Uphill Climb for Harley

As demand waned in the third quarter, wide-moat

With new full-year shipment guidance down to 265,000-270,000 (from 282,000-287,000 at the beginning of the year), little promise is left in rising shipments for the fourth quarter; the new outlook indicates shipments should be flat for the remaining quarter, versus our prior internal fourth-quarter estimate calling for 16% growth. For the full year, this takes year-over-year shipments from rising 2% to falling 2%. The insight the past few quarters have offered us is that not only is brand important, but so is price in certain instances. Recently, it seems that competitive pricing is outweighing rising brand penetration for Harley-Davidson, acting as a drag on retail sales and shipments.

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