Photo: By k sungwon on Flickr
Harley-Davidson has been in trouble over the past five years. Bike sales have plummeted 31% since 2006, its core customer base is ageing rapidly and the market downturn has quashed people’s demand for $20,000 motorcycles.But lately, there have been glimmers of hope. Harley is about the have its first annual sales gain in nearly half-a-decade, and its stock has more than doubled since CEO Keith Wandell took the helm two years ago.
What has Wandell done to start dragging Harley out of the ditch?
By doing what Ford did, he says.
Ford CEO Alan Mulally provided Wandell with a “with a useful template for his own corporate turnaround,” reports Mark Clothier at Bloomberg.
The pair had a relationship that went back to Mulally’s first days at Ford, when Wandell was an executive at a big auto-supplier. Both came into the industry as outsiders, free of its taboos.
And to make things happen, they’ve both had to make moves that insiders may have shied away from. They both played hardball with dealers, nuked crappy brands, cut labour contracts, made major job cuts and closed plants. Wandell is also trimming fat and raising cash by selling some old investments, like Harley’s secret test track in the Everglades (which, ironically, was previously used by Ford to test cars.)
Wandell has also challenged Harley’s own traditional norms. It’s altering its marketing strategy to attract non-traditional segments, like women. “We can’t survive on our core customers alone,” he proclaimed at a symposium at The Ohio State University last month, but he’s walking a fine line. Harley’s brand needs those customers as ambassadors, and has to make sure it doesn’t alienate those hardcore fans.
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