybeards, suggesting these explanations:

  • That in the present economy younger people cannot afford premium motorcycles.

  • That a significant number of younger people have turned against motor vehicles in general, out of conviction that existing vehicle choices are more problem than solution.

  • That the tastes and opinions of older riders have imprisoned H-D's product planning within a model based on traditional masculinity, on styling from "a simpler time, when life made sense," and on frank appeals to nationalism and personal freedom. Until quite recently this product strategy has been very successful.

It is very much in the American tradition that H-D should attack all of these problems simultaneously: during WWII the Pratt & Whitney company employed just such simultaneous problem-solving in producing hundreds of thousands of aircraft engines, and in the 1960s the troubles of the F-1 rocket engine of the Saturn V which carried Americans to the moon were tackled in the same simultaneous fashion. This method is very expensive, but it can be the only method practical when time is scarcer than money—as it may be for H-D at present.

Harley’s program lists three objectives: new products (see numbers 1 and 2 above), broader access (which I believe is code for broadening the company’s culture of contact with the public), and stronger dealers (this, again, has to do with a deliberate change of culture to better engage with a wider demographic).

Harley's new electric line
Electric machines is part of H-D’s strategy to add 2 million new riders to the market by 2027.Courtesy of Harley-Davidson

Harley’s paper goes on to recognize the dimension of this work—“to inspire future riders who have yet to even think about the thrill of riding.” To take this out of our familiar two-wheeled context (we all love motorcycles), imagine strategizing the addition of 2 million new certified scuba divers, or hang glider pilots, or technical mountaineers. All of these activities clash with the “perfectly safe” aspirations of recent generations of protective parents. These are people who have worked hard to persuade their children—the young adults of today—that life is dangerous, requiring that all threats to personal security be eliminated. That, sadly, includes motorcycles. Motorcycling historian Larry Lawrence recently observed that when he was a lad, every backyard had its minibike or child’s motocross bike in action. Not today!

I must take issue with Mr. Levatich’s statement that, “Harley-Davidson is iconic because we’ve never been static.”

On the contrary, Harley-Davidson is iconic because it provides an island of reassuring constancy in an otherwise threateningly fluid world. Harley-Davidson has never “stooped to compete” with the rest of motorcycling, but continues to produce models which are paragons of cherished tradition. Harley is iconic because, instead of treating motorcycles as a commodity, it recognizes them as a basis for a lifestyle and shared set of attitudes. Harley-Davidson creates a dramatic and attractive narrative into which the buyer is admitted. H-D management conserves these principles.

Goals And Pathways

The freedom of the open road is all very well, but remaining in the marketplace depends upon remaining profitable. As Bill France and others have observed, “If you’re not growing, you’re shrinking.”

Therefore the underlying goal is to reach new buyers, both here and abroad—especially in rapidly expanding Asian economies. Much more than boardroom arm waving will be required to achieve this.

New Products

In this category, the rock and hard place are 1) the need for change and 2) the danger of following the buzz.

The latter—following the buzz—brought the downfall of a number of “green” companies such as A123 Battery, Fiskars, etc. with nearly every failed management saying afterward, “We overestimated demand.”

In an increasingly internet-driven world it is easy, and tempting, to mistake the buzz of government “green initiatives” and media-savvy social pundits for a real business opportunity. So far, sales of electric vehicles remain small.

Yet it’s better to lead a successful trend than to wait for it to appear and then join. In the heady days of “alternative motorcycle front ends” the tiny Bimota firm was hailed for daring to commit to its radical Tesi hub-steerer. But when interest failed to materialize and Bimota went into hibernation, no one was surprised.

New Harley electric
New products are key to growth, but leading a successful trend rather than following the buzz is difficult to achieve.Courtesy of Harley-Davidson

Only the market can tell us if H-D’s bold move into electric motorcycles will set an enduring trend or turn into another market dipstick that comes up dry. Only the market can tell us if the H-D cachet can attract the very different clientele who might be interested in commuter electrics and electric-assisted runabouts. We have seen Polaris strategically buying business elements that could one day assemble into an electric motorcycle capability. Yet it appears more likely that its goal is to be ready to manufacture electric postal truck fleets or military light transport than it is to persuade 10,000 young urban sophisticates to adopt electric two-wheelers.

H-D'S Four New Product Points

“Extending the company’s leadership in heavyweight motorcycles…”

We can all agree that this remains central because it is the basis on which Harley’s post-AMF success has been achieved—selling a lifestyle rather than just physical products. Yes, a 75-year-old rider may not buy another machine, but financially able 50- and 60-year-olds are present in significant numbers to take their places. This is the “core business” to which H-D returned when the events of 2008–’09 made experiments such as Buell and MV appear irrelevant and even dangerous.

“Introducing a new modular 500cc to 1,250cc middleweight platform…”

Overall, these machines look good and have the attractive muscular density we associate with H-D’s recent styling.

I hope I am just being old-fashioned when I object to disguising engines with molded-on false pushrod tubes and false fins. I prefer the shapes of engine castings to be defined by what is inside them, but perhaps I’m wrong and a modern V-twin’s heads should look like tape players or helmets worn by aliens.

I am reminded again of the dangers of buzz in a couple of details. Industry buzz three years ago was insisting that “ADV is replacing sportbikes!” Sportbikes have certainly left the scene, but so has the idea that the future of motorcycling is men in $800 Aerostich jackets posing next to tall 500-pound Dakar replicas. Or is it low-priced 300s? Or darty-looking streetfighters? Or? What we have seen is refraction of the white light of motorcycling into many separate colors. Which of these colors is the future? Pick one.

Ditto the “fatbike look” coming over from mountain biking.

“…new line of more accessible small-displacement motorcycles for Asia emerging markets.”

I remember reading an optimistic piece from Piaggio on how its long-established Vespa brand should be able to command a 30-percent price premium in the hurly-burly of selling in Vietnam, Indonesia, and Thailand. Certainly it’s important to sell into Asian markets—we know that between the two world wars, both Indian and Harley-Davidson exported between one-third and one-half of their product. I hope that “a strategic alliance with a manufacturer in the Asia Pacific region” still means offering real, identifiable Harley-Davidsons, not “stooping to compete” in a tough light-transportation market in which decision-making is shared with a partner from another culture.

LiveWire
The LiveWire is the first great-looking electric motorcycle.Courtesy of Harley-Davidson

“Leading the electric motorcycle market space…” LiveWire.

This is the very first great-looking electric motorcycle. The two approaches generally used before now are:

  1. Simple substitution. Start with a generic sportbike and replace its internal combustion engine with an electric motor and 250 pounds of batteries. It looks like an old GSX-R, but it's electric.

  2. The picnic cooler on wheels. The "cooler" is the featureless lump of the 250-pound battery.

By contrast, Harley stylists have made this bike look like a champ car’s Offenhauser engine built into a motorcycle. They have also made great use of what I call “Death Star” surfaces. All surfaces on LiveWire have a shape that attracts and leads the eye (I won’t make the obvious organic comparison). The moment I saw this photo I thought of Guzzi’s 1953 longitudinal-four GP bike, its engine a miniature Offy.

This is a shotgun approach to urban electrics: Run up the flag and see who salutes it.

Broader Access

As I see it, this is about building a bridge between the traditional dealer and marketing establishment, and the new marketing and locations that will be necessary to reach a wider group of potential buyers.

The mass market on which so much used to be based has morphed into a have and have-not market. Planning a product for the mass market is a recipe for failure. Ducati has successfully employed internet “teasers” to stimulate interest in its expensive new products. When the products are finally offered for sale—again, on the internet—they have sold out rapidly. The old way—hoping for floor traffic, having another instant coffee, and putting sale notices in local media—is still in place, but traditional dealers have to bitterly oppose attempts to bypass them as manufacturers seek to communicate directly with buyers in the new way. An active, sophisticated presence on the internet is required.

What if the future buyers Harley is seeking are most comfortable in Apple and Ralph Lauren shops, and the buyers H-D now have are most comfortable in traditional motorcycle shops? What bridge could join those cultures? Because that bridge does not exist, Harley proposes “smaller urban storefronts” to bring the brand to parts of town where upscale shoppers are comfy. Can this be done without violating existing dealer franchises?

Stronger Dealers

In the economic depression of the 1930s motorcycle dealers did everything they could to foster the development of a separate and cohesive motorcycle culture—organizing road rides and other events, forming brand-centric motorcycle clubs, and even co-funding clubhouses. The prosperity of post-WWII America made such things unnecessary, allowing dealers to concentrate on the bare nuts and bolts of sales of machines, parts, and supplies. This change became so pervasive that by the later 1960s motorcycles were looked upon as completely depersonalized “leisure equipment.” The motorcycle had become a “fun appliance.” This arid process must to the degree possible be reversed, returning motorcycling to the status of a lifestyle, of “living in the brand.”

The Danger Of Burning The Brand

During the 1920s and ’30s America’s prestige auto was not Cadillac. It was Packard (“Ask the man who owns one”). When WWII ended in 1945, Packard planners somehow decided that what Americans wanted was a cheap Packard. Such a use of a premium brand to sell a degraded product is called “burning the brand.” In fact, what Americans wanted was for Packard to remain the ultimate, the most desired of automobiles. The cheap Packard failed and so did the company. At the same time, Velocette, known and respected as a producer of fast, sophisticated sporting singles, decided that what post-war England wanted was an underpowered scooterette, the LE. The largest buyer of the LE was the postal service. Velocette became history.

New Harley-Davidson electric
Some sells of the upcoming H-D product will be more difficult than others.Courtesy of Harley-Davidson

Like any business, Harley needs a wider market and greater income. It is tempting to imagine that the long-established Harley-Davidson brand can sell a wider range of products—electric bikes, replacements for V-Rod and Street models, an ADV-styled streetbike, middleweights for Asia, and motorcycles-as-haberdashery to hipster folk. Some of these will be hard sells so it won’t be an easy process. I hope Harley can make it work.